1031 - Protect The Gain | SOLD: 2426 Webberville

PROTECT THE GAIN with the 1031 Exchange:

Any good Commercial Real Estate investor plans on their investment properties appreciating in value. But when the time comes to sell, owners are staring down the barrel of a 20% capital gains tax (+ depreciation recapture). A 1031 Exchange is the savvy investor's answer. By moving sale proceeds into a "like-kind" property, investors can avoid their capital gains tax incidence and #protectthegain. The process is time-sensitive, which becomes all the more pressing in hot markets like East Austin. Luckily at Beck-Reit Commercial we are experienced 1031 experts, having used the process time and again throughout our investment career to compound our investment success. We know just how quickly time can fly in these transactions.

With just 45 days after closing to identify three potential 1031 properties, it's best to begin one's search as soon as possible... ideally before the initial property has closed. In markets like Austin’s, where full-price cash offers are a constant competitor, time becomes all the more paramount. Remember, you MUST close on one of your three identified properties in order to complete the exchange, which is why we always recommend our 1031 clients have at least one of the three identified properties under contract prior to identifying.

Unfortunately for our most recent 1031 exchange client, her Brokers left her at the closing table with limited information and an unwillingness to help complete the second half of her exchange. She called us in a panic, with only 20 days left to identify and no properties on her watchlist in Austin's crazy-hot market. As a young woman buying in ATX,  we understood the assignment at hand. At Beck-Reit we work well in high pressure situations and are always successful when goals align with our values (Gratitude. Respect. Integrity. Trust. GRIT). We were ready to get her what she needed and close within the tight and ticking 180 day timeline. Our client decided to purchase 2 properties, spreading her gain and limiting her risk.

With $1.1M to place, our client secured 2400 Webberville via a contract assignment negotiated by Beck-Reit Commercial. She financed the property so she could also purchase 2426 Webberville, a pocket-listing in BRCRE's portfolio that we were preparing to put on the market. This 1031 exchange helped us get our Seller's property under contract in less than a week, prior to going on the market at all.  By completing the 1031 exchange, we helped our Buyer save roughly $300K in capital gains tax.

A special shout out to Scott Sproat, who manages 4th &Chicon and recommended us to handle this very SHort Fuse Transaction.