Infinity Commercial Real Estate Group - Investment Solutions: 1031 Tenants-In-Common (TIC)

Infinity offers advantages in providing 1031 Tenants-in-Common (TIC) Replacement Properties that others don’t.

Our program provides real estate buyers with the monthly rental income advantage of a triple-net (NNN) leased, single-tenant property with the appreciation advantages of a multi-tenant property. By owning Tenants-in-Common (TIC) interest in multi-tenant commercial properties across a wide geographical area, real estate buyers can enjoy the diversification that is not possible if you were to buy just one single location property.

The Infinity plan is well suited for the 1031 exchange buyer seeking monthly income, unlimited appreciation potential, and flexible and quick closings. In short, you get the advantages of a long-term, triple-net lease without the disadvantages.

Granted, if you fail to close you can pay your capital gains tax. Failure to close is the top reason clients reveal as to why they pay capital gains tax. But by identifying a TIC property, you can reduce your potential tax risk, and avoid a failed closing!

Features
With the Infinity program, you get great properties with no closing costs. Closings can occur in 10 business days or less if required.

Buyers can purchase Tenants-in-Common (TIC) interests exactly equal to their available cash equity in one or more 1031 exchange properties.

The typical entrance into the whole building, income-producing real estate market generally begins at about $1 million, preventing most 1031 exchange owners from participating in this market. But a TIC ownership allows the average buyer to participate with others in ownership of larger properties through a minimum purchase as low as $150,000. Whole property purchases are also available.

Diversification in several properties is possible. Many properties and debt LTV's are available.

Begin your Infinity real estate experience today.

1031/Tenants-in-Common (TIC) Facts

1031/Tenants-in-Common (TIC) Information

FREQUENTLY ASKED QUESTIONS

In a nutshell, what is TIC ownership?
What investment amounts are ordinarily required for TIC ownership?
What happens if I fail to close on my 1031 exchange?
Is there any liability exposure associated with TIC ownership?
What if I want to sell my TIC ownership?
What happens to my TIC ownership if I die?
What are the terms of the NNN PLUS lease?
What if the lessee defaults? Are there any remedies?
Can I terminate the lease?
How can a NNN PLUS lease benefit me?
How much confidence can I place in a NNN PLUS lease?
What are NNN Properties?

Question: In a nutshell, what is TIC ownership?
Answer: TIC ownership combined with NNN leases provide the real estate buyer with the advantages of ownership in a larger property, cash flow and annual depreciation benefits without many of the day-to-day management problems associated with individually owned rental property.

Question: What investment amounts are ordinarily required for TIC ownership?
Answer: Revenue Procedure 2002-22 issued by the IRS allows up to 35 TIC owners in any one property. Minimum purchase requirements are structured to meet this limitation and can range as low as $50,000 equity. The typical investment in whole commercial building begins at $1 million, but through TIC ownership, the average person is able to enjoy ownership in an institutional-type property with a minimum investment. Besides reliable income and growth potential, these properties are able to attract tenants with greater financial strength and stability than possible for the individual landlord.

Question: What happens if I fail to close on my 1031 exchange?
Answer: You will have to pay your capital gains taxes. Failure to close is the top reason clients reveal as to why they pay capital gains. By identifying a TIC property, you can reduce your potential tax risk, and avoid a failed closing. If you fail to close on other identified properties, you are able to move all your proceeds into the TIC property you identified.

Question: Is there any liability exposure associated with TIC ownership?
Answer: The mortgages on most of the TIC properties offered by Infinity are non-recourse. The TIC debt structure generally allows for the debt financing to be assumed. Assumption usually occurs without the need for qualification or loan assumption fees.

Question: What if I want to sell my TIC ownership?
Answer: On a decision requiring unanimous vote, such as a sale decision, a 60% - 75% (depending on your TIC agreement) vote by the TIC owners will be sufficient to initiate the impasse resolution procedure. This procedure allows the TIC owners with 60% - 75% (depending on your TIC agreement) or more of the property to make an offer to buyout the dissenting owner with 25% or less of the property. The dissenting TIC owners can either: (1) accept this offer, (2) buy out the 60% - 75% (depending on your TIC agreement) TIC owners at the same price per percentage ownership, or (3) change their dissenting vote to a consenting vote.

Question: What happens to my TIC ownership if I die?
Answer. Your ownership interest will pass to your heirs pursuant to your will just like any other asset. They will also receive a stepped-up tax basis to fair-market value. The income taxes, which were deferred because of your 1031 exchange, are forgiven forever.

Question: What are the terms of the NNN PLUS lease?
Answer: It is a 20-year lease (note: the lease has an option to terminate after 10 years).

Question: What if the lessee defaults? Are there any remedies?
Answer: In the event that the lessee becomes insolvent or files for bankruptcy, fails to pay when due any rent or any other payment pursuant to the lease, fails to comply with any term, covenant, or provision of the lease, or acts in a way that results in a lien being filed against any portion of the leased premises, the lessee shall be deemed in default under the lease (subject to reasonable cure provisions). In the event of a default, the TIC owner may terminate the lease, take possession of the property, or take actions to cure the default without liability to the TIC owner and with rights to recover any damages including unpaid balance of rent for the entire term.

Question: Can I terminate the lease?
Answer: The NNN PLUS lease terminates at the sale of the property in its entirety or whenever the TIC owners vote to terminate it.

Question: How can a NNN PLUS lease benefit me?
Answer: A NNN PLUS lease - its simple.
S - Shelter income through depreciation.
I - Increased cash flow.
M - Meet objectives.
P - Preservation of equity.
L - Leverage your purchasing power.
E - Eliminate day-to-day management chores.

Question: How much confidence can I place in a NNN PLUS lease?
Answer: Because of the NNN PLUS lease, you have a lessee with an established history of commercial property management experience and financial wherewithal. Institutional-grade TIC properties attract tenants with greater financial strength and stability than is possible for the individual landlord.

Question: What are NNN Properties?
Answer: NNN properties refer to properties that are under a triple-net or NNN lease in which the tenant is to pay all operating expenses of the NNN properties. At FOR 1031, we offer a NNN PLUS lease to our clients. Our lease offers more advantages than a NNN lease. The NNN PLUS lease is a NNN lease in which the lessee completely leases the replacement property under an escalating lease payment plan. The lessee takes on the responsibility to sublet the property. In addition to rent, taxes, insurance and maintenance, the lessee also pays the debt-carrying expenses.


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