Private Wealth Real Estate Services

Private Wealth Real Estate Services

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What’s Your Greater Purpose?

Warren Financial What's Your Greater Purpose
At Warren Financial, we find truth in the idea that you can achieve your financial goals when you have a Greater Purpose in mind, going beyond just financial security.  Our mission is clear: to assist our clients in achieving their financial objectives so that they can achieve their Greater Purpose.  Our commitment in this process is to place fiduciary responsibility above all else.
Our 1031 DST Real Estate Services and/or Opportunity Zone Services can work hand-in-hand with your CPA to unlock massive tax savings and significantly reduce your real estate management burden. Opportunity Zone services help defer, reduce, and provide tax free benefits when you sell appreciated stock, cars, wine, etc.

Real Estate Services

What is a 1031 Exchange

Whenever you sell a business or investment property and you make a profit, you generally have to pay capital gains taxes. A 1031 Exchange allows you to sell your real estate property; reinvest the proceeds in “like-kind” real estate, and defer the payment of taxes on that sale. The IRS defines like-kind property that is similar in nature or character, regardless of differences in grade, property type or quality.

Benefits of a 1031 Exchange include:

  • Tax Deferral
  • Diversification
  • Tax-advantaged cash flow
  • Wealth preservation
Adding DST to 1031 Exchange

Typically 1031 Exchanges are completed by the investment property owner with the help of a real estate broker, and accounted for in the tax return by the owner’s CPA. However, there is an alternative – a passive solution satisfying the 1031 Exchange – and that is a Delaware Statutory Trust (“DST”).


Warren 1031 DST Services

Adding DST to 1031 Exchange
Warren Financial adds the DST component to the traditional 1031 Exchange to provide the real estate owner with several major advantages. But perhaps the most attractive advantage of all to the owner is that the real estate becomes passive and the owner no longer has to actively manage the property.
This passive component can free up the owner’s time and resources and hand the day-to-day management reins over to professional property managers.
With its unique structure, a DST can offer many benefits:
  • Access to institutional quality real estate
  • Professional asset and property management
  • Passive ownership
  • Non-recourse institutional financing
  • Lower minimum investments
  • Ability to close quickly

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Warren 1031 DST Services

Example Scenario

Warren 1031 DST Services Example Scenarios

Scenario assumes the highest margin rates and does not reflect all possible state tax possibilities.
As with any investment, certain risks are involved including the risk that your
passive investment may not appreciate as hoped ormay lose value.


Warren 1031 DST Services

Who Uses Warren 1031 DST Services?

WF Greater Purpose - Business Woman on Cell Phone

Qualified Real Estate Exchanges


Warren 1031 DST Services

Steps to Success:
  • Act early. Don’t wait until AFTER the sale of your property to arrange your 1031 DST via Warren Financial. Act early. Arrange the exchange BEFORE you sell your property.
  • Bank & credit card statement reconciliation
  • Financial professionals and Industry leaders. Warren Financial coordinates your 1031 DST exchange with major industry players who are executing $Billions of dollars worth of transactions per year. CCRE, Fannie Mae, Freddie Mac, FHA, Newmark, Knight Frank (Europe), Cantor Fitzgerald, ARA, etc.
  • Your CPA is involved every step of the way to ensure you get maximum tax benefit from your 1031 DST exchange.
Benefits:
  • Since DSTs are professionally managed, the manger has the responsibility to handle the terrible T’s: Tenants, Toilets, Trash, Turmoil, and Termites.
  • Meanwhile since the investor not longer has to deal with the Terrible T’s the investor now gets to enjoy the Terrific T’s: Travel, Time, and Tennis.
  • Enjoy a stepped-up cost basis at the owner’s death
  • DST ownership is easily split into beneficial owner’s shares at death whereas directly owned property may be difficult if some beneficiaries don’t participate in upkeep, some what to hold, some want to sell.

Warren Opportunity Zones

Quick Recap: What’s an Opportunity Zone?

Answer: An Opportunity Zone is a tax shelter created by Congress. In order to get investors to invest in poor areas of the USA, Congress via the IRS is offering investors a tax deal. Investors can sell assets that have greatly appreciated, yet defer, reduce and completely bypass taxation.

The numbers (how does this work?):

  1. Assume you have a multimillion dollar investment in wine, stocks, cars, etc. which has about $1m in capital gains profits built up over many years. So you don’t really like the idea of selling because you would have to pay cap gains taxes on your $1m in profits.
  2. You can sell your investment and defer cap gains tax on your $1m in profits until year 2027. If you take action in 2019 you can reduce the cap gains tax down to only cap gains tax on $850k of profits, payable in 2027. If you take action after 2019 you still reduce the cap gains tax down to only cap gains tax on $900k of profits, payable in 2027.
  3. Because you are investing in an Opportunity Zone, the gains you make on your investment will be tax free.
  4. You can leave your money in this investment, tax free, until 2047 at the latest

Warren Opportunity Zones

The Development Projects:
      1. We like to feel sure that you will make profits on your OZ investment, so we are working with a major developer (Silverstein which built the Freedom Tower in NYC) and with Cantor Fitzgerald on their projects
      2. We have 3 projects available now, Hollywood, Jersey City, and Las Vegas. More major projects coming online in 2020.
      3. Minimum investment is $100k of cap gains and you have to be an accredited investor (not QP).
      4. There has been over $250 billion in OZ investments so far
      5. The projects we are tracking from Canter Fitzgerald have a target return of about 15% IRR.
      6. Cantor expects your OZ investment to deliver 2.7x your investment amount in 10 years
      7. OZ investments are development projects, so there is no planned income distributions for the first 3-4 years, but beginning in year 6, after development is completed and the property is used/leased out, there will be income distributions. K-1s are not necessary because this is a REIT structure.

      Warren 1031 DST and Opportunity Zone Services

      Steps to Success
      • Act early. Don’t wait until AFTER the sale of your property to arrange your 1031 DST
      • Opportunity Zone. Don’t wait until after the sale of your wine, cars, stock, etc to begin arranging your Opportunity Zone investment. Take action in 2019 to save an additional 5% (by IRS rules)
      • Warren Financial coordinates your 1031 DST exchange, or your Opportunity Zone investments with major industry players.
      • Talk to us about costs. Obviously, each player at the table will get paid. Warren Financial acts as a consultant in your 1031 DST purchase and the cost is separate and distinct from your normal advisory fees (no advisor fee on 1031 DST). Warren Financial does not act as consultant, but rather simply charges based on your assets under management for Opportunity Zone investments.
      • Your CPA is involved every step of the way to ensure you get maximum tax benefit from your Opportunity Zone, or 1031 DST exchange.

      Warren Opportunity Zones

      Opportunity Zone Developments
      Jersey City mixed use retail/living

      Jersey City mixed use retail/living

      Hollywood Multi Family Units

      Hollywood Multi-Family Units

      Las Vegas Multi Family Units

      Las Vegas Multi-Family Units