Real estate investors exploring tax-deferred investments often find themselves navigating a landscape dotted with an overwhelming variety of options, one that frequently comes up but rarely examined in detail is the DSTs (Delaware Statutory Trusts) to 721 UPREIT. These vehicles have seen a surge in popularity as investors look to optimize tax advantages and real estate investments utilizing the 1031 Exchange while planning for their estate plan and lifestyle ..read more

“Can I 1031 exchange into a REIT (Real Estate Investment Trust)?” Clients often ask this question when we discuss the options available for 1031 exchange. The answer, like many things in tax, is nuanced.  The short answer is “No.” REITs are corporations that own investment real estate or real estate-related assets and receive special tax treatment of their dividends by adhering to specific IRS rules ..read more

  Zero Cash Flow Investments What is a “Zero Cash Flow Investment”? Sometimes referred to as “Zero-Coupon” or just “Zero’s,” these properties are just what they sound like - properties that that provide no cash flow to the owner or owners. These are highly leveraged assets, with loan-to-value (LTV) ratios of 80+%. All Net Operating Income (NOI) cash-flows are directed to debt service with the intention of quickly paying down principal and interest ..read more

You don’t need to be reminded of the pain that inflation can inflict on your spending power and investment portfolio performance. For over two years now, we have lived through some of the highest inflation in US history, and while the Fed remains steadfast in its mission to tame inflation, it does not appear that this erosive demon is going away anytime soon ..read more

The 1031 like-kind exchange can seem intimidating for real estate investors and owners. There are often multiple moving parts to coordinate, multiple parties to manage, and many thousands of dollars in tax liability at stake. You can understand why exchangers might want to have a Plan B or Plan C to help them sleep better at night while their 45-day or 180-day clock is ticking ..read more

A 1031 exchange is a powerful tool that can allow real estate investors to defer capital gains taxes and depreciation recapture when selling appreciated property. Depending on the circumstances, it may be possible to combine a 1031 exchange with a Section 121 exclusion to achieve an even greater tax advantage. Here’s a closer look at each of these tax codes and how they can work together ..read more

The pandemic and the emergence of a late-cycle commercial real estate market have been challenging for many real estate sectors over the past few years. While certain sectors like multifamily housing and industrial facilities continue to perform well, others, including commercial office space, retail strip centers and shuttered shopping malls, have not necessarily fared as well ..read more

Savvy property investors have been using 1031 exchanges to defer capital gains taxes for over a century. Despite its long history, there are still several common myths surrounding 1031 exchanges. While some of these myths may deter investors from reaping the potential benefits of engaging in a 1031 exchange, others can cause an exchange to fail, leading to potentially significant financial losses. Here is a look at five common misconceptions and the facts you need to know ..read more

If you are familiar with the 1031 exchange, you are probably aware that Section 1031 of the Internal Revenue Code allows investors three options for selecting replacement properties with their exchange. Yet, we find that many exchangers aren’t sure which approach is best for them, or they don’t fully understand the requirements of each option ..read more

Silicon Valley Bank (SVB) shares dropped from $267, on 3/08/23, to $100 the next day. The reason, the bank announced a capital raise and the sale of a large number of securities at a loss. That sparked investors and depositors to flee. The bank’s parent company disclosed that the market value of its held-to-maturity (HTM) bonds was $15.9 billion less than their balance-sheet value as of the end of September 2022. That gap was slightly more than SVB's $15.8 billion of total equity at the time ..read more