Exit Navigator™
Exit strategy: sale, 1031, DST, and recapitalization
Your exit is a menu, not a single decision. An outright sale is one item on it, and it is not always the right one.
The question underneath all of it stays the same: what is the right exit for your goals and your tax position? Exit Navigator works that question first, then executes the answer.
Where the decision starts
I start where I always start: your business plan for the property, your goals, and your financials. The exit follows from those three inputs. Sell too early and you hand a buyer the upside you built. Sell into the wrong tax position and the IRS takes a cut you could have deferred.
Those are not real estate problems alone, which is why the first job is to get the right people in the room before anything is listed.
The ways out
Sell outright. A buyer does not pay for the income your building earns. A buyer pays for the income they can verify from your documents and expect to keep collecting. Anything they cannot verify, they discount. Anything that resets on a sale, such as the tax assessment or the insurance premium, they underwrite at their own number. The work is to close that gap before the building goes to market: restate the numbers the way an underwriter will, make the leases match the rent roll, and find deferred maintenance before an inspector does.
1031 exchange. Roll the proceeds into a replacement property and defer the capital gains tax, instead of paying it on the way out. Owners use it to trade up into a larger building or to consolidate several into one. The clock is strict, 45 days to identify a replacement and 180 to close, and the proceeds have to pass through a qualified intermediary rather than your own account. My part is finding and underwriting the replacement property. Your CPA and the intermediary own the tax and the mechanics.
Delaware Statutory Trust. A DST is a passive 1031 landing spot for the owner who wants out of active management but still wants to defer the tax. You exchange into a fractional interest and stop taking the tenant calls. It is a securities product, so a licensed securities representative sets it up, not me. My part is the real estate exit that gets you there, and whether trading out of active management fits your goals.
Recapitalization. Bring in a partner or fresh capital instead of selling, when you want to stay in the building but need liquidity or a reset. You keep the upside you still believe in and take some chips off the table. If the goal is to pull equity and keep the building outright, without a partner, that is a refinance, and Refinance Navigator covers it.
Who does what
I am a real estate advisor and broker. I am not a tax advisor, an attorney, or a securities representative, and this page is not tax or investment advice.
What I do is help you weigh the options against your goals, prepare and position the real estate, identify replacement property for a 1031, and quarterback the team around you. The qualified intermediary runs the exchange. Your CPA runs the tax. A licensed securities advisor handles a DST. I own the real estate side and keep everyone moving to the same timeline.
If the exit is a sale, I can represent you as the seller. The multifamily brokerage page explains how I sell 4 to 50 unit apartment buildings.
Start with the free scorecard
The Exit Navigator Scorecard answers the two questions before you commit to any exit: is anything forcing the decision, and would your file survive a buyer’s diligence. Ten minutes, confidential.
Request a building audit
Send the property address and your last twelve months of operating statements. I read them before we speak. The first call is free. Any engagement after it is scoped and quoted in writing before work starts.
Request a building audit and pick a time on the next screen.
Mobile 202-290-1055. Office 202-800-3200. Email shirani@enterprisere.com.
Common questions
What are my options besides selling outright?
Four main ones. Sell. Roll the proceeds into a replacement property through a 1031 exchange and defer the tax. Exchange into a Delaware Statutory Trust if you want out of management but still want to defer. Or recapitalize, bringing in a partner or fresh capital instead of selling. If you want to pull equity and keep the building outright, that is a refinance, not an exit.
Do you handle the 1031 or the DST yourself?
No. I am a real estate advisor and broker, not a tax advisor, an attorney, or a securities representative. A qualified intermediary runs the exchange, your CPA runs the tax, and a licensed securities advisor handles a DST. My part is the real estate and quarterbacking the team so everyone works to one timeline.
What does "sale ready" actually mean?
If an outright sale is the right exit, it means a buyer's underwriter can verify your income and your expenses from the documents you hand over, without discounting for uncertainty. Readiness is a documentation and operating standard, not a cosmetic one.
When should I start, relative to when I want to exit?
Earlier than owners expect. Inside twelve months the work is mostly assembly and presentation. Beyond twelve months you can still change the operating numbers themselves, which is the more valuable window.
Does this only apply if my building has problems?
No. A well-run building still gets discounted for income a buyer cannot verify, and its document file has the same gaps as any other. A strong operating record is worth exactly as much as your ability to evidence it.
Do I have to list with you to get this review?
No. The advisory work and the listing decision are separate. The review can conclude that holding, refinancing, or fixing the operating numbers first is the better move, and I will tell you that.
What documents will you ask for?
The current rent roll, the leases and renewals behind it, twelve to twenty-four months of operating statements, the tax bill, the insurance declarations, service contracts, utility bills, and records of capital work done.
What most often takes money off the price during due diligence?
Income that cannot be evidenced, expense lines that reset for a new owner, deferred maintenance found at inspection, and lease files that do not match the rent roll. Each one is fixable before the building goes to market, and expensive to argue about after a contract is signed.
Should I sell at all right now?
That depends on your loan, your basis, your tax position, and what you would do with the proceeds. Bring all four to the audit and we work the question properly, rather than starting from an assumption that the answer is yes.