“The price is the headline. The allocation is the outcome. I have watched sellers celebrate a number in October and lose a quarter of it on the return in April.”

- Daniel P. Raupp, Co-Founder and Managing Partner, Fortitude Investment Group LLC

Key takeaways

• Marinas are being repriced as infrastructure, which is why unsolicited offers are arriving at owners who never listed anything.
• A marina is four assets for tax purposes, not one, and each is taxed differently.
• The Section 1245 bucket, meaning docks, lifts, fuel systems and equipment, is recaptured as ordinary income and does not defer through a 1031 exchange.
• The purchase price allocation in the asset purchase agreement is the single largest tax lever, and it is negotiable. Most sellers negotiate it after the headline number is agreed, when their leverage is gone.
• An equity purchase of a partnership or LLC interest is generally excluded from Section 1031. If the buyer wants the entity, exchange planning has to happen before the letter of intent.
• Goodwill and business value cannot be exchanged, but eligible capital gain on that portion may be invested in a Qualified Opportunity Fund under rules rewritten for investments made after December 31, 2026.
• A 1031 exchange defers capital gain and depreciation recapture. It does not eliminate them.

Why is private equity buying American marinas?

Because marinas behave like infrastructure, and infrastructure capital is hunting for scarce assets with pricing power.

Waterfront is finite. Permitting a new marina is slow, expensive and in many jurisdictions effectively impossible. Meanwhile the boats keep getting bigger while the slips built in the 1970s and 1980s did not. That is a supply and demand story institutional buyers understand immediately.

The revenue profile helps too. A marina is not one lease. It is annual slip contracts, dry stack storage, fuel margin, service and repair, winter storage, and in many cases retail and food. Contracts renew, switching costs for the boat owner are high, and the customer base is generally insulated from the first shock of an economic downturn.

The capital has followed. Blackstone Infrastructure completed its acquisition of Safe Harbor Marinas from Sun Communities for roughly $5.65 billion in April 2025, the largest marina transaction on record. Stonepeak entered the sector with the Southern Marinas portfolio. Centerbridge and Suntex formed a joint venture funded specifically to acquire. Bain Capital deployed into the space through a joint venture with BlueWater Marinas. In August 2026, Safe Harbor agreed to acquire MarineMax in an all cash transaction valued at approximately $1.5 billion.

When that much institutional money validates an asset class in eighteen months, every family office and mid market fund reprices the entire sector. That is why your phone is ringing.

“When the largest asset managers in the world start writing billion dollar checks for boat slips, they are not buying a hobby. They are buying scarcity.”

- Daniel P. Raupp, Co-Founder and Managing Partner, Fortitude Investment Group LLC

What is actually driving the offer on your desk?

Roll up math. Your marina is worth more inside a platform than it is standing alone.

A scaled operator can put one reservation and billing system across a hundred properties, negotiate national fuel and insurance contracts, finance at the platform level instead of the property level, and sell the assembled portfolio at a higher multiple than any single asset would ever command. Smaller sponsors are assembling independent marinas today with the explicit intention of selling the platform to a larger buyer in three to five years.

Two things follow from that, and both of them matter to you.

• You may have more leverage than you think. If your property completes a geographic cluster the buyer needs, you are not a commodity. Price is not the only term worth negotiating.
• Clean documentation converts directly into dollars. The submerged land lease file, the environmental resource permits, the slip agreements, the dredge and seawall history, the Phase I. Buyers price uncertainty. Every open question a buyer has to discover in diligence becomes a price reduction or an escrow holdback.

If you are eighteen months from a decision, the single highest return activity available to you is getting the file in order before anyone asks to see it.

Why does a marina sale create a bigger tax bill than owners expect?

Because a marina is not one asset. It is four, and each one is taxed differently.

Most sellers walk into a marina transaction thinking about capital gains. Then the return comes back and a meaningful share of the proceeds has been taxed as ordinary income. Here is where the money goes.

