Yet another 1031 exchange question

[Bear Geiger]

I am currently working in development of raw land. In short, we by a large piece of land, make improvements, split it into smaller tracks and sell them. At one time I was told that even if I hold this property for over 12 months it was still not eligible for a 1031 exchange. Some reasons I heard were that we were not allowed to make improvements or that we couldn’t "build inventory (whatever that means).

Then I realized that house flippers do this all the time. They buy a house, renovate it to add value, hold it for 12 months then sell it. In some cases they even split large houses into smaller units.

I would like to know if anyone has ever done a 1031 on improved land.