Your 45-Day Clock Is Already Running

Healthcare 1031 replacement property you own outright. No DST load, no sponsor, your name on the deed.

The day your sale closes, the IRS gives you 45 days to identify replacement property in writing and 180 days to close. Miss either date and the tax you were deferring comes due. Most exchangers spend the first two weeks just figuring out what is available. You don’t have to.

We focus on single-tenant healthcare properties for 1031 exchange buyers: medical offices, urgent care, dialysis, dental, pharmacies and specialty care, leased to essential tenants on long-term net leases. You buy 100% of the building in fee simple, the tenant covers taxes, insurance and most maintenance, and you control what happens next.

Start with your dates. Enter your closing date to see exactly how much time you have, then see the healthcare properties on the market in your price range today.

Identify Smart: A Primary, a Backup and a Fallback

Your identification has to be in writing, signed, and delivered to your qualified intermediary by midnight of day 45, using one of three rules. Most exchangers use the first.

The three-property rule is built for a primary, a backup and a fallback. Your primary is the property you want most. Your backup is a comparable property in case inspections, financing or the seller fall through. Your fallback is the one that will close no matter what, and for some exchangers, that is the right place for a DST: as insurance, not as the plan.

To defer all of your gain, buy property that costs at least as much as what you sold, net of selling costs, reinvest all of your net proceeds, and replace any mortgage you paid off with new debt or additional cash. Cash you keep, or debt you don’t replace, is called boot, and boot is taxable.

Timing is where most exchanges go wrong. A healthcare property can take weeks to inspect, finance and close, and the good ones draw letters of intent quickly. Start reviewing properties before your sale closes if you can, have financing lined up, and identify with enough room to switch if your first choice falls through.

1. Before closingSet your price range, line up financing and start reviewing properties.
2. Days 1 to 20Tour, review leases and tenant credit, and submit letters of intent.
3. Days 20 to 45Get your primary under contract, then identify your primary, backup and fallback in writing.
4. Days 45 to 180Finish due diligence and financing, and close on your replacement property.

Sources: Internal Revenue Code Section 1031 and Treasury Regulation 1.1031(k)-1. This is general information, not tax or legal advice. Confirm your deadlines and identification with your qualified intermediary and CPA.

DSTs Have Their Place. For Most Healthcare Exchangers, It Isn’t First.

Search for 1031 exchange online and most of what you find is selling Delaware Statutory Trusts, or DSTs. A DST lets you buy a fractional interest in a large property run by a sponsor, and for the right investor it solves real problems. But it comes with costs and limits that rarely make the headline.

Start with the load. An analysis of 90 DST offerings filed with the SEC in 2026 found a median selling commission of 7.00% of the offering, ranging up to 10.27%, and that is before payments to the sponsor and its affiliates, which in one fully disclosed offering added another 12.13%. On a $2 million exchange, a 7% commission alone is $140,000 of your equity that never reaches the real estate. In a typical net lease purchase, the seller pays the brokerage commission.

Then there is control. To qualify for a 1031 exchange, a DST has to follow IRS Revenue Ruling 2004-86, so the trustee cannot raise new capital, refinance, renegotiate or sign new leases, reinvest sale proceeds or make more than minor changes to the property. The sponsor decides when to sell, and when it does, you need another exchange on its timeline, not yours.

The risk also sits with the sponsor. In February 2026, Inspired Healthcare Capital, a senior housing sponsor that sold DST interests to about 2,300 investors, filed for Chapter 11, and its restructuring officer stated that only 8 of its 31 communities were operating without direct cash support from the sponsor. A DST investor in that position has no vote and no exit.

With a direct healthcare purchase, your name is on the deed. You choose the tenant, the location and the lease term. You can refinance, sell or exchange when it suits you, and you can work with your CPA on a cost segregation study and 100% bonus depreciation on the building you own.

