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Unlocking Hidden Value: How 1031 Exchanges & Mineral Rights Drive Economic Development - Episode 102
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In this fascinating episode recorded live from Nashville's Commercial Mastermind Summit, host Keith Andrews sits down with Tommy Brackey (Mineral Rights Specialist, eXp Commercial in Dallas, Texas) to explore an often-overlooked economic development tool: 1031 exchanges involving mineral rights.
Discover how a tax strategy that began in the 1920s to help farmers swap properties without crushing tax burdens has evolved into a sophisticated economic development mechanism. Tommy breaks down the history of Section 1031 exchanges, from the Revenue Act of 1921 through today's modern applications, and explains how they stimulate local economies by encouraging property transactions that might otherwise be stymied by capital gains concerns.
Key Topics Covered:
- The surprising history of 1031 exchanges and their economic development origins
- How mineral rights qualify as "deeded real estate" for exchange purposes
- Solving the "boot money" problem in commercial real estate transactions
- Why mineral rights can be valued "down to the penny" unlike traditional real estate
- How municipalities can leverage mineral rights for pension funds and development projects
- The role of major energy players (Exxon, Chevron) in creating monthly royalty income streams
- Creative uses of 1031 exchanges as "parking places" for commercial investors
Perfect for:
Economic development professionals seeking innovative financing tools, commercial real estate investors looking to optimize tax strategies, and municipal leaders interested in alternative revenue streams for community projects.
Quote of the Episode:
"Since mineral rights are deeded real estate, they are therefore 1031 exchange compatible. I can be down to the penny in the mineral rights asset class - you can't do that in traditional real estate."
Connect with Tommy:
Website: BetterCallTommy.com
Specializing in West Texas Permian Basin mineral rights and 1031 exchange solutions
Episode Length: 12 minutes
Recorded: Live from Nashville Commercial Mastermind Summit
Build Forward Now is the podcast for economic development professionals, commercial real estate experts, and community leaders building America's economic future. New episodes every week.
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