Exchange into affordable housing through a structured real estate approach that supports the development of new communities.
To identify replacement property
To complete a qualifying exchange
How the strategy works
Plan your exchange
Engage a qualified intermediary before closing and review your exchange timing.
Position your capital
Participate in a structured real estate arrangement within an affordable housing development.
Support new housing
Exchange capital participates alongside development financing and sponsor equity.
A closer look
Program terms at a glance
| Term | Description |
|---|---|
| Landlord / Sponsor | CRP Affordable Housing and Community Development (“CRP Affordable”) |
| Exchanger objectives | Utilize a 1031 exchange strategy through participation in the CRP Affordable Program. |
| Exchanger position | Secured by a Master-Lease and Castellan guarantee. 1031 exchangers have cash flow priority ahead of the CRP Affordable equity. |
| Minimum exchange | $1,000,000 |
| Lease payments | Equal to 10% of the exchange. Landlord pays all property expenses. |
| Distributions | Flexible / customizable depending on the specific needs of the exchanger. |
| Term | 2–4 years, depending on the specific transaction. |
| Legal counsel | DLA Piper LLP |
| Auditor | CBIZ Marks Paneth |
Where exchange capital sits
The capital stack shows how the sources of development financing are positioned.
- First position
Mortgage loan
The senior loan provides the primary development financing.
- Second position
1031 exchange capital
Exchange capital sits behind the senior loan and supports the project’s early stages.
- Third position
CRP Affordable equity
The sponsor contributes equity to the development.
Compare exchange approaches
Compare the CRP Affordable strategy with a Delaware Statutory Trust (DST) and direct property ownership.
| Feature | 1031 CRP Affordable | DST exchange | Direct exchange property |
|---|---|---|---|
| Tax deferral | Yes | Yes | Yes |
| Active management | No | No | Yes |
| Returns | Fixed, predictable distributions | Varies: distributions fluctuate | Varies: sensitive to market volatility |
| Liquidity | Medium | Low | Low |
| Risks | Sponsor risk, no control over decision-making | Sponsor risk, no control over decision-making | Property-specific risks, market volatility, active management burden |
Estate planning considerations
A 1031 exchange can play a role in long-term estate planning. Depending on individual circumstances, heirs may benefit from a stepped-up cost basis when property is inherited.
Start before you close.
Review the structure, then discuss your exchange equity, timing and deadlines.