When a DST does make sense. We will tell you honestly when a DST fits better than a building. That usually means one of these:

• A smaller exchange. Often under $500,000 to $1 million, where a whole building doesn’t fit. The median DST minimum is now $100,000.
• Days, not weeks, left to identify. A DST can be identified and closed quickly when time has nearly run out.
• No landlord role at all. For an investor who wants no decisions to make, even on a net lease.
• The fallback on your list. A DST as the third property you identify, insurance if your first two fall through.

Sources: CrowdfundedWealth analyses of SEC Form D filings for DST offerings (2026); IRS Revenue Ruling 2004-86; InvestmentNews and bankruptcy court filings on Inspired Healthcare Capital (2026). Healthcare 1031 does not offer or sell securities. This is general information, not investment, tax or legal advice.

A triple net lease (NNN) requires the tenant to pay a base rent, plus most of the property expenses, including taxes, insurance, utilities, and capital improvements. This NNN structure helps the property owner avoid many unforeseen property maintenance expenses and, in turn, helps provide consistency in revenue.

Net and gross leases refer to whether the base rent includes operating costs.

The type of lease established between a tenant and the property owner determines whether the tenant or owner is responsible for the property management expenses. With a net lease, the tenant (not the owner) is responsible for paying the majority of operating expenses. Property operating expenses may include:

– Building taxes

– Insurance

– Utilities

– Maintenance expenses

– Capital improvements

– Tenant improvements

With a gross lease, the tenant pays a lump sum, which typically includes additional expenses in the rent.

Net lease healthcare real estate properties are simple to understand, provide long-term predictable rental income, and are abundantly available across the country. Net Lease properties are typically stand-alone hard-assets with a single tenant. Very often healthcare businesses rent rather than build or buy their place of business, allowing them to focus on running their business rather than managing real estate.

Why do healthcare companies lease real estate vs own and manage it themselves?

For businesses, leasing commercial real estate has significant financial benefits:

• Leasing allows a business to focus on what it knows best , operating its business. Commercial real estate is a capital-intensive hard asset. Most businesses would rather focus on improving their unique goods and services rather than repair and maintenance.
• Leasing is less capital-intensive than purchasing. A business which has constraints on its capital may be able to grow its core business activity more rapidly if it leases property rather than purchasing the property outright.
• Property values fluctuate. Leasing shifts that downside risk to the lessor/owner, but if the property market has shown steady growth over time, a business that depends on leased property is sacrificing the potential for gains based on the appreciation in the property.
• Leasing may provide more flexibility. An evolving and growing business that expects to relocate to a new facility in the relatively short term is not obliged to renew a lease at the end of its term.
• Leasing may be the only practical option. For example, a business that wishes to locate in a large office building within tight locational parameters may find leasing better suited to its real estate budget.
• Potential tax advantages. Depreciation of owned capital assets has different tax and financial reporting treatment from ordinary business expenses. Unlike depreciation, lease payments are considered expenses, which can be fully set off against revenue on a current basis when calculating taxable profit at the end of the relevant tax accounting period.

Choose the Healthcare Property That Fits Your Exchange

Every healthcare property type answers the same 1031 question differently: how much equity it absorbs, how long the lease runs, and who stands behind the rent. Here is how each one lines up for an exchange today, with live pricing from the properties on the market.

1031 Exchange Questions We Hear Every Week

Does a healthcare property qualify for my 1031 exchange? Yes. Any real property held for investment or business use is like-kind to other real property, so a net-leased medical office, clinic or pharmacy can replace an apartment building, land or a retail center.

What if my first choice falls through after day 45? You can only buy from the properties you identified, which is why we recommend identifying a primary, a backup and a fallback, and why it pays to start before your sale closes.

Do I need a qualified intermediary? Yes. Your sale proceeds have to go to a qualified intermediary, not to you, and the intermediary holds them until you buy your replacement property. If you have not chosen one yet, choose one before your sale closes.

Can I use debt on my replacement property? Yes. Most exchangers use new financing to replace the debt they paid off, and our sister company, Healthcare Real Estate Fund, arranges acquisition financing for healthcare properties.