Build-to-suit exchanges are a great alternative for people who want to conduct a 1031 exchange, but can’t find the perfect property. In this article, we are going to discuss the true benefits of build-to-suit exchanges.
How a Build-to-Suit Exchange Works
A build-to-suit exchange is similar to a typical forward 1031 exchange in that a relinquished property is sold and the net proceeds from that sale are redeployed into a replacement property (deferring capital gains taxes in the process). However, a build-to-suit exchange allows you to make construction improvements to your new replacement property during the exchange period. This can be especially helpful for people who cannot seem to find the perfect property to fit their needs. With a build-to-suit exchange, you can exchange into a property and make improvements to it so that it better meets your desires. The biggest catch is that any improvements you intend to make need to be completed within the 180 day exchange period. So don’t get too excited about any huge construction projects as you’ve only got 180 days total to complete any and all improvements.
Get Help with Your Build-to-Suit Exchange
If you’re ready to realize the tax-saving benefits of a build-to-suit exchange, reach out to the professionals at CPEC1031 today. With more than twenty years of experience, our qualified intermediaries have the knowledge and the expertise to help you through the details of your 1031 exchange. Reach out to us today to see if you are a good candidate for a build-to-suit exchange. You can find us at our primary office located in downtown Minneapolis.
Start Your 1031 Exchange: If you have questions about 1031 exchanges, feel free to call me at 612-643-1031.
Defer the tax. Maximize your gain.
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