The Section 1245 bucket is where marina owners get hurt. Marinas are equipment intensive by nature, and owners who ran aggressive cost segregation studies and claimed bonus depreciation in prior years have converted large portions of their basis into ordinary income exposure. After the Tax Cuts and Jobs Act, personal property no longer qualifies for like kind exchange treatment at all. Some components a cost segregation study flags as Section 1245 for depreciation purposes can still qualify as real property under the Section 1031 regulations, which is exactly why this analysis belongs with a CPA who has done it before rather than with the buyer.

The lever that controls all of this is the purchase price allocation in the asset purchase agreement. It is negotiable. Most sellers negotiate it after the headline number is agreed, when their leverage is gone. That sequencing is a mistake and it is an expensive one. If you want a second set of eyes on an allocation before it is locked, call us at 1-844-437-8103.

One more structural issue. If the buyer wants to purchase your entity rather than your assets, an interest in a partnership or an LLC taxed as a partnership is generally excluded from Section 1031. And if your marina is held by a family partnership where some owners want cash and others want to exchange, that divergence needs to be addressed long before the letter of intent is signed. Solving it during escrow is how exchanges fail.

What does the allocation actually change, in dollars?

On the same headline price, moving value between the buckets can change the after tax outcome materially, because one bucket defers and the other is taxed as ordinary income today.

The composite below is assembled from marina and marina adjacent transactions and is illustrative only. Every figure is hypothetical and rounded, and no seller should rely on it in place of their own CPA's modeling.

Case study: a $22 million offer, two allocations, one seller

A family has owned a 300 slip marina on the southeast coast since 1994. It includes a ship store, a service building, dry stack storage, a fuel dock and a long term submerged land lease. A cost segregation study was run in 2016 and was aggressive, as marina studies usually are. An infrastructure backed platform buyer offers $22,000,000, all cash, asset purchase.

The buyer's first draft allocation arrived after the price was agreed. It loaded value into equipment and goodwill, which suited the buyer's own depreciation position perfectly well and suited the seller's not at all.

The headline price is identical in both columns. What changed is which bucket the value sat in, and therefore how much of it was taxed at ordinary rates in the year of sale versus deferred into replacement property. The negotiation was supported by an engineering based allocation study and the seller's own CPA, not by an assertion, because a buyer will not move on allocation without a defensible basis and both parties file consistent forms.

Two things made that negotiation possible, and neither of them was available at the closing table.

• The family engaged their CPA to model the allocation before the letter of intent, so they knew what each percentage point of shift was worth while price was still being discussed.
• The entity was cleaned up in advance. Two of the four family members wanted cash and two wanted to exchange, and that divergence was resolved through the ownership structure months ahead rather than during escrow.

The exchangeable proceeds went into a diversified group of Delaware Statutory Trust interests, which relieved the pressure on the 45 day identification window while the family was simultaneously winding down an operating business and transitioning staff. The Section 1245 recapture and the business value portion were taxed in the year of sale, as they always were going to be. That liability was known, reserved for, and budgeted rather than discovered.

The counterexample is the more common one. A seller signs a letter of intent with the price locked and the allocation left to be worked out later, then discovers in April that a quarter of the proceeds was taxed at ordinary rates. There is no fix for that after the return is filed.

The scenario above is a composite illustration assembled from situations Fortitude has worked on. It does not describe any single client or transaction, the figures are hypothetical and rounded, and it is not a prediction, a projection, a guarantee of results, or a recommendation to buy or sell any security. Individual outcomes depend entirely on facts specific to the taxpayer.

Can a marina owner do a 1031 exchange?

Yes, on the real property portion, if the deal is structured as an asset sale and the exchange is set up before closing.

Real property held for investment or for productive use in a trade or business qualifies. That can include the land, qualifying improvements, boat slips, and long term submerged land leaseholds where sufficient term remains. The mechanics are unforgiving and well known: a qualified intermediary must be engaged before closing, forty five days to identify replacement property, one hundred eighty days to complete. Touch the proceeds and the exchange is over.

