The thing with real estate is that there are very unique factors that can make a deal work or not work. 

You need to put that cash to work to create true wealth and create cash flow.

I have done a bit of searching about this on here and have not been able to find a consolidated thread on the advantages/disadvantages and protections needed for both parties in the process.The property is unique and I would plan to have it as a long term rental as it provides good cash flow and will be even better if I can add an additional unit as planned.I am looking to possibly do this on a small multi family property. 

To fully cure the encroachment, you will likely have to file a new legal description for both properties and reset the boundary lines, or create new parcels with the encroached areas.All of this can be dealt with - but it's going to take time & money and most importantly, cooperation between all the parties. 

If you have a mortgage on the property, not repairing might not be an option, and than there is ordinance compliance, that could create issues with leaving the property abandoned, may require rebuild or site clean up.    

@Margaret Buoncora,  If these are sold individually then each one of them constitutes a separate 1031 exchange with it's own unique timelines and reinvestment criteria. 

In assessing the use of equity you must also understand that due to the opportunity value of cash buying cash flow with equity to create artificial cash flow is extremely expensive.

Yes Robyn - we have access to this category in Florida - and they are typically 'off-market' deals... we can narrow parameters once we get to know each other better (matching goals to available properties, and creating a strategy.)

If that were the case then it would create a race to the bottom of who could sell first, Especially with prices out here being inflated.

Instead, implement your strategy and create your luckdont' sweat being canned.