CPA-led 1031 exchange guide
1031 Exchange for Commercial Property
Commercial 1031 exchanges follow the same rules as residential exchanges, but the dollar amounts are larger and the equity-debt math is usually more complex. CPA-led coordination is most valuable here.
Asset classes that qualify
- Office buildings
- Retail and shopping centers
- Industrial and warehouse properties
- Mixed-use properties
- Self-storage and specialty assets
Debt matching on larger transactions
Commercial relinquished properties often carry seven or eight figures of debt. Replacement debt has to match (or be offset by new cash) to avoid mortgage boot. Lender timing in the 45/180 window is critical.
Asset class shifts
A commercial 1031 is a clean way to reposition — out of management-heavy retail into industrial, or out of a single tenant into a diversified portfolio. Brandon helps model the basis carryover and depreciation reset on each scenario.
Frequently Asked Questions
Can I exchange one large property for several smaller ones?
Yes. Subject to the identification rules, you can split a single relinquished property into multiple replacement properties.
What about NNN leased commercial?
NNN-leased real estate qualifies as long as you're acquiring the real property interest (not just a fund or partnership interest). DSTs are a separate topic and not covered on this page.