For marina owners there is a practical problem underneath the legal one. Most of them are not selling because they want a different property. They are selling because they are finished operating a business that runs seven days a week from May to October. Sourcing, underwriting, financing and closing a replacement property inside forty five days, while simultaneously winding down an operating company and transitioning staff, is a genuinely difficult thing to do well.

What is a Delaware Statutory Trust, and why do marina sellers look at one?

A Delaware Statutory Trust is a passive real estate ownership structure the IRS recognized as qualifying 1031 replacement property in Revenue Ruling 2004-86.

An investor acquires a beneficial interest in a trust that holds institutional real estate. Because that interest is treated as a direct interest in real property for exchange purposes, it satisfies the like kind requirement. The sponsor handles acquisition, financing, management and eventual disposition.

For a marina seller, that structure addresses several problems at the same time.

• Financing is already in place at the trust level, so there is no lender qualification and no personal guarantee.
• Identification and closing can happen quickly, which relieves pressure on the forty five day window.
• Minimum investment sizes generally allow proceeds to be spread across multiple properties, sectors and geographies rather than concentrated in one replacement asset.
• There is no operating business. No staff, no fuel dock, no hurricane season phone calls.
• For owners thinking about estate planning, fractional interests can be simpler to divide among heirs than a single operating property.

That last point is often the real driver. An owner with three children, one of whom wants to run the marina and two of whom do not, is holding an asset that does not divide cleanly. Passive interests do.

What are the tradeoffs of a DST?

Illiquidity, no control, and a tax liability that is deferred rather than removed.

This is the part of the conversation that separates advisors from salespeople, so here it is plainly.

• Illiquidity. There is no established secondary market. Hold periods are typically five to ten years and are controlled by the sponsor, not by you. Do not place money you may need.
• No control. Revenue Ruling 2004-86 imposes real limitations on what a trust may do. You do not vote on leasing, capital expenditure, refinancing or sale.
• Distributions are not guaranteed. They can be reduced or suspended. Any projection is a projection, not a promise, and past performance does not indicate future results.
• Leverage and market risk. Most DSTs carry property level debt. Values can decline and principal can be lost.
• Fees and load. Offering costs are disclosed in the private placement memorandum and they are real. Ask for them in writing and read them.
• Eligibility. DST interests are securities sold through private placements. They are available only to accredited investors.
• The recapture problem does not fully disappear. If the replacement property contains less Section 1245 property than the marina did, a portion of that recapture can be recognized in the year of the exchange even when the exchange is otherwise correctly structured.

And the point that has to be said out loud in every one of these conversations: a 1031 exchange defers capital gain and depreciation recapture. It does not eliminate them. The deferred liability travels into the replacement property and is recognized on a future taxable disposition. Under current law heirs may receive a step up in basis, but current law is subject to change and no plan should be built on the assumption that it will not.

What about the portion of the sale a 1031 exchange cannot touch?

That is where a Qualified Opportunity Fund becomes relevant, and the rules governing those funds were rewritten for investments made after December 31, 2026.

Section 1031 is limited to real property. The goodwill, going concern value and business enterprise portion of a marina sale is excluded by statute. For a well run marina with a strong service department, a full dry stack and a loyal customer base, that excluded portion is not a rounding error. It can be a substantial share of the price, and under a pure exchange strategy it is fully taxable in the year of sale.

A Qualified Opportunity Fund works on different principles entirely.

• It accepts eligible capital gain from almost any asset. Real estate, a privately held business, stock, qualified Section 1231 gain. There is no like kind requirement, which is precisely why it can reach the business value portion that an exchange cannot.
• You invest the gain, not the proceeds. A 1031 exchange generally requires reinvesting all net proceeds and replacing the debt to achieve full deferral. A Qualified Opportunity Fund requires only the gain amount. Your basis stays in your pocket as cash. For an owner who wants liquidity and deferral at the same time, that distinction is significant.
• No qualified intermediary is required. The 180 day investment window applies, and the rules governing when that clock starts for Section 1231 gain and for gain passed through on a K-1 are specific. Confirm the start date with your CPA rather than assuming it.

