Real Estate Advisor - What Not to Do In Like-Kind Exchanges

May / June 2019

What Not to Do In Like-Kind Exchanges

Court Finds Sale-Leaseback Strategies Produce Loans

The Internal Revenue Code has long allowed taxpayers to use like-kind exchanges to defer taxable gains. That doesn’t necessarily mean a like-kind exchange will go unchallenged by the IRS, though. This article summarizes a recent case in which the agency — and two federal courts — found the company’s property transactions more akin to loans than like-kind exchanges. A short sidebar demonstrates why appraisers must be allowed to reach their conclusions independently.

Exelon Corp. v. Comm’r, No. 17-2964, -2965, Oct. 3, 2018, 7th Cir.

Use Artificial Intelligence to Benefit

CRE Business

Artificial intelligence (AI) is bringing sweeping change to a wide variety of industries, and commercial real estate is ripe for this technology. From marketing to property management, AI could expedite processes and cut costs in a range of ways. But what exactly is AI? This article provides a primer.

How Nonrecourse Loan Carveouts Jeopardize Personal Liability

With the many types of loans available to borrowers, nonrecourse loans remain popular with borrowers because they can shield them from personal liability. But lenders will try to add “carveouts” to minimize that protection. If borrowers violate carveouts in the loan document, they may be left with full liability. This article highlights why both lenders and borrowers will negotiate nonrecourse loan carveouts, with borrowers looking to minimize personal liability.

Do You Understand the “Project Influence” Rule in Property Valuation?

Eminent domain allows the government to seize private land for public use. The U.S. Constitution requires the government to pay “just compensation” — generally the property’s fair market value — when it exercises this power. That’s where the project influence rule comes into play. This brief article summarizes the project influence rule, its valuation implications and its limited scope.

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