Tenant-In-Common / 1031 Exchange Properties

Private Equity Group is your expert in tax-advantaged real estate. We specialize in 1031 Exchange properties offering you quality investment grade replacement real estate designed to meet your short-term needs and long-range financial goals. A 1031 Exchange is one of the most powerful tax deferral strategies available.

Tenant-In-Common (TIC) investments allow you to pool your money together with others to invest in large, institutional-quality properties that you could not afford on your own. Choices abound including multi-family residential, office, retail, industrial, hospitality, assisted living, golf courses, self-storage, and even oil and gas producing wells.

As a TIC investor you'll own an undivided fractional interest in the entire property while retaining rights similar to sole-ownership properties.

Savvy investors use the Internal Revenue Code §1031 as a means of building wealth. By exchanging one rental or business property and reinvesting the net proceeds into other like-kind real estate, you can defer the recognition of capital gains taxes and depreciation recapture, leaving you with substantially more proceeds to purchase a replacement property.

Private Equity Group works with the leading Tenant-In-Common sponsors. You will be able to choose from numerous asset classes and geographic regions, selecting properties that meet the strict IRS imposed deadlines for the identification and closing on your replacement property(s). And since TICs come prepackaged, they eliminate many of the worries associated with real estate transactions.

Our TIC investors have simplified their lives through the elimination of time-consuming and costly management problems. TICs keep investor capital working, may increase monthly cash flow, provide capital appreciation, and defer capital gains and depreciation recapture taxes.

Our 1031 Exchange property programs are designed to meet wide-ranging needs from small investors with limited funds to those wishing to invest significant capital. Our structure allows investors to own and participate in the profitability of large institutional-quality real estate while delegating the hassles of property management to the professionals.

When executing a time-bound 1031 exchange, it's important to work with the very best. Our experts provide you:

Turnkey real estate solutions tailored to your individual needs
Access to the leading Tenant-In-Common sponsors
Large property inventory
Extensive due diligence performed on your behalf by teams of professionals
TIC industry experts including real estate professionals, attorneys, and MBAs
Ongoing service and support before, during, and after an investment is made
Rights to transfer your interest in the same way as a sole ownership property
Greater diversification in your real estate portfolio typically achieved through REITs and mutual funds
Opportunities for investors to enjoy geographic and asset class diversification

We represent only those products that survive our demanding, thorough due diligence process.

Many financial planners recommend allocating a portion of your portfolio to investment real estate. Tenant-In-Common properties may provide the diversification you need to bolster overall portfolio performance.

Please contact us to learn if TIC 1031 replacement properties are right for you.

Need a good real estate investment, but not interested in exchanging property? TICs also provide opportunities for those simply wishing to invest capital. Please call to find out more.

As professionally managed, turnkey real estate solutions, TICs provide numerous benefits:

More time and freedom by eliminating mundane management obligations
Potential for higher net cash flow with less liability (non-recourse debt)
Renewed tax deductions for greater savings
Credit-worthy tenants
Triple-net leases
Retention of direct property ownership in your interest
Rights to transfer your interest in the same way as a sole ownership property
Greater diversification in your real estate portfolio typically achieved through REITs and mutual funds
Opportunities for investors to enjoy geographic and asset class diversification

Tenant-In-Common interests are only available to accredited investors
Tenant-In-Common interests are subject to the usual risks of real estate
Tenant-In-Common interests cash flows and returns are not guaranteed
Tenant-In-Common interests involve fees that may offset tax savings
Tenant-In-Common interests are generally illiquid with a limited secondary market
Tenant-In-Common interests require a high level of due diligence

Tenant-In-Common (TIC)—also known as co-ownership or fractional ownership—is a common form of holding title to real property in which the owners own an undivided fractional interest in the entire property.

In March 2002, the Internal Revenue Service issued Revenue Procedure 2002-22 outlining when the IRS will consider a transfer of property held as a tenancy-in-common to be an investment in real estate under Internal Revenue Code Section 1031 (1031 Exchange). The Tenant-In-Common (TIC) ruling, allows you to exchange your investment property into an undivided, fractional interest of a much larger, higher-valued, and better-located property.

The idea behind the growing Tenant-In-Common (TIC) industry is really quite simple—with a minimum investment, the average person can have a part ownership in an institutional-type property.

As a TIC co-owner you will receive a separate deed and title for your pro-rata share of the property. You will share in your percentage interest of the property's costs, economic, and tax benefits. Cash flows are typically paid monthly, with cash flows ranging from 5% to 10% in the initial year, and are tax-sheltered via depreciation pass through and interest deductions. You will retain rights similar to a sole-ownership property.

The required purchase amount will vary depending on the property. Typically, minimum investments are around $250,000. A few niche sponsors cater to investors with as little as $50,000 while others are geared to investors with $500,000 or greater. Investment holding periods may also differ, but generally range from three to seven years.

While paying taxes is the law and a patriotic privilege, Uncle Sam allows you to reduce and defer taxes, create wealth, and keep more of it.

A 1031 Exchange provides capital gains tax deferral to real estate owners who sell their investment, rental, business or vacation real estate, and reinvest the net proceeds in other like-kind real estate.

A well-executed exchange results in the taxpayer being able to utilize 100% of the proceeds from the sale of his/her property to purchase a replacement property, thereby deferring all capital gains taxes—state and Federal. If, as part of the exchange, the taxpayer receives other (not like-kind) property or money—called boot—taxable gain is recognized to the extent of the other property and money received.

Careful adherence to the requirements of a Section 1031 Exchange is important in maintaining the tax-deferred status of the transaction. When arranging for the sale of investment property, exchange language must be included in the sales contract. The IRS gives investors a maximum of 180 calendar days from the closing of the initial sale to complete the exchange. Within the first 45 days of this period a seller must file a list of possible replacement properties with a qualified intermediary—a neutral third-party designated to act as the property closing agent. A seller may target up to three properties regardless of value, or a group of properties with a combined value that does not exceed 200 percent of the value of the initial property sale. Failure to meet these deadlines will disqualify the entire exchange and the IRS will bill you for capital gains.

What is "like kind" real estate? Properties are "like-kind" if they are of the same nature or character, even if they differ in grade or quality. When executing a 1031 Exchange you have to exchange direct ownership in real estate for direct ownership in real estate. As long as both the property to be sold and the property to be purchased are held for productive use in a trade or business, or for investment purposes, taxpayers are free to purchase whatever type of property they want. You cannot exchange real estate for a partnership interest or interest in a limited liability company or vice versa.

Commercial
Office
Retail
Shopping Center
Industrial

Multi-Family Residential
Energy
Hospitality
Assisted Living
Other

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