Make your equity work harder than it currently is.
Whether you're trading a management-heavy California rental for passive out-of-state income, or building a portfolio from scratch, the analysis has to start with verified numbers and end with a clear-eyed view of risk.
Three things we check before anything else.
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Underwrite Actuals, Not Pro Formas
The offering memorandum shows stabilized projections. We build the model from trailing twelve-month statements, the actual rent roll, CAM reconciliations, and estoppels. The gap between those two numbers is where most investors lose money.
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Rollover & Concentration Risk
A 7% cap rate means nothing if 60% of the income rolls in the same eighteen months, or if one tenant carries half the rent. Lease expiration staggering and tenant credit matter as much as the going-in yield.
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Real Market Selection
Population growth, household income trend, employment drivers, and new supply — not headline cap rate. A 6% cap in a growing submarket outperforms an 8% cap in a shrinking one, every time.
Deferring the gain instead of paying it.
A Section 1031 exchange lets you trade one investment property for another and defer capital gains — but the deadlines are statutory and the sequence matters enormously. Planning starts before the listing goes live, not after an offer arrives.
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Plan Before You List
The qualified intermediary must be engaged before the relinquished property closes. This is the single most common way exchanges fail.
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Close the Relinquished Property
Proceeds go to the intermediary, never to you. Touching the money disqualifies the exchange entirely.
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Identify Within 45 Days
Written identification of replacement candidates. The clock starts at closing and does not extend for weekends or holidays.
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Close Within 180 Days
Acquisition must complete within 180 days of the relinquished sale, or by your tax filing deadline — whichever comes first.
Where exchanges go wrong.
Almost every failed exchange we've seen failed for one of these reasons — and every one of them was avoidable with earlier planning.
Exchange Requirements
- Replacement property must be like-kind — broadly defined for real estate, but the property must be held for investment or business use
- Identify up to three properties of any value, or more under the 200% and 95% rules
- To fully defer, replace both the value and the debt — taking cash out creates taxable boot
- Deadlines are statutory and effectively unforgiving; there is no extension for a deal falling through
- California claw-back applies when exchanging out of state — the deferred gain is tracked and eventually owed
We are real estate brokers, not attorneys, CPAs, or tax advisors. Nothing here is tax or legal advice. Every exchange should be structured with a qualified intermediary and reviewed by your own CPA and attorney before you commit.
Three deals, start to finish.
Real transactions we've handled — the situation, what we did, and how it turned out.
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Moving Out of California — A 1031 Exchange
A South Orange County owner traded an appreciated but management-intensive California rental for out-of-state income property, deferring capital gains entirely through a 1031 exchange.
Read the case study -
Shopping Center Investment — Peoria, AZ
Sourcing and closing a multi-tenant retail center in a growth market outside California, underwritten on real operating numbers rather than the seller's pro forma.
Read the case study -
Business Park Investment — Peachtree City, GA
A multi-tenant business park acquisition in a Southeast growth corridor, structured for stable industrial and flex-space income.
Read the case study
Thinking about an exchange?
Call before you list. Once the relinquished property closes without an intermediary in place, the exchange is gone and there is no fixing it.