What actually counts as like-kind in a 1031 exchange
Like-kind property in a 1031 exchange does not mean "the same type of property." It means any United States real property held for investment or business use, and all of it is like-kind to all the rest of it.
This is the #1 misconception in the entire 1031 world, and it stops investors from making their best move: leaving a tired asset class for a better one.
What Exchanges Into What
The regulation (Treas. Reg. 1.1031(a)-1(b)) construes like-kind broadly for real property. The real limits: since the 2017 tax law, 1031 covers real property only (no equipment, no crypto), it must be held for investment or business use, not personal use, and foreign property doesn't pair with US property (IRC 1031(h)).
- Rental houses → industrial. Qualifies.
- Apartment building → office, retail, or warehouses. Qualifies.
- Raw land → cash-flowing small bay industrial. Qualifies.
- Farm or ranch → multi-tenant flex space. Qualifies.
Why This Matters
Whatever you're selling (duplexes, a strip center, farmland), the exchange rules put multi-tenant Texas industrial fully on your menu. The asset class you exit has nothing to do with the one you enter.
Current replacement property inventory
The Brown Portfolio
Houston, TX · Small Bay Industrial
$7,760,000
57,565 SF · 100% occupied
East Houston Shallow Bay Portfolio
Houston, TX · Small Bay Industrial
Contact for Pricing
· 100% occupied
Highway 30 Business Park
College Station, TX · Small Bay Industrial
Contact for Pricing
186,225 SF · 94.5% occupied
Common questions
Can I exchange one property for several?
Yes, and vice versa. One sale can fund multiple replacements, subject to the identification rules.
Does a vacation home qualify?
Only if it's genuinely held for investment. Personal-use property fails the test: there's a 24-month rental safe harbor (Rev. Proc. 2008-16) that cleans this up.
Can I exchange into property I'll improve?
Yes, improvement (build-to-suit) exchanges exist, with extra structure. The 180-day clock still rules everything.
Ready to deploy your 1031 capital?
Call us at 717-553-6888 or send an inquiry. We coordinate the exchange from identification to closing.
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