What Can You Buy With a 1031 Exchange in San Antonio?

Quick answer: Almost any real property held for investment or business use in the United States. A single-family rental can be exchanged into a retail strip center, a warehouse, an apartment building, raw land, or a medical office building. "Like-kind" does not mean similar — for real estate it is close to unlimited. The real constraint is not what qualifies. It is whether the property you land on is one you actually want to own.

What "like-kind" actually means

Like-kind is the most misunderstood phrase in the entire process. It does not mean you have to trade a duplex for another duplex.

For real property, the IRS treats nearly all investment real estate as like-kind to nearly all other investment real estate. A rental house in Alamo Heights and a distribution warehouse off I-35 are like-kind to each other. So are twelve acres of raw land in Kendall County and a leased dental office in Stone Oak.

What matters is how the property is held, not what type it is. Both the property you sell and the property you buy have to be held for productive use in a trade or business, or for investment.

"Tax deferral is valuable, but tax deferral by itself isn't an investment thesis."

Can you exchange a rental house into commercial property?

Yes, and it is one of the most useful moves available to a small investor.

This is how someone with three tired rental houses ends up owning a single NNN-leased retail building with one tenant, one lease, and no Saturday phone calls about a water heater. The exchange is what makes that trade possible without paying tax on the way through.

It works in the other direction too. Commercial into residential rental, land into buildings, buildings into land — all like-kind.

What San Antonio actually looks like right now, by type

This is where the answer stops being a tax question and starts being an investment one.

Retail is the tight one. Vacancy sat at 4.2% in Q1 2026, and 287 retail properties traded over the preceding twelve months at an average of $211 per square foot and a 7.2% cap rate. Asking rents averaged $19.45 NNN, though that spans a wide range — the CBD asks $33.47 while the Far West submarket asks $14.98. Low vacancy means stable income and it also means you are competing for anything good.

Industrial tells the opposite story. Vacancy was 11.3% overall in Q1 2026, and 12.2% specifically in warehouse and distribution. Average asking rent was $9.43 NNN. There is 3.45 million square feet under construction with about half of it pre-leased, which means more vacancy is likely as those buildings deliver. For a buyer, softness is leverage. For an owner counting on a quick lease-up, it is risk.

Land in Kendall County and the Hill Country behaves differently from either — inventory skews toward ranch and unrestricted parcels, and holding periods are longer. It qualifies for an exchange, and it produces no income while you hold it. That is a real consideration when your exchange has replaced an income-producing asset.

Multifamily and medical office both work, and both attract buyers who are not on a 180-day clock. Know that going in.

"I tell investors to think about the replacement property before they think about the replacement address. The first question isn't 'What property should I buy?' It's 'What problem are we trying to solve with this equity?'"

What does not qualify

The exclusions are narrower than the inclusions, but they matter.

Your primary residence. As JJ puts it: "It cannot be your primary residence — that's another common misconception. It must be an investment property."

Property held primarily for resale. Flips and dealer inventory are excluded. The property has to be held for investment, not for sale.

Personal property. Since the 2017 tax law, only real property qualifies. Equipment, vehicles, and artwork no longer do.

Foreign real estate. US property is not like-kind to property outside the US.

REIT shares and partnership interests. These are securities, not real property. Delaware Statutory Trusts are a separate category that can qualify — that is a conversation for a licensed securities professional and your CPA, not for a real estate agent.

The part that actually decides the outcome

Every property type above qualifies. That is the easy part, and it is where most articles stop.

The harder question is what you want the equity to do. More income or less management. Appreciation or stability. One asset or three. A tenant with ten years left on a lease, or a building you can reposition.

Answer that before the clock starts and the 45-day list writes itself. Answer it during the clock and you are choosing under pressure among whatever happens to be available.

"The goal of a 1031 exchange isn't simply to defer the tax. It's to make sure the equity you're carrying forward is working harder for you in the next asset."

Frequently asked questions

Can I exchange a rental property for a multifamily property?
Yes. Multifamily is like-kind to any other investment real estate, including single-family rentals, retail, industrial, and land.

Can I sell a rental and buy commercial property with a 1031?
Yes. Residential rental to commercial is one of the most common exchanges, and often the reason investors do one.

Can I exchange into property in another state?
Yes. Section 1031 is federal, and any US investment real estate is like-kind to any other. You can exchange San Antonio property into Colorado or Tennessee.

Can I buy raw land with a 1031 exchange?
Yes, if it is held for investment. Remember it produces no income while you hold it, which changes your cash flow if you are exchanging out of a leased asset.

Can I exchange into a property I will eventually live in?
This gets complicated fast and depends on intent at acquisition and how long you hold it as an investment. Talk to your CPA before assuming anything.

Can I split one sale across several properties?
Yes. The three-property rule lets you identify up to three at any value. The 200% rule lets you identify more, as long as their combined value stays under twice what you sold.

Does a property have to be the same value as what I sold?
To defer the full tax, you generally need to buy equal or greater value and replace your debt. Buy less and the difference is taxable boot. Run the numbers with your CPA before you commit.

Part of our guide to commercial real estate and 1031 exchanges in San Antonio.

Schedule a 1031 strategy call with JJ: https://calendly.com/treygroupcommercial/15min

JJ Gorena helps investors across San Antonio, Boerne, New Braunfels, and the Texas Hill Country structure 1031 exchanges the right way.

Nothing in this article is tax or legal advice. Every exchange is different, so talk with your CPA and a qualified intermediary before you make a move.

JJ Gorena II
Trey Group Commercial | eXp Realty
TREC License #0522975
(210) 367-6024
commercial@thetreygroup.com