Key Players in a Tenant-in-Common (TIC) Investment Offering

For many investors exploring Tenant-in-Common (TIC) properties as part of a 1031 Exchange, one of the first surprises is just how many professionals are involved in the process. Unlike buying a single-family rental or a small commercial property, TICs are structured in ways that require legal, financial, and securities oversight.

If you’ve ever wondered why these transactions feel more complex, it’s because they are — but each party plays a critical role in protecting investors and keeping the deal compliant. Let’s break down the major players in a typical TIC offering and what they do.

1. Real Estate Exit Broker

The process usually starts with selling your current property — often called the “relinquished property.” A real estate agent, acting as your Exit Broker, helps list and sell that property so you can free up equity for your next investment.

For many investors completing a 1031 Exchange, the goal is to roll those proceeds into a higher-quality, income-generating property, and a TIC can be a good fit. The Exit Broker’s role is critical because without the sale, there’s no capital to reinvest.

2. Escrow Officer or Closing Agent

Every property transfer needs a neutral third party to handle the details. That’s where the escrow officer (or attorney, depending on the state) comes in.

Their responsibilities include:

• Ordering title reports and insurance.

• Preparing closing documents and deeds.

• Handling payoffs for existing loans or liens.

• Collecting funds and ensuring they’re properly disbursed.

In a 1031 Exchange, the escrow officer ensures that sales proceeds are transferred directly to the Qualified Intermediary — not the investor — to avoid triggering taxes.

3. Qualified Intermediary (QI)

The Qualified Intermediary, sometimes called an Accommodator, is the linchpin of a 1031 Exchange. Their main job is to hold your sale proceeds in a way that prevents you from having “constructive receipt” of the funds (which would make them taxable).

The QI also drafts the exchange documents, monitors deadlines, and ensures your transaction stays compliant with IRS rules. Without a QI, you cannot complete a valid 1031 Exchange.

4. TIC Sponsor or Syndicator

A TIC Sponsor is typically a professional real estate firm that acquires large, institutional-grade properties — such as office buildings, industrial assets, or retail centers — and then divides them into fractional ownership shares for investors.

Sponsors don’t just split the property; they also:

• Arrange financing (often non-recourse loans).

• Structure the investment as a securities offering.

• Manage the property and tenants.

For investors, the benefits are clear: steady income from long-term leases, potential appreciation, and tax advantages through depreciation. In short, the Sponsor makes it possible for individual investors to own a slice of a property they could never afford alone.

5. Broker-Dealer and TIC Broker

Because TIC interests are classified as securities, they must be sold by licensed professionals. Here’s how that works:

• Broker-Dealer: Acts as the supervisory entity. They ensure offerings comply with securities laws, oversee marketing, and enforce training and compliance standards for brokers. They’re also subject to SEC and FINRA regulations, which exist to protect investors.

• TIC Broker: Works directly with you, the investor. They review the property’s Private Placement Memorandum (PPM), explain the risks and details, and help determine if the investment is suitable for your goals and financial profile. Once you decide to invest, the broker coordinates your ownership percentage and ensures your equity is properly allocated.

Together, these roles provide the due diligence and compliance oversight needed for investors to confidently participate in TIC offerings.

Why So Many Players?

It may seem overwhelming to involve so many parties in a single transaction. But when you consider the size of the investments, the complexity of tax law, and the fact that TICs are securities offerings, the need for extra safeguards becomes clear. Each party has a defined role that ensures:

• The transaction is legally compliant.

• Investor funds are protected.

• The property is managed professionally.

Who’s Really on Your Team?

When you invest in a TIC, you’re not going it alone — and that’s the point. Each professional involved plays a role in protecting your capital, keeping the deal tax-efficient, and aligning the investment with your long-term goals.

The key for investors is to carefully vet the Sponsor and work with trusted brokers, intermediaries, and advisors who put your interests first. With the right team in place, TICs can be a powerful tool for building a diversified and tax-efficient real estate portfolio.