1031 Exchange Strategies for Syndicators: Drop & Swap, Key Mechanics & How to Do It Right

He sold the apartment building, his investors got a big check — and then the IRS took a third of it. It didn't have to happen that way.

In this live Think Multifamily coaching call, real estate attorney Dugan Kelly breaks down the 1031 exchange drop and swap from the ground up — how syndicators can help their investors defer capital gains when exiting a deal, even when not everyone wants to participate.

In this episode you'll learn:

•       The held-for requirement — the biggest risk in a drop and swap, and why there's no bright-line IRS test on how long is long enough

•       The 45-day and 180-day deadlines — what they are, why missing them is fatal, and a real example of an investor who lost their exchange

•       How the drop and swap works mechanically: ballot process, TIC structure, deed, and title company execution

•       Why the entity going through the exchange should be the original one — and why creating a new entity increases audit risk

•       What to look for in a qualified intermediary — and why most have never handled a syndicated commercial transaction

•       How to review your operating agreement now, before your next exit, so you're not scrambling later

This is Part 1 of a two-part series. Continue with Episode 108P2 for advanced structures — swap and drop, split off, PIN method — and a live Q&A covering debt requirements, preferred return treatment, and QI horror stories.

Ready to invest alongside experienced multifamily operators? Join us at our next live event at thinkmultifamily.com/event.

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