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Introduction To TIC’s

Introduction To TIC’s. Alex Kowalski* Alta Exchange Group alex@altaexchangegroup.com 920-540-1072. Joe Wagner The Geneva Organization joe@genevawealth.com 608-825-4551.

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Introduction To TIC’s

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  1. Introduction To TIC’s Alex Kowalski* Alta Exchange Group alex@altaexchangegroup.com 920-540-1072 Joe Wagner The Geneva Organization joe@genevawealth.com 608-825-4551 *Registered Representative of and securities offered through Berthel Fisher and Company Financial Services, Inc. (BFCFS). Member FINRA/SIPC. Alta Exchange Group and The Geneva Organization are independent of BFCFS.

  2. DISCLOSURE This material does not constitute an offer to sell or a solicitation to buy any security. Such offers can be made only by a Private Placement Memorandum to accredited investors. These investments involve a high degree of risk and are not suitable for all investors. Please refer to the Risk Factors section of any specific Private Placement Memorandum.

  3. The ABC’s of TIC’s • Undivided Fractional Interest • Everything Is Pro-Rata • Non-Recourse Debt • Entity Selection Is Critical • No Day to Day Management

  4. The ABC’s of TIC’s • Free From “Partners” After Disposition • Low Leverage: 50%-66% LTV • Guarantee of Close – Sponsor Owns • All 1031 Exchange Requirements Apply • Not Limited to 1031 Exchange Money

  5. Risk Factors • TIC Interests are Illiquid • Use of Significant Leverage May Increase Risk of Loss • Future Tax Code Changes • Costs Associated With 1031 Investments May Offset the Benefits

  6. Definitions • Sponsor – A company who provides institutional properties for co-ownership. • Registered Rep – A securities licensed person who assists investors in finding replacement property. • Tenant-In-Common (TIC) Interest – Fractional ownership interest in a property.

  7. Total Annual Equity Invested *Source: OMNI Brokerage

  8. Key Drivers • Guidance From IRS In 2002 • Revenue Procedure 2002-22 • Highly Appreciated Assets • Baby Boomer’s – Assets To Income • Inability To Find Replacement Property • Desire For Stability/Cash Flow • Little Management Responsibility

  9. Who’s Investing • Must be an Accredited Investor An accredited investor is an individual with a net worth, or joint net worth with their spouse that exceeds $1MM at the time of purchase; or an individual with income exceeding $200,000 in the last two years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same in the current year; or a trust with assets in excess of $5MM, not formed to acquire the securities offered, whose purchase a sophisticated person makes.

  10. Who’s Investing • Farmers – • Large Tax Hit, Looking to Retire • Mr. Fix It – • Capital Gains Tax and Recapture Tax, Wants Income • Business Owners – • Tax Deferral and Income • Developers – • Hard to Match an Exchange

  11. What Are They Buying • Office – Single Tenant and Multi • Retail – Single Tenant and Multi • Multifamily – With Good Demographics • Hospitality/Senior Housing - Increasing • Industrial – In Key Areas • Oil + Gas – Higher Cash Flows/Alpha

  12. Questions?

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