James Brennan, a former vice president with Wachovia Exchange Services, has launched ES Group, a Reston, Va.-based intermediary in the 1031 exchange arena. In a 1031 exchange, a seller of commercial real estate avoids paying capital gains taxes on the sale by deploying the sale proceeds into another similar property.
Brennan has managed the mid-Atlantic markets for 1031 intermediaries owned by Washington Mutual and Wachovia Bank. “Working for large institutions and providing a finite number of exchange services was highly limiting to the number of options I was able to offer my clients,” according to Brennan. “Being independent of a bureaucratic organization allows me to provide additional services and add value to my clients in order for them to have the highest possible level of comfort with their transaction.”
ES Group, which is a qualified intermediary, will provide services nationally and allow clients the flexibility of placing their exchange proceeds with banks with which they already have a relationship.
“Using only one bank alienates a majority of your client base that has varying degrees of comfort with different financial institutions. You have to give clients a choice on where they park their money,” Brennan notes.
ES Group will also work with banking institutions and credit unions to provide 1031 exchange services to their clients, so that these financial institutions don’t have to bear the cost of starting such a department internally.