How do I find 1031 Exchange Equity?

Question

Calling all 1031 Experts!

I am trying to learn more about the world of 1031 exchange.  We are a successful commercial self-storage operator out of Roswell, GA.  We typically syndicate our equity requirements for our acquisitions through accredited investors and institutional investors.

We have never done any TIC or DST and are very interested in learning more about how to find investors who are looking for 1031 like kind exchanges.  We have a very strong track record and I would think would be a very attractive opportunity for people looking to do an exchange.

Typically how do investors who are looking for an exchange find the next project?  Are they going through a QI or are there firms that specialize in these offerings?  My search on the Google didn't come up with any concrete examples....

Looking for some help from the BP community!!

Thanks for the help,

Kris

Dave Foster · Answer

@Kris Benson, You're looking for a "watering hole of the Serengetti" - you know the few  watering holes in the African plain that stay wet during the dry season.  All of the animals gather there.  Every 1031 exchange uses a QI.  Every sale of real estate uses a title company or attorney.  More and more investors are using property management firms.

DSTs and TICs are real estate products so you have to enter the marketing field as a competitor with other real estate products on the retail end - and that's a big field.

It's a tough nut.  You really do almost have to build it and hope they come.  The world of a 1031 doesn't leave time for an investor to wait.  They will choose from the available stock of fractional or NNN or wholely owned assets that are available during that 45 day window.

Alina Trigub · Answer

@Kris Benson

I'll let @Dave Foster, the 1031 Expert, provide his feedback.

So I will give my opinion/thought process on the topic. You mentioned that your current investors are either: accredited or institutional. With that in mind, would you consider for a potential 1031 exchange someone with $50K or even $100K?! Is it worth the effort?!  You may say the answer is: it depends on a property size, but I'd assume, you'd prefer avoiding having 15 or 20 TIC's. So there must be some minimum threshold for your firm to consider. Where I'm going with this is FO or wealth management companies. Another avenue to consider is reaching out to companies that specialize in Fractional Interest offering.

Either Dave F or I can introduce you to one.

Best!

Jeff Copeland · Answer

@Dave Foster

Account Closed · Answer

@Kris Benson there is a specific industry devoted to what you are asking.  I would suggest you start poking around with the broker dealers that specialize in this space as well as the current sponsors.  The broker dealer community raises the equity for the sponsors and interacts with the individual investors.  And yes to the other question, there are typically minimums required as well as investors have to be accredited.  It's not really a BP community topic so much as more advanced real estate investing strategy.

How do I find 1031 Exchange Equity?

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