Case Studies
$1,000 Per Month in Cash Flow
In addition to their monthly cash-flow, Matt & Kriston have referred other investors to the 37th Parallel community, thus increasing their cash-flow even more.
“Our experience with the 37th Parallel team has been great. With any other real estate transaction when you close on a property you are basically on your own. When we closed with 37th Parallel it was just the beginning, they are very accessible, had answers to our questions and offered advice that would not be found if we had tried to acquire similar properties on our own. They basically take all the guess work out of the process and most importantly offer support after the close to ensure that our cash-flow properties run smoothly. I can’t begin to tell you the peace of mind that gives us let alone the confidence to keep moving forward in our cash-flow property business.”
- Matt & Kriston S. (Lahaina, HI)
Pay No Tax and Double Your Cash Flow
In March of 2006 Tim & Betty R. called Ed Barriskill about selling their rental house in Bay Point California. At that time they had met with their CPA and found out that they would have to pay approx. $85,000 in capital gains on the sale of the property. After analyzing their situation Ed told them that he could sell their property, exchange the profit into one of our commercial properties (Tax Free) and possibly double their income, and grow their equity. The answer was easily a “yes.”
How we helped
To make a long story short, Ed sold their property and was able to 1031 exchange it into the Freedom Center, a 7 unit retail center in College Station, Texas. Tim & Betty became one of three investors in the project and with their $200,000 invested they started making $1,950 per month income (mostly Tax Free). The income they received was more than twice what they were netting from their rental home $833, plus they are now passive investors with no management responsibilities. Their job now is to cash the quarterly cash flow checks.
The Results
If you talk to Tim or Betty they are very happy that they made this decision to get involved in these commercial projects. They not only didn’t have to pay $85,000 in capital gains to the government, but we have grown their $200,000 into approx. $500,000 in just 2 ½ years…plus all the cash flow.
Defer Taxes, Increase Cash Flow and Increase Equity
Jack and Beverly J. were clients who owned a condo in Walnut Creek, CA. They wanted to sell their condo because they didn’t want to be landlords anymore; they were in their 70’s and were tired and worn out from being a property manager.
How we helped
After analyzing the situation we estimated that they would net approx. $250,000 from the sale of their condo, but they would have to pay about $100,000 in capital gains to the government. Hearing this information they literally felt sick inside. We told them that we knew a way not to pay the capital gains tax and improve their monthly cash flow and equity position by exchanging their condo into a commercial property.
The Results
We helped Jack and Beverly 1031 exchange part of their proceeds of $150,000 into the Freedom Center, a 7 unit retail center where they received $1,465 dollars per month cash flow (Mostly tax Free) and increased their equity from $150,000 to $290,000 in 2 ½ years, a handsome profit.
The second property we exchanged part of their funds into, was the Shops on Texas, a brand new 16 unit retail center, which when we purchased it, was 64% full. It has taken 2 years to bring the occupancy to 94 %. To date we have increased the equity from $100,000 into approx. $144,000 in growth equity… not a bad return in 2 years. They are now passive investors with no management responsibilities and are very happy that they didn’t have to pay capital gains to the government.
By exchanging Jack’s and Beverly’s gain on the condo we set them up financially both in cash flow and equity in the future for themselves and for their children in the future.
