National Association of Realtors (NAR) issues an exemption letter to the Securities and Exchange Commission (SEC) which may revolutionize the commercial real estate industry

Since 2002, when the IRS issued official guidance in Revenue Procedure 2002-22 on how Tenant In Common investments would qualify for replacement property under Section 1031, the TIC Industry has exploded into a multi-billion dollar a year business. However, ever since 2002, the vast majority of TIC investments have been sold through the securities industry by licensed securities representatives and broker-dealers, not though the traditional means of licensed real estate professionals. Needless to say since 2002, the National Association of Realtors (NAR) and the real estate community has felt left out on these transactions and on October 11, 2007, NAR issued an exemption letter to the SEC on behalf of it’s 1.3 million members. This exemption request to the SEC would grant commercial real estate professionals with “substantial experience” in commercial real estate transactions, exemption from broker-dealer registration requirements of Section 15(a)(1) of the Securities Exchange Act of 1984. This exemption, if adopted in its current form would permit the real estate professional to obtain an advisory fee from the purchaser of a Tenant In Common securities investment that would be offered and sold together with other arrangements that would cause it to be deemed a security under federal securities law.

Click Here to view the NAR/SEC Exemption Letter in its entirety

As the TIC Industry and its new regulations evolve 1031 Alternatives Group remains committed as your Tenant In Common (TIC) strategic planning partner. Our website www.1031alternatives.net will be available to bring you the latest news and updates on this proposed exemption.

As a cooperative effort to educate the professional real estate community on the benefits and risks associated with TIC investments, 1031 Alternatives Group would be honored to conduct either an in-office educational presentation or a personal/small group consultation on TIC investments. Please feel free to contact our offices directly 866.405.1031 to schedule a date and time.