Buying Advice

Maximize Your 1031 Exchange: Consider Potential Investment Opportunity at Kukilakila

Are you looking to maximize your 1031 Exchange opportunities? Consider the unique investment potential of the Kukilakila Lakefront Development in Kailua, Oahu. This waterfront community, nestled along the peaceful shores of Enchanted Lake, offers a compelling opportunity for real estate investors seeking tax deferral and long-term wealth growth through a 1031 exchange.

oahu house for sale

What Makes 599 Keolu Dr. #B in Kukilakila Unique?

  • Positive Cash Flow: The property at 599 Keolu Dr. #B in Kukilakila is currently generating $8,670 per month from four tenants on 12-month leases, offering steady income with a Gross Rent Multiplier (GRM) of 12.7. These numbers, although always subject to change and market conditions, speak for themselves when it comes to monthly and annual cash flow. For more photos and details, please go to MLS 202423607.
  • Value-Added Modifications: The townhome has been thoughtfully renovated to enhance rental potential, transforming its layout to include four bedrooms and four bathrooms, each with smart security locks. While the renovations are unpermitted and nonconforming at this time, they were performed with high-quality materials and workmanship, making it an attractive “as-is” offering for the right buyer.
  • Hurricane-Protected Investment: The Kukilakila HOA covers 100% hurricane insurance, safeguarding your investment from natural disasters and keeping maintenance fees low—an important consideration for any real estate investor.

bedroom in oahu home for sale

Why Leverage a 1031 Exchange?

A 1031 exchange allows you to defer capital gains taxes by reinvesting proceeds from a property sale into a like-kind property. This means you can reinvest the full sale amount into another investment without reducing your capital by paying taxes upfront. Some Kukilakila properties have demonstrated capital appreciation of over 50% in the past six years, offering an enticing opportunity to leverage wealth under this strategy.

By choosing a property like 599 Keolu Dr. #B in Kukilakila for your 1031 Exchange, you provide yourself the opportunity to potentially achieve both positive cash flow and future capital appreciation in one of Oahu’s most sought-after areas Kailua. Investors using 1031 exchanges typically look for these qualities in their replacement properties, ensuring strong long-term returns and tax advantages. Remember, timing is critical—be sure to meet the IRS’s 45-day identification and 180-day closing requirements​

Today may be the right time to explore this investment in Kukilakila. Whether you’re expanding your portfolio or looking for a like-kind exchange to grow your wealth, this property might be the right one for you.  For more details or a personalized consultation on how this property fits into your investment strategy, don’t hesitate to reach out!

Investing Disclaimer: While Kukilakila presents the possibility of positive rental income potential and associated capital appreciation, it’s important to remember that real estate investments are inherently subject to market fluctuations. Rental income can vary based on tenant demand, local economic conditions, property management, and government regulations.  Similarly, capital appreciation is influenced by broader market trends. No investment is ever guaranteed, and real estate is no exception. As with any financial endeavor, there are risks, and returns are not assured. Investors should always consider these uncertainties when planning their investment strategy to make informed decisions that align with their risk tolerance.

townhomes on oahu

About the Author

Jon Mann

Jon Mann is a REALTOR Broker RB-19922, Broker-In-Charge with Hawai'i Life. With a passion for Hawai‘i real estate that spans over two decades, I bring a wealth of expertise and a track record of success to my position as Broker-in-Charge of Hawaii Life's East O‘ahu office. As a seasoned real estate professional since 2003, I have dedicated my career to helping individuals achieve their Hawai‘i real estate goals and aspirations. You can email me at jon.mann@hawaiilife.com or via phone at (808) 728-1230.

Comments (2) Show CommentsHide Comments (Remember)

Cool. Add your comment...

Your email address will not be published. Required fields are marked *

Leave your opinion here. Please be nice. Your Email address will be kept private, this form is secure and we never spam you.

S.B. Ripman

Today at 10am

Is the title to the property a leasehold or is it fee simple?
Are there 4 separate rental units within the confines of the property, each occupied by its own tenant?
How patient is the seller? (The upcoming sale and 1030 exchange may not occur until spring of 2025).
Thank you.

Jon Mann

Today at 11am

Aloha.

Thanks for your insightful questions.

Here are the answers to your questions and feel free to contact me via phone or email if you have any further questions or want to discuss the property in greater detail:

1) Is the title to the property a leasehold or is it fee simple?
Answer – Fee Simple.

2) Are there 4 separate rental units within the confines of the property, each occupied by its own tenant?
Answer – Yes…..There are 4 separate rental agreements and each rental agreement includes a “Co-Living Agreement” to address the sharing of common areas within in the unit. Each tenant has their own private space (bedroom) and they share some common areas within the unit, such as the Living room, Kitchen, and Lanai.

3) How patient is the seller? (The upcoming sale and 1030 exchange may not occur until spring of 2025).
Answer – It depends……The sellers have some level of flexibility for an offer at the right price. I would encourage you to contact me by phone and we can discuss how might be the best way to proceed with an offer that might be enticing to the sellers and also meet your timing needs……I can be reached at 808-728-1230…..I look forward to hearing from you……Mahalo, Jon.

More Articles from Hawaii Life