1031 Exchanges - How They Work

In commercial real estate, a 1031 Exchange—named after Section 1031 of the Internal Revenue Code—allows investors to defer paying capital gains taxes when they sell a property, as long as they reinvest the proceeds into a similar, or “like-kind,” property. This tool is especially valuable for investors seeking to grow their portfolio or reallocate assets without triggering an immediate tax liability. The like-kind requirement is broad, meaning an office building, warehouse, retail space, or even undeveloped land can typically be exchanged for another type of commercial property, as long as both are held for investment or productive use in a trade or business.

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Medical commercial real estate

Commercial real estate site selection for the medical field requires a strategic balance of data, accessibility, and community need. Healthcare providers must consider proximity to hospitals, patient demographics, traffic patterns, insurance coverage rates, and growth projections when choosing a location. Regulatory factors, zoning, parking availability, and future expansion potential also play a significant role in long-term viability. A successful site meets current operational demands and also positions the practice for sustainable growth and ease of access for patients.

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Commercial real estate as an investment

Commercial real estate (CRE) is a powerful investment vehicle that offers both income-generating potential and long-term asset appreciation. Unlike residential properties, commercial assets—such as office buildings, retail centers, medical facilities, or warehouses—often come with longer lease terms and higher rental yields, which provides investors with steady cash flow. Additionally, these properties can serve as a hedge against inflation, as rental rates typically rise with the cost of living. Strategic location, tenant quality, and property management all play key roles in maximizing returns. While the entry costs and risks can be higher, commercial real estate remains a cornerstone of diversified investment portfolios for those seeking stability, equity growth, and tax advantages.

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