CalculateRealEstateROI

Multifamily · Guide

Multifamily Exit Strategies

Sale, refi, 1031, or recap — value-add deals exit at 5–7 years typically.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Key takeaways

  • 5–7 year hold standard.
  • Sale to bigger operator at premium.
  • Recap returns capital while holding.
  • 1031 into larger deal.
  • Refinance pulls equity tax-free.

Core concepts

Sale

Stabilized + value-add = peak pricing.

Recap

Sell to new equity; sponsor retains role.

Refi

Pull 75% LTV proceeds.

Step-by-step framework

  1. 1Annual exit review.
  2. 2Engage broker 18 months out.
  3. 3Decide based on market + IRR.

Common mistakes to avoid

  • Holding past peak.
  • Missing 1031 window.

Frequently asked questions

Optimal hold?

5–7 years.

Recap vs sale?

Recap when sponsor wants to keep operating.

Refi vs sell?

Refi if cap rates expanding.

Broker fee?

1–3%.

Action checklist

  • ☐Exit review annual.
  • ☐Broker engaged 18mo.
  • ☐1031 planned.
  • ☐IRR computed.

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