Ten years ago, the syndicated 1031/TIC market was exploding with roughly 75 real estate sponsors raising over $4 billion in equity, then came the Great Recession and the industry more or less shut down, with many of those sponsors (and the independent broker-dealer firms who marketed the product) closing down with it. We know the economy is cyclical, so it should come as no surprise to see the 1031/TIC industry slowly begin to show signs of life with improved economic indicators, low interest rates, and rising real estate values. While few real estate investors had any interest in exploring 1031 like-kind exchanges five years ago (for obvious reasons), many investors are now seeing sufficient improvement in the performance of their investment real estate portfolios that, once again, Section 1031 is worth considering as a strategy to defer capital gains tax upon the sale of investment real estate. Industry experts are reporting increasing activity in the Reg. D private offering market, with approximately 20 sponsors actively raising capital for DST or TIC programs in 2016.
For those interested in learning more about real estate syndications and what it takes to be a TIC sponsor, here’s an article I wrote in 2009 offering a few tips, most of which remain as important today as they were back then. Perkins Law is pleased to offer flat fee service packages for both sponsors and investors active in the Reg. D private offering industry.