Case Study

• Client had a significant 1031 exchange, in excess of $70m of assets to acquire
• Was looking for well-located, high quality assets in tax-free states.
• He has one week to identify roughly $10m of the remaining exchange or face significant tax consequences.
• Dollar Tree and Tire Discounters rent had not commenced, therefore further complicating the sale

• Put the property under contract in two manners; One contract for the ‘boxes’ – Aldi, Dollar Tree, Petsmart and Marshalls – and one contract for the Tire Discounters out parcel.
• If Dollar Tree rent had not commenced by the time the Buyer needed to close, a rent credit was negotiated.
• Since only $10m of the exchange was remaining, we bifurcated the closings. That would assure the exchange would not be put in jeopardy but also allow the buyer to acquire the out parcel, something that was very important to them.

• We closely tracked Dollar Tree’s progress and they were able to open in time for the first closing.
• Due to certain weather delays we ended up closing on the Tire Discounters property in the following months.
• The Buyer incurred no tax liability from this portion of the acquisition and was still able to acquire a majority of the shopping center.