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| home > 1031 t.i.c. structures > fractional t.i.c. ownership |
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| Fractional T.I.C. Ownership |
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Fractional real estate ownership offers a variety of features making it an attractive alternative
for the sophisticated real estate investor.
Access to Higher Grade Properties
The typical cost to entry in purchasing quality commercial property begins
at well over $1 million. T.I.C. structured investments however enable the average successful person to participate
in institutional-quality property with a minimum cash position. Furthermore, investment grade properties attract
tenants with greater financial strength and stability than properties limited to the buying power of the individual investor.
Combined Real Estate Experience
As an alternative to sole ownership of real estate, a T.I.C. or 1031 buyer can
participate in the ownership of large commercial property along with other unrelated buyers, not as limited partners,
but as individual owners. Each member of the T.I.C. structure brings their previous real estate knowledge to the group.
Thus, each decision of the T.I.C. ownership will be backed by many years of real estate experience.
Simple Mailbox Management
The T.I.C. owner avoids the time-consuming frustration of dealing with tenants.
You no longer deal with "toilets, tenants and trash." You simply receive your pro-rata monthly rental distribution directly from your mailbox.
Exact Dollar Matching
A T.I.C. structured investment enables you to match your investment needs to the dollar.
For example, if you have USD 163,953 of equity from the sale of a previous property you can match the amount by reinvesting
USD 163,953 in a T.I.C. investment.
Low Minimums
Revenue Procedure 2002-22, issued by the IRS, allows up to 35 TIC owners in any one property. Minimum
purchase requirements are structured to meet this limitation and can range as low as USD 50,000 equity.
Non-recourse Financing
The mortgages on most T.I.C. structured properties offered by
AmCorp Realty Corporation are non-recourse. The T.I.C. debt structure generally allows for the debt financing to be assumed.
Assumption often occurs without the need for qualification or loan assumption fees.
Diversification
As a result of low minimum cash requirements in T.I.C. structured properties, investors can decrease potential risk by
diversifying into multiple properties in various geographical locations.
Deeded Interest
T.I.C. owners receive an insurable deeded interest in the property that may be transferred independently of the
other co-owners. This may be in the form of a gift, sale, inheritance, assignment, etc.
Distributions
T.I.C. owners receive their pro-rata monthly distributions of net rental payments, sale proceeds as well as depreciation
tax benefits in proportion to their percentage ownership in the property.
Disclaimer: The above brief description is not to be construed as legal or tax advice and is qualified in its entirety by the actual
closing documents. In case of any discrepancy, the actual closing documents will control.
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