An investor selling one building in Detroit can end up identifying replacements in three different Michigan metros before the 45-day clock runs out, and each of those metros moves at its own pace. Twenty years of running these searches has shown us that the identification step lives or dies on how early the shortlist gets built, not on how the rule itself reads.
What Written Identification Actually Requires
The identification notice has to describe each candidate property unambiguously, which in practice means a street address or a legal description, delivered in writing to the qualified intermediary before midnight on the 45th day after the relinquished property closes. A verbal mention to a broker or an email that says the investor is considering a building without naming it clearly does not satisfy the requirement, and we treat the written notice itself as the deliverable, not a side conversation.
We draft that notice well before the deadline and route it through the QI's preferred format, since some intermediaries want a signed letter while others accept a structured email, and getting that format wrong at the last minute is an unnecessary risk to take on day 45.
Building a Shortlist Across Different Michigan Submarkets
A seller of a Detroit industrial building might reasonably compare a replacement in the same corridor against an option in Grand Rapids' industrial belt or a smaller building near Lansing, and each of those searches runs on a different timeline. Grand Rapids and Ann Arbor inventory tends to move faster and attract more competing offers than comparable product near Lansing or in the smaller cities outside the main metro areas, so we weight the search toward whichever markets are actually producing live, negotiable listings rather than treating all of Michigan as one uniform pool.
Separating Attractive Properties From Closable Properties
A property that looks good on paper isn't automatically a good identification candidate if the seller isn't genuinely ready to close, if financing questions are unresolved, or if title issues haven't been checked. Before a building goes on the list, we work through:
- whether the seller's timeline realistically matches the exchanger's deadline
- whether financing has been pre-checked against the property type and location
- whether title and environmental questions have been raised early
- whether the property description is specific enough to satisfy written identification
Honest Scale in Smaller Michigan Markets
A search focused on a smaller city or a resort-market town like Traverse City will simply produce fewer live candidates than a Detroit metro or Grand Rapids search, and we say so directly rather than padding a shortlist with properties that aren't realistic replacements. An exchanger working with a thinner market needs to start the search earlier and stay more flexible on property type than one working in a deeper metro.
That flexibility sometimes means widening the search from a single asset class to two or three, since a thin market for medical office might still have workable retail or small industrial inventory that meets the same value and income targets.
Getting the List in Front of the Right People Before Day 45
The shortlist, the candidate notes, and the draft identification language all need to reach the qualified intermediary and the investor's tax advisor with enough runway to raise questions before the deadline, not on day 44. We keep a dated tracker running from the start of the search through the written notice itself so nothing depends on memory in the final week.
Common 1031 Exchange Questions
How specific does a written identification notice need to be?
It needs enough detail to leave no doubt about which property is being identified, which in practice means a street address or a legal description. A vague description like a building in Grand Rapids under a certain price would not satisfy the requirement.
Can I identify properties in more than one Michigan city on the same list?
Yes, there's no rule limiting identification to a single market, and comparing a Grand Rapids option against a Lansing option on the same list is common when an investor wants flexibility. The rule that limits you is whichever identification rule (three-property, 200 percent, or 95 percent) applies to your exchange, not geography.
What happens if I can't find a good replacement property in time?
If no written identification is delivered by day 45, the exchange fails and the transaction is treated as a taxable sale, which is why we push to start the search as early as possible, especially in thinner Michigan submarkets. There's no extension available for a missed identification deadline.
Why do you sometimes recommend against a property that looks like a good deal?
A property can look attractive on price or location and still be a poor identification candidate if the seller isn't ready to close, financing hasn't been checked, or title issues haven't surfaced yet. We'd rather flag those risks before identification than have an exchange stall on a property that was never truly closable.
Do smaller Michigan markets like Traverse City have enough inventory for a real 1031 search?
There's inventory, but meaningfully less than in Detroit metro or Grand Rapids, so we set expectations early and encourage more flexibility on property type or a wider identification list when a search is centered on a smaller market.
What format does a written identification notice usually take?
It varies by qualified intermediary; some want a signed letter on the exchange agreement's letterhead, while others accept a structured email that clearly names each property. We confirm the QI's preferred format early so the notice isn't delayed by a formatting question in the final days before the deadline.
