Realized 1031 Glossary of Terms

721 UPREIT Exchange

Written by The Realized Team | Jun 20, 2022 12:00:00 PM

721 UPREIT exchange results in the same tax deferral benefits that are achieved as with a 1031 exchange. Capital gains taxes are deferred until such time as the exchanger sells the Operating Partnership Units (or OP Units), converts the OP Units to REIT shares or the acquiring operating partnership sells the contributed property.

The exchanger may receive the additional benefit of converting their interest in one or more properties into a larger property portfolio. However, a UPREIT transaction is not available to all exchangers, as the relinquished property must be an asset the REIT or operating partnership wishes to acquire. See UPREIT.