Successful commercial real estate property deals require an effective TEAM dedicated to making sure your 1031 exchange is executed flawlessly and on time. Without going any further from the start we will list the number of minimum required members that typically your team will need to include:
- Top intermediary
- Commercial broker
- Real estate attorney
They all need to work together to make sure the necessary steps are taken for you to receive the tax-free benefits of 1031 exchange properties.
The Importance Of Having Your CRE “Dream Team” When Considering 1031 Exchange Properties
It’s important to make sure you have your team in place, before you initiate the selection period, since you have just 45 days to identify a suitable property, and 6 months to close the entire deal. This will allow you to focus on choosing the 1031 exchange properties that best fit your investment goals instead of worrying about the legal process or complex tax questions.
Here’s What Happens During The Selection Period:
- First, a commercial broker advisor such as Westwood Net Lease Advisors can start submitting the various properties to be reviewed and narrowed down for the other pros on the team to analyze.
- Next, the intermediary comes first to correctly satisfy your current sale of investment property and to make sure the new property is handled correctly for IRS rules to be followed.
- Once the commercial broker submits various investment or income properties in the trade period and the investor selects three or more to proceed, the attorney and CPA chip in with advice on the 3 selected to make sure the real estate investor understands the legal and tax issues of the deal.
LOI and contracts are worked on by commercial brokers and attorneys and submitted to sellers for their approval. In the meantime, the due diligence process begins, investigating the title, lease, tenants, survey and environmental issues.
The CPA will also give tax advice.
Final Contribution Of Your Ideal Team To The 1031 Exchange Process
Having your team lined up in advance and interviewed before you begin the 1031 exchange process greatly contributes to your level of comfort and trust in your team. It also gives you the ability to move forward in a timely manner on the top nationwide properties.