Used together rather than as alternatives, the two tools cover different parts of the same closing statement. That is the planning insight most marina sellers never hear, and it is worth a conversation. Call 1-844-437-8103.

What changed under the new Opportunity Zone rules?

The program is permanent, the zone map is being redrawn for 2027, and the deferral mechanics are materially different from the version most investors learned.

The One Big Beautiful Bill Act made Opportunity Zones a permanent feature of the code with designations renewed on a ten year cycle. Treasury and the IRS have been building out the framework through 2026. The practical changes that matter to a seller are these.

• A new map. Revenue Procedure 2026-14 set the designation process. The nomination window opened July 1, 2026 and closed September 30, 2026. The new zones run from January 1, 2027 through December 31, 2036. Tract eligibility was tightened, so there will be meaningfully fewer designated zones than under the original program.
• A rolling five year deferral. Under the original program, every deferred gain came due on one fixed date, December 31, 2026. Under the new rules, gain invested on or after January 1, 2027 is deferred for five years measured from that specific investment, so an investment made in March 2027 recognizes the gain in March 2032 absent an earlier triggering event.
• A 10 percent basis step up at five years. Only 90 percent of the deferred gain is recognized at the inclusion date. Qualified Rural Opportunity Funds carry a 30 percent step up, which is three times the standard benefit and is the single largest incentive in the new structure.
• The ten year benefit survives. Hold the fund interest for ten years or more and the election to adjust basis to fair market value still applies to appreciation inside the fund, now measured against a thirty year outside window.
• The guidance is live and unfinished. IRS Notice 2026-40, issued June 18, 2026, supplies transition rules. Proposed regulations expanding fund and business reporting followed on September 11, 2026. Further proposed regulations on the post 2026 transition remain pending. Anyone presenting these rules as fully settled is ahead of the IRS.

Why your closing date matters more than usual this year

This is the part worth reading twice. Capital gain realized directly in the second half of 2026 carries a 180 day investment window that runs into 2027. Gain passed through to you on a K-1 from a partnership or S corporation during 2026 carries a longer runway still. Invest that gain in a Qualified Opportunity Fund on or after January 1, 2027 and it falls under the new regime, with the rolling five year deferral and the basis step up, rather than the legacy December 31, 2026 inclusion date that applied to the original program.

For a marina owner negotiating right now, the closing date and the entity through which the gain flows are not administrative details to be handled by the title company. They determine which body of law applies to a significant portion of your proceeds. A few weeks of difference in a closing calendar can change the answer. Before you agree to a closing date, call Fortitude Investment Group at 1-844-437-8103 and model it both ways.

“For twenty five years the first question was which exchange to use. Right now the better question is which calendar year your gain lands in, because for the next few months that one decision may be worth more than anything else on the term sheet.”

- Daniel P. Raupp, Co-Founder and Managing Partner, Fortitude Investment Group LLC

What are the risks of a Qualified Opportunity Fund?

Development risk, a longer hold than most sellers expect, and a tax bill that still comes due at year five.

• Ordinary income is not eligible gain. A Qualified Opportunity Fund defers eligible capital gain. It does not defer Section 1245 ordinary income recapture. The recapture problem described earlier in this article does not disappear through this door either.
• You owe the deferred tax at five years and you need cash to pay it. The fund itself may not distribute enough to cover the liability. That is a liquidity planning question, and it is the one most often overlooked.
• Most funds are development projects. That means construction risk, cost overrun risk, lease up risk and execution risk that a stabilized income property does not carry. The return profile is different and so is the downside.
• The hold is long. Ten years is the threshold for the primary benefit. That is a decade of illiquidity in a private placement with no secondary market.
• Zone risk is new again. With the map redrawn effective January 1, 2027, a location that worked under the original designations may not be in a designated tract under the new ones.
• Regulatory risk. Key regulations are proposed rather than final, and reporting obligations are expanding. Details may change between now and the time you would exit.
• Eligibility and loss of principal. These are securities offered through private placements to accredited investors. You can lose your entire investment.

