Understanding 721 Exchanges (UPREIT) and 1031 Exchanges
For investors considering a tax-deferred exchange, a 721 Exchange (UPREIT) may be one option worth evaluating as part of their overall investment strategy.
For most investors ending up in an UpREIT is a two-step process.
The first step is to invest in a Delaware Statutory Trust (DST). Imagine you sell a property and want to defer taxes. A DST lets you invest in a big professionally managed property like a class a apartment building or industrial building alongside other investors. You own a piece without the hassle of managing it. You can choose a DST created by a REIT company that has an option to buy the property back from you as soon as 2 years after the DST is filled. If the REIT uses this option, they will swap you out of the DST and into the REIT by giving you operating partnership units in the REIT. You will move from a DST consisting of one property and end up in a REIT with potentially hundreds of properties and billions of dollars of diversification. You will retain your tax deferral benefits and continue to receive income from the REIT. One year after converting into the REIT you may have the option to sell shares if you need liquidity. This could come in handy for estate planning purposes.
A 721 Exchange offer many benefits including tax deferral, income & diversification, and potential liquidity.
Is a 721 Exchange (UPREIT) Right for Your Investment Strategy?
Contact us at (949) 722-1031 or schedule a consultation to explore how 1031 DST Solution presented by Corcapa 1031 Advisors can deliver a successful exchange tailored to you.
About 1031 DST Solution Presented by Corcapa 1031 Advisors
Founded in 2011, Corcapa 1031 Advisors is a boutique financial advisory firm specializing exclusively in 1031 exchanges and tax mitigation strategies. A recognized leader in alternative real estate investments, our firm focuses on Delaware Statutory Trusts, Tenant-in-Common programs, sole-ownership transactions, and 721 UPREIT structures. Corcapa 1031 Advisors has successfully guided hundreds of clients through thousands of investments, facilitating over $1 billion in completed exchanges. With a dedicated focus on real estate solutions, Corcapa 1031 Advisors is a trusted partner for registered investment advisors and financial advisors nationwide who frequently refer clients seeking expert guidance on tax-deferred exchange strategies.
Securities offered through DAI Securities, LLC, Member FINRA/SiPC
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