Can Minority Partner be Forced into 1031 Exchange?

[David Fritch]

I am the manager of an llc that owns 18% of a larger llc who's only holding is a strip mall. Three other llc's own the rest of the big llc. They all want to 1031 exchange our equity in into a medical office building. My llc does not. I know that there are many ways to resolve the issue allowing us to cash out our equity and them to move on. However they are determined to hold the medical building with no financing and to force us to do the exchange. Is that legal? Can we be forced to sell the property, exchange into another just because they're the majority? 

[Jessica Zolotorofe]

I see, ok. So then the whole company would have to do the 1031. As far as your interest in that company, it 100% depends on what your operating agreement says. There are often tag along/drag along rights that allow them to do that, or rights of a majority in interest, or something like that. HOWEVER, there are also often rights of the minority holders for "capital events", such as sale of the property, so in short, you have to take a look at your operating agreement to find the answer.