“Tax efficiency should serve the plan. It should never drive it. I would rather a client pay a tax they can comfortably afford than lock themselves into a ten year structure that does not fit the life they actually want.”

- Daniel P. Raupp, Co-Founder and Managing Partner, Fortitude Investment Group LLC

What should you do before you sign a letter of intent?

Model the after tax outcome of at least three structures before you negotiate the price.

1. Assemble the tax picture. Depreciation schedules, any cost segregation study, adjusted basis by asset class, suspended passive losses, and the entity structure of record.
2. Have your CPA allocate and model. Split the expected price across real property, personal property and business value, then model the tax under two or three different allocations so you know what each percentage point is worth before it comes up in negotiation.
3. Pressure test the closing date. Given the Opportunity Zone transition, when you close and how the gain flows to you can determine which regime applies. Run the calendar before you agree to one.
4. Decide what you want your life to look like. Income, liquidity, involvement, legacy. This is not a tax question, and it should be answered before any tax strategy is selected.
5. Compare the alternatives side by side. Outright taxable sale. Asset sale with a full 1031 exchange. Partial exchange with cash out for liquidity. Qualified Opportunity Fund treatment for the gain an exchange cannot reach. Installment sale or seller carryback. A 721 UPREIT contribution. Combinations of these. Each produces a different after tax number and a different life.
6. Engage the qualified intermediary before closing. Not at closing. Before. Once you have constructive receipt of proceeds, no advisor can put the exchange back together.
7. If replacement property is part of the plan, start the review during diligence. Not after the wire arrives. Availability changes, and the best planning happens with time on the clock rather than on day thirty eight.

The bottom line

The owners who do best in this window will not be the ones who negotiated the highest headline price. They will be the ones who understood, before signing, exactly how the proceeds would be taxed and exactly what they wanted the money to do afterward.

Consolidation has created a legitimate window for marina owners. Buyers are well capitalized, motivated, and paying for scarcity. That window will not stay open forever.

Fortitude Investment Group works with property owners nationwide on 1031, 1033 and 721 exchange strategies, Delaware Statutory Trust replacement property, and Qualified Opportunity Fund planning for accredited investors. If you are weighing an offer, a conversation before the letter of intent is worth considerably more than a conversation after it.

Frequently asked questions

Can I do a 1031 exchange when I sell my marina?

Yes, on the real property portion, provided the transaction is structured as an asset sale and a qualified intermediary is engaged before closing. Business value, goodwill and personal property such as equipment do not qualify for exchange treatment. Call Fortitude Investment Group at 1-844-437-8103 to review your structure before you commit to one.

Why does a marina sale trigger ordinary income tax?

Docks, lifts, fuel systems and equipment are generally depreciated as Section 1245 property. On sale, that depreciation is recaptured as ordinary income rather than at capital gain rates, and it is not eligible for 1031 exchange deferral or Qualified Opportunity Fund deferral.

What is a Delaware Statutory Trust?

A Delaware Statutory Trust is a passive real estate ownership structure that the IRS recognized as qualifying 1031 replacement property in Revenue Ruling 2004-86. DST interests are securities offered through private placements to accredited investors only, and they are illiquid.

Is the purchase price allocation negotiable?

Yes. The allocation across real property, personal property and business value is negotiated in the asset purchase agreement, and both parties file consistent forms. Because it determines how much of the proceeds can be exchanged and how much is taxed as ordinary income, it should be modeled before the price is agreed rather than after, and supported by a defensible engineering based study.

What if the buyer wants to purchase my entity instead of the assets?

An interest in a partnership or an LLC taxed as a partnership is generally excluded from Section 1031 treatment. If a buyer insists on an equity purchase, exchange planning has to happen well before the letter of intent rather than during escrow.

