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ARTICLE - Other
Investor Considerations by
Robert Poe First and
foremost, always seek competent tax counsel when
deciding to sell your commercial real estate. In
addition to capital gains taxes, commercial real
estate sales also involve taxes on income, the
property itself, and non-cash expenses. These
need to be carefully analyzed in order to
determine your tax liability upon sale. Having
an appraisal done on the commercial property can
help in evaluating your potential taxes.
A 1031 exchange
can help you defer many tax liabilities. It’s
wise to determine what you want in a replacement
property before you list your property for sale.
There is a specific timeframe for 1031
exchanges-you don’t want to lose the opportunity
to do a 1031 exchange due to lack of planning.
You should also
know your motivation for selling. Is it to gain
liquidity? To free up funds for another
commercial investment? And how quickly do you
want to sell? In other words, is your need to
sell immediate, or are you more motivated by
price than by time?
Finally, you
should seek the advice of a competent commercial
real estate broker who knows the market and can
price your property accordingly. The broker
should have experience with the type of
commercial property you wish to sell and should
be able to provide you with details about
comparable properties that are currently on the
market and that have sold recently.
- Submitted by
Robert Poe, CCIM, Certified Real Estate
Professional |
