All Forum Posts by: Alyssa Dyer

@Todd Young, It's a very delicate gas pedal/brake pedal exercise and much really depend on your lendability and pace at which those current units will sell not to mention the availability for a building that you're looking for.

From the sounds of it, Locating the building will be the toughest part. So that is probably the best place to start. Job 1 - find the new property. At the price point you're looking at the purchase schedule becomes more prolonged naturally with acceptance of the LOI, and then the back and forths of inspection finance and other contingencies. You could have several months from contract to close. And from the sound of things that would be a lot of time to sell your current properties - even as individuals. And consolidate those 1031s into the one purchase. Of course it's always easier to explain than to perform :)

A couple ways to mitigate other than what youve already described (the portfolio sale etc) would be

1. Find a mezzanine financing entity that will provide the interim financing.  Not that you would use this for purchase because because you have to close your sales before you close your purchase.  But a lender of this type might be persuaded to take a security interest in your current properties in exchange for providing a very healthy earnest money payment and letter indicating your lendability for the rest.  I  think a seller might look at that favorably.  

2. A reverse exchange is another twist on the above.  If it comes down to having to commit to the new property first, then locate mezzanine or straight up private financing for the purchase.  You can cross collateralize with both the new property and your old properties.  The EAT of the QI takes title to the new property.  And you have 180 days to sell as many properties as you can to 1031 into that property.  We can also shape that reverse exchange to accommodate a value add component to the new property using 1031 proceeds which is a huge bonus.

And during that 180 day period your are generating the income from both the new property and the old properties that haven't sold.

It's not the easiest transition.  But the runway you can create toward a $10 mil purchase might surprise you. 

@Alyssa Dyer

Unfortunately everything has slowed down for the time being due to my wife approaching me requesting a divorce. I'm still looking and listening, but worried about potentially losing half so I'm just holding off for now and planning finances without her in the picture.