1031 Exchange Benefits and Exchange Options

1031 Exchange Highlights

1031 Exchanges, as defined under section 1031 of the IRS Code, is a strategy that allows you to defer paying capital gains taxes on an investment property. Using a 1031 Exchange, you pay no taxes on an investment property when it is sold as long as another “like-kind” property is purchased with the gains.

It is, when properly structured and administered, a very effective and powerful way for you to shift the focus of your investments while being able to legally defer tax payments.

Grocapitus offers investors two types of investments to exchange into when doing a 1031 Exchange:

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Grocapitus apartment syndications

There is a common misconception that you can not do a 1031 exchange directly into a syndication. The good news is there are viable ways syndicators may facilitate a 1031 Exchange into their apartment syndications, but not all of them offer this capability. On select Grocapitus syndications we allow investors to exchange into the syndication.

1031 Exchange Into Syndication FAQ

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Grocapitus turnkey duplexes, triplexes, and fourplexes

For active investors that prefer 100% direct ownership, many of our Grocapitus turnkey rental property projects allow investors to use a 1031 Exchange to defer capital gains taxes when they buy in our of our build-to-rent multifamily communities consisting of fourplexes, triplexes, and/or duplexes.

We only invest in communities in carefully select locations using Location Magic, a unique data-driven real estate metrics and analytics system we pioneered. This system enables us to consistently build in up and coming metros and neighborhoods with strong market fundamentals, and provides our real estate buyers with handsome, tax-advantaged returns.

For more information about doing a 1031 Exchange into a multifamily syndication, watch this video with our lawyer, Dugan Kelley.

Would You Like To Discuss A 1031 Exchange With Us?

We can tell you about our upcoming 1031 Exchange eligible syndications and turnkey properties along with their timelines. We can also answer any questions you have.

1031 Exchange Benefits

Here are a few reasons you may want to consider replacing an existing rental property with another investment property:

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If the current investment property is not performing well

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To replace an aging property with a newer property

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To own a property that requires less maintenance or has better property management

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To scale a portfolio by freeing up cash to purchase a larger property

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To transition from single-family to multifamily

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To own a property in a better performing metro or neighborhood

But there are tax implications of selling your current investment property and then investing the proceeds in a new property. However, by utilizing a 1031 Exchange, you may be able to sell your current investment property and defer the capital gains by re-investing into another “like-kind” project.

What Our Investors Say About Us

Munaf K

"Grocapitus is not just your average passive real estate syndication. It’s a dynamic powerhouse of real estate investments with outperforming returns."

Gurpreet P

"Neal’s data-centric approach gives him a near oracle like insight into the vagaries of not just commercial real estate, but also macroeconomic trends as they impact microeconomic zones and industries."

Mark C

"What impresses me about Grocapitus is their quality research on every aspect of the market, their excellent communications and updates to investors, and their ability to add value to every property they touch."

Chong Z

"The team has the rare ability to identify unique, unusual opportunities for further improvements. They went extra miles to ensure that the investors get the best possible return."

Anshu S

"I invested in Grocapitus' project because I liked their data-driven approach to analysis and conservative underwriting. So far results have been delightful as the project has outperformed the projections and continues to perform well even during the coronavirus crisis."

Katrina J

“One of the things that I really like are the quarterly updates of the project. They keep you informed of what is going on with the project and point out both the good and the bad. You are never kept in the dark about your investment.”

Ivan Z

“I've invested in 6 of Neal's projects. As I write this, we just had the first successful exit: the Windward Forest Multifamily project, where we earned >20% IRR. I am very impressed by the multifamily projects performance."

Sarah L

“Neal and his team are awesome! I’ve invested in 8 projects with him and after 3 years we’ve already sold three. He’s outperformed other syndicates that I’ve invested with for much longer. I love getting his monthly updates."

Vengal D

“Neal does a lot of research using data analytics on markets, identifying growth areas, finding good neighborhoods and shares the data and his findings with interested people and clients. ”

Rob D

“The site and asset management teams at Grocapitus have worked hard to maintain occupancy, keep tenants safe, and delinquency low. Collectively, they have effectively managed expenses and incrementally increased rents to exceed NOI budget expectations.”

Avinash P

“As a Limited Partner to invest in a syndication, for me, trust is a big factor. With Neal's vast experience in multifamily construction, data-driven approach, and creative ways in solving problems as well as straightforwardness helped in creating the trust.”