Chicago, Illinois – When a commercial real estate investor approaches the 1031 Exchange transaction, they must consider a few things. First off, all 1031 Exchange deals must be qualified to fit the IRS and applicable US tax codes. The 1031 Exchange must have property that is a “like-kind” and held for investment. A proper 1031 Exchange must have the proceeds from a 1031 exchange sale flow through the safe haven of a “qualified intermediary” and not through the seller for the transaction.
Commercial real estate investors should be aware that the total purchase price of the like-kind property should match, or be close to, the net sales price of the 1031 Exchange replacement property. This is mandatory in order to avoid having to pay any capital gains tax until the 1031 Exchange replacement property is sold. Many commercial real estate investors see this as a commercial loan from the Government by deferring the capital gains tax with a 1031 Exchange.
The 1031 Exchange can be used by individual investors for net lease properties, office properties and industrial properties. Recently a commercial real estate Company that is familiar with the 1031 Exchange was involved in a large transaction. A Chicago-based commercial real estate company, Equity Capital Management, is disposing of 39 net lease properties for about $625 million. This $625 million sale contains office, industrial properties, and retail net lease properties which are signed up to long-term net lease agreements.
These are all excellent choices for 1031 Exchange replacement properties. The Chicago-based commercial real estate company acquires net lease properties, then they decide on investments based on various exit strategies and long-term goals. 1031 Exchange transactions are best suited for this long term approach as apposed to short term holds on property. The goal of the 1031 Exchange is defer taxes and build wealth. Obviously, unless you find a property loaded with equity, it takes time to build equity and then roll the profits into a larger commercial property.
This commercial real estate company, Equity Capital Management has experience with various single tenant net lease properties for a potential 1031 Exchange transaction. Some very important 1031 Exchange time-lines are the 45 day Identification Period. Any net lease property that has the possibility of being a 1031 Exchange replacement property must be identified by the investor within a 45 days from the date of sale of the relinquished property. Also remember the 180 day 1031 Exchange Period. The 1031 Exchange must be completed by the investor within 180 days after the sale of the relinquished property.
This 1031 Exchange commercial real estate company is selling these commercial properties that are scattered across 22 different States. These commercial properties include the sale of the headquarters of Solae Co. and Novus International Inc., which are positioned in St. Louis. The majority of these commercial properties were acquired through off-market transactions. This was as a result of excellent relationships with commercial real estate developers, corporations, and other institutional investors, which may be in search of a 1031 Exchange property.
Equity Capital Management, LLC (ECM) is a principal-oriented investment firm which is based in Chicago, Illinois. This commercial real estate company has several offices, with affiliates in New York, St. Louis, and Bern (Switzerland). This commercial real estate company seeks investment opportunities in the commercial net lease properties markets. Equity Capital Management believes that the supply and demand factors have created strong prospects for current commercial properties producing income.
Many of the office buildings and industrial properties in this transaction are corporate or regional headquarters. Also many of these commercial properties are significant regional or critical hub distribution centers. The net lease properties are currently controlled by ECM Diversified Income & Growth Fund and ECM Income & Growth Fund III. These two investment Funds are sponsored by Equity Capital Management.
We are not fully aware of which net lease properties are being sold. A possible list of some of the 1031 Exchange Candidates could include the following:
Tenant – Property Type – City – Total Square Feet
MeadWestvaco 1031 Exchange Candidate – industrial Raphine, VA – 619,636
AT&T 1031 Exchange Candidate – office Tucker, GA – 406,292
FedEx 1031 Exchange Candidate – industrial Grayslake, IL – 214,745
Solae LLC 1031 Exchange Candidate – office St. Louis, MO – 171,699
Checkfree Services 1031 Exchange Candidate – office Dublin, OH – 150,111
International Paper Co. 1031 Exchange Candidate – industrial Marianna, FL – 114,597
Coca-Cola Enterprises 1031 Exchange Candidate – industrial Shreveport, LA – 100,123
Novus International 1031 Exchange Candidate – office St. Charles, MO – 90,722
T-Mobile USA 1031 Exchange Candidate – office Brownsville, TX – 78,421
T-Mobile USA 1031 Exchange Candidate – office Augusta, GA – 78,429
T-Mobile USA 1031 Exchange Candidate – office Salem, OR – 69,111
Are you searching for 1031 Exchange Properties?
O’Reilly Commercial Realty LLC
Phone: (352) 237-2222