Family sells both business real estate assets and corporation in two separate transactions, and uses Kay Properties and the www.kpi1031.com marketplace to help defer taxes and provide access to real estate investment solutions
TORRANCE, Calif., May 18, 2022 /PRNewswire/ — Kay Properties & Investments, considered by many to be the nation’s largest Delaware Statutory Trust (DST) investments firms, announced it successfully helped a family complete several large DST 1031 Exchanges and a Qualified Opportunity Zone (QOZ) investment following the disposition of their business-related real estate assets and the business itself.
The combination of the DST and the QOZ investment successfully helped the family achieve three specific investment objectives:
- Defer significant capital gains taxes after selling multiple large industrial facilities where the business operated.
- Create a purely passive and management free real estate portfolio with the potential to generate monthly income.
- Build a significantly more diversified real estate portfolio with assets located across multiple geographic regions, throughout multiple real estate asset classes, and tenanted by multiple business verticals.
According to Dwight Kay, Founder and CEO of Kay Properties, while this transaction involved two separate types of tax deferral strategies, the primary focus was first to complete the 1031 exchange within the required timeframe.
“Because this was a large DST 1031 exchange involving multiple assets, the first thing the Kay Properties team of experts needed to focus on was to identify a number of replacement DST properties that fit into the investor’s long-term investment strategy,” said Kay.
These included a mix of multifamily, single tenant net lease, and medical that were located across multiple geographic regions, across multiple asset types with different tenants, and multiple DST sponsor companies.
Qualified Opportunity Zone
Following the successful completion of the Delaware Statutory Trust 1031 Exchange, the client then decided to sell the business in a separate transaction and invest in a Qualified Opportunity Zone (QOZ) as an additional tax deferral strategy.
Betty Friant, Kay Properties Senior Vice President is an expert in Qualified Opportunity Zone investment strategies and took the lead on advising the client on how to leverage the benefits of the QOZ vehicle.
“Before the qualified opportunity zone legislation, when you sold a business, you usually couldn’t write it off, and you had to pay your taxes. But with Qualified Opportunity Zones, if you have a capital gain from the sale of a business or stocks or other appreciated assets, you can defer the taxes on the gain of that sale and keep the basis to use any way you want. The Qualified Opportunity Zone fund must remain active for at least 10 years for the investor to receive a stepped-up basis on any gain from the opportunity zone project, so it might be possible that no taxes are due on those funds,” said Friant.
According to Friant, the ability to convert real estate assets into a tax deferred DST 1031 Exchange, and then convert the gains from the sale of the business into a QOZ is a direct example of why Kay Properties & Investments is considered one of the most experienced and hyper-client-focused real estate investment firms in the nation.
“Very few real estate brokers, CPA’s, or even real estate attorneys have as much experience in complicated 1031 Exchanges like this. We always encourage our investors to speak with their CPA and attorney for guidance regarding their particular situation and invite their CPA or attorney to be on the calls with the QOZ sponsor companies to learn more about how the QOZ works. In the end, we often have CPA’s and attorneys who personally invest with us on the www.kpi1031.com marketplace when looking for alternative investments that might provide real estate write offs, deductions, and tax deferrals,” said Friant.
About Kay Properties and www.kpi1031.com
Kay Properties & Investments is a national Delaware Statutory Trust (DST) investment firm. The www.kpi1031.com platform provides access to the marketplace of DSTs from over 25 different sponsor companies, custom DSTs only available to Kay clients, independent advice on DST sponsor companies, full due diligence and vetting on each DST (typically 20-40 DSTs) and a DST secondary market. Kay Properties team members collectively have over 150 years of real estate experience, are licensed in all 50 states, and have participated in over $30 Billion of DST 1031 investments.
*NOTE: Past performance does not guarantee future results and DST investments may result in a complete loss of investor principal. This is an example of the experience of one of our clients and may not be representative of the experience of other clients. These clients were not compensated for their testimonials. Please speak with your attorney and CPA before considering an investment
Diversification does not guarantee profits or protect against losses. All real estate investments provide no guarantees for cash flow, distributions or appreciation as well as could result in a full loss of invested principal. Please read the entire Private Placement Memorandum (PPM) prior to making an investment. This case study may not be representative of the outcome of past or future offerings. Please speak with your attorney and CPA before considering an investment.
There is a risk of loss of the entire investment principal. Past performance is not a guarantee of future results. Potential distributions, potential returns and potential appreciation are not guaranteed. For an investor to qualify for any type of investment, there are both financial requirements and suitability requirements that must match specific objectives, goals, and risk tolerances. Securities offered through FNEX Capital, member FINRA, SIPC.
Media Contact: Dwight Kay, 424-436-3526
SOURCE Kay Properties and Investments