Can I use a Qualified Opportunity Fund when I sell my marina?

Potentially, for the eligible capital gain portion, including gain attributable to goodwill and business value that a 1031 exchange cannot defer. A Qualified Opportunity Fund accepts eligible capital gain from the sale of almost any asset and requires investment of the gain only rather than the full proceeds, generally within 180 days.

What changed under the Opportunity Zone 2.0 rules?

The program is permanent with designations on a ten year cycle. New zones take effect January 1, 2027 through December 31, 2036. Gain invested on or after January 1, 2027 receives a five year deferral measured from the investment date, a 10 percent basis step up at five years, and 30 percent for Qualified Rural Opportunity Funds. IRS Notice 2026-40 provides transition guidance and further proposed regulations remain pending.

Can I use a 1031 exchange and a Qualified Opportunity Fund in the same sale?

They address different portions of the transaction. A 1031 exchange can defer gain on the qualifying real property. A Qualified Opportunity Fund can accept eligible capital gain the exchange cannot reach, such as gain attributable to goodwill and business value. Coordinating both takes careful structuring with your CPA before closing, not after.

Does a 1031 exchange eliminate my tax?

No. A 1031 exchange defers capital gain and depreciation recapture. It does not eliminate them. The deferred liability carries into the replacement property and is recognized on a future taxable disposition.

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About the author

Daniel P. Raupp (CRD# 4079107) is Co-Founder and Managing Partner of Fortitude Investment Group, LLC in Setauket, New York. Since 2000 he has guided clients through more than $1 billion in securitized real estate offerings, specializing in 1031 exchange planning with Delaware Statutory Trusts, non traded REITs, private placements and limited partnership offerings. He holds Series 7, 24 and 63 registrations and is registered across 48 states and the District of Columbia. Verify his background at FINRA BrokerCheck, CRD# 4079107. Reach the Fortitude team at 1-844-437-8103 or 1031dst.com.

Important disclosures

This material is for informational and educational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any security. It is not tax, legal or investment advice, and it is not a recommendation with respect to any specific transaction, property or strategy. Every situation is different. Consult your own CPA, tax attorney and legal counsel regarding your circumstances before acting.

A Section 1031 exchange defers, but does not eliminate, capital gain and depreciation recapture liability. There is no guarantee that any exchange will qualify for the intended tax treatment. Delaware Statutory Trust interests and Qualified Opportunity Fund interests are securities offered through private placements under Regulation D and are available only to accredited investors as defined under the federal securities laws. These investments involve substantial risk, including illiquidity, absence of a secondary market, lack of investor control, reliance on the sponsor, use of leverage, development and construction risk, tenant and vacancy risk, potential reduction or suspension of distributions, and the possible loss of the entire principal amount invested. There is no guarantee of income, appreciation or return of capital. Past performance does not guarantee or indicate future results. Investors should read the applicable private placement memorandum in full, including the risk factors, before investing.

Opportunity Zone rules described in this article reflect statutory changes enacted in 2025 and administrative guidance issued through 2026, including IRS Notice 2026-40 and Revenue Procedure 2026-14. Certain regulations remain in proposed form and are subject to modification. Qualified Opportunity Fund treatment depends on facts and timing specific to each taxpayer, and eligibility of any particular gain should be confirmed with a qualified tax advisor.

References to third party transactions are drawn from publicly reported information and are provided solely to describe general market conditions. They are not endorsements of, or statements about, any company, sponsor or investment.

Securities offered through Concorde Investment Services, LLC (CIS), member FINRA/SIPC. Advisory services offered through Concorde Asset Management, LLC (CAM), an SEC registered investment adviser. Fortitude Investment Group is independent of CIS and CAM.

This material is for informational purposes only and is not an offer to buy or sell any security or investment product. Past performance does not guarantee future results. All investments involve risk, including possible loss of principal. Consult your tax, legal, and financial advisors before making investment decisions.