Creative financing structure/tailoring

[Jeffrey Alan Slachetka]

Good morning, everyone,

I have an opportunity that seems ripe for a creative deal structure. I’ll provide an overview of the situation and my thoughts/attempts on how to structure the deal.

Owner: He is in his 70s, payed off asset, appreciates the return profile of his property but is no longer interested in the management and hassle aspects.

Details: Before I even asked, he mentioned that he isn’t sure where he stands in terms of depreciation and is somewhat concerned about the tax implications of selling.

My initial approach to discussing creative financing:

Me: "Have you heard of or would you consider seller financing? This could help with sales and capital gains tax."

Seller's response: He said, "Yes, I have heard of a land contract, but I’m kind of hesitant because I know some locals who land contracted their assets and ended up with a distressed property after a few years. However, I might consider seller financing if there is a substantial down payment."