1031 Exchange into Net Lease & DSTs
Client was introduced to us in their ID period after their first pursuit did not make it.
Their exchange required replacing a certain amount of debt, in addition to equity realized from the sale of their ownership interest in a 64-unit multifamily property.
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Initially, the client was resigned to the fact that they would have to inject personal funds to replace the debt portion of their exchange, as obtaining a new loan was not an option for them; however, given our experience handling 1031 requirements and unique specialization, we offered a compelling solution that our client had not previously considered—
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By allocating a small portion of their equity towards a highly-leveraged zero cash flow DST, our client was able to cover all the debt they needed to avoid boot on their 1031 exchange. They applied the balance of funds towards a triple net investment all cash. In effectuating this strategy, our client was able to avoid having to bring in personal funds into the exchange and managed to defer all capital gains by meeting their 1031 objectives in a short timeframe.
Client Testimonial:
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"After selling my 64-unit apartment building, I needed to complete a 1031 Exchange to avoid high capital gains taxes but found the process overwhelming. After consulting with several people, I was referred to the NLX Team.
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With their expertise and thorough research, NLX guided me in selecting the right property for the exchange. They explained the pros and cons of each option, helping me make an informed decision. NLX also assisted me in investing in a DST to defer taxes.
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Thanks to NLX’s professionalism and support, the critical 1031 Exchange timelines were met, and the entire process was stress-free. I highly recommend NLX for their exceptional service."
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Sale Price: $1,800,000
Cap Rate: 6.12%
Guarantor: Credit: BBB
Term Remaining: 9 years
Rent Increases: 10% each option