Internet Commercial Realty Advisors (ICRA)©, a global network of experienced Real Estate investment advisors, specialize in 1031 exchanges and reverse exchanges throughout key markets in the U.S.  The ICRA© professionals will provide you with comprehensive analysis on your current cash flow and  equity vs. debt position,  as compared to alternative investment 1031 tax free exchange opportunities.

Exchange Analysis

Return on Equity Comparison
 
Current Property
Exchange property
Property Address
12345 Ocean Avenue
6060 A Street
City, State
Torrance, CA
San Diego, CA
Estimated Value
$11,000,000
$25,500,000
Existing Financing / Loan Amount
$1,987,000
$17,000,000
Cap Rate
5.45%
6.50%
Loan to Value %
18.06%
66.67%
Equity / Cash Down Payment
$9,013,000
$8,500,000
Closing Costs / Rehab
N/A
$300,000
Total Capital Investment
N/A
$8,800,000
% LTV Equity / % Total Capital
81.94%
33.33%
Interest rate
6.000%
6.125%
Amortization
120
360
Net Operating Income
$600,000
$1,657,500
Debt Service
($264,717)
($1,239,526)
(a) Pre-Tax Cash Flow
$335,283
$417,974

% ROE (Cash on Cash Return )
3.72%
4.75%

(b) Principal Reduction
$149,606
$203,937
(c) Depreciation
$61,000
$650,000
Taxable Income
$423,889 (a+b) -c
($28,089)
Estimated Tax Bracket
33%
33%
Estimated Tax Liability
$139,883
($9,269)
*After Tax Cash Flow
$195,400
$427.244
*After Tax Return on Equity
2.17%
5.03%
PROS & CONS / COMMENTS
12345 Ocean Avenue
6060 A Street
Older building (74 unit apartment building
New building (140,000 sqft class A office building)
Management intensive (short term leases)
Triple net lease with professional tenant profile
Replacements, appliances and roof at end of useful life cycle
N/A
Excess income tax liability
Maximized income tax liability
ROE below inflation rate with low risk investment
ROE above inflation rate with mid leveraged investment
* Always consult with your income tax professional or CPA for verification on your income tax scenario