They will often want a new building constructed and building today with labor and materials is very expensive versus retrofitting existing building.When I buy value add vacant buildings the goal is to double the return on investment within a 3 year period.So if I can use the existing building and retrofit to same concept ( example previous burger inc. but now Whataburger wants to come in ) then not as much tenant improvements to convert.So if rent 20 a foot for 5,000 ft that is 100k NOI NNN a year. 7 cap value is about a 1,400,000 stabilized valueSo if I buy it for 400k and have 300k in it more 700k to get new tenant in the value is then around 1,400,000 based on NNN 20 a foot and a 7 cap rate exit value.If you want a premium price then you would need to sell to an end user tenant ( regional or national in nature) that wants to buy the building and put their concept in there.

Hey @Andrew Grant, As accountants on BP we cannot promote ourselves directly. 

I have seen before 1031 buyers lock in 3 choices but not get some material while under LOI to see if property is viable for cash flow returns and for financing they would like.

But I’m thinking in order to use passive losses from other entities (multi family, SFR’s, etc) I would also have to show material participation in those activities in addition to the REPS, is that accurate?  

The ADU is being promoted heavily these days because it helped government on housing (while they're the one that's causing housing shortage issue at beginning) and at the tail end, they would raise the tax for ADU.So.. if you build ADU, is the house gonna sell more or not ?

., depreciation offsets current cash flow and defers income recognition until disposition) and so are the retirement accounts (tax paid in retirement when distributed) so the tax burden on the money you are borrowing is likely not to materialize for many years.The delta between the 9.5% interest rate and 8.3% average return on the existing retirement account would result in more funds in the account if you take out the loan.

Hey @Ruben Garcia, Given we are accountants, we cannot promote our services on BP as its against the rules.

As accountants on BP we cannot promote ourselves directly.

Replacing cabinet involves much more material and labor cost.

The potential tax savings, ideally four times the cost, rarely materialize at this scale (why?