Exchange Accommodators

A Build-To-Suit or Construction Exchange allows you to sell your old property and use that money to buy a piece of raw land and build a building on it.

For Exchange Accommodators, providing security for your assets is our first priority. Here’s how we do it:

First: We create and register a single-asset corporation, which is not lienable outside of this transaction, to serve as the Exchange Accommodation Titleholder or EAT. The EAT is used only for your exchange.

Second: We secure your investment. To ensure repayment of financing to you or the lender, Exchange Accommodators and our attorneys create the appropriate security instruments, including a promissory note and a deed of trust or mortgage.

Third: We enter into binding contracts that ensure the transfer of the new property to you and restricts the EAT from borrowing against the property.

Many believe only investors of large commercial properties can utilize the benefits of section 1031. The great thing about 1031 Exchanges is that it applies to all investment properties, large and small. It will work the same way for a corporation selling a large shopping center as it would for an individual selling a single-family home used as rental property in a vacation area.

Many believe you must acquire property of “similar use or service”. While 1031 Exchanges are also known as “like-kind” exchanges, “like-kind” simply applies to real property held for a business use or investment. Therefore, an investor may sell raw land and acquire a five-unit apartment building or sell a warehouse and acquire raw land. He can sell one property and acquire three or sell four and acquire one. Virtually any type of real property used for business or investment will qualify.

Many believe 1031 Exchanges are very complicated and not worth doing. The fact is that when working with a Qualified Intermediary who specializes in Section 1031 tax-deferred exchanges, the exchange process is very simple. The intermediary will keep you aware of your time deadlines and ensure you do everything in strict compliance with IRS regulations.