What is the difference between investing in a Tenant in Common 1031 exchange and simply exchanging for another sole owned property?
The difference is the financial and lifestyle objectives of the real estate investor. The investor needs to answer the following question, “Do I want to manage property anymore or do I want to delegate the day-to-day management to professionals?” The Tenancy in Common structure allows the investor to have professional property managers take care of the mundane tasks of collecting rent, performing maintenance, etc., while still participating in the major decisions. By exchanging for a fractional interest in a Tenant in Common property, the investor gains access to larger, institutional-grade properties, such as an office building, a drug or grocery anchored shopping center, multifamily apartment community, warehouse/distribution, or industrial property valued anywhere from $5 million to $150+ million. Investors can also diversify their equity among several property types and geographic locations through fractional ownership.
Related Questions
- I heard partnerships do not qualify as "like kind" property for a 1031 exchange. How does the purchase of a Tenant In Common (TIC) interest differ from a partnership?
- What is the difference between investing in a Tenant in Common 1031 exchange and simply exchanging for another sole owned property?
- What is a Tenant In Common property?
