Explore royalty portfolios for 1031 replacement property.
If you are selling investment or business real estate in a 1031 exchange, producing oil and gas royalties may be a replacement-property option. Peregrine sources royalty portfolios and works with you and your Qualified Intermediary as you evaluate fit and coordinate the exchange. Royalty income depends on production, commodity prices, ownership terms, and operator payments.
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Some oil and gas royalty interests may qualify as real property for Section 1031 purposes. Whether a specific interest fits depends on the property, how it is held, and the transaction. Discuss eligibility and deadlines with your tax advisor and Qualified Intermediary. Peregrine sources producing royalty portfolios for investors to evaluate as possible replacement property.
Read the full guideBuilt for exchangers who want more than another building.
Real estate investors, their advisors, and qualified intermediaries come to us when the usual replacement property doesn't fit the goal. Here's who we help most.
Real estate investors.
Selling an investment property into a low-cap-rate market? Exchange into royalties for passive, monthly income — no tenants, no management.
Learn moreExchangers on the clock.
In a deferred exchange, identify replacement property in writing within 45 days after transfer. You generally must receive it by the earlier of 180 days or your tax return due date, including extensions. Ask your Qualified Intermediary to confirm the deadlines for your exchange.
Learn moreAdvisors & intermediaries.
Help clients evaluate producing royalties as a possible income-producing replacement property. We support sourcing and title diligence while you keep the relationship.
Learn moreFour steps, one continuous timeline.
You transfer your relinquished property through your own Qualified Intermediary. Peregrine can source royalty interests for you to evaluate as possible replacement property. In a deferred exchange, you generally must identify replacement property within 45 days and receive it by the earlier of 180 days or your tax return due date, including extensions.
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01
Introduction & education. No obligation
We learn your exchange timeline, target equity, and income goals, then walk through how producing royalties fit — and where they don't — as replacement property.
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02
Identification.
Our land team shares candidate interests and property details for your review with your Qualified Intermediary. Replacement property generally must be identified in writing within 45 days after you transfer the relinquished property.
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03
Closing.
If you and your advisors decide to proceed, you sign a purchase and sale agreement and acquire the specific interests through your exchange. We coordinate with your Qualified Intermediary; tax treatment depends on the properties and facts of your transaction.
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04
Title & revenue transition.
We record the mineral deeds in your name and coordinate the revenue transition with operators. Payment timing and amounts depend on production and operator reporting; operators provide tax forms as required.
Why investors exchange into royalties.
Some producing royalty interests may qualify as replacement property in a Section 1031 exchange. Eligibility depends on the property and transaction, so review a specific interest with your Qualified Intermediary and tax advisor.
Royalty income tied to production.
Producing interests can generate royalty income as operators report and pay production. Amounts and timing vary with production, prices, deductions, title, and operator schedules.
No well-operating role.
Royalty interests generally do not make the owner responsible for well operating costs. Confirm the interest type, lease, and deductions before closing.
Many wells, many basins.
Some portfolios include interests across multiple operators, basins, and producing wells. Holdings and diversification vary by portfolio.
Potential depletion deduction.
Some owners may qualify for percentage depletion, subject to federal tax rules and individual circumstances. Ask your tax advisor how the rules apply to you.
Energy specialists, not a real-estate shop.
Where the royalties come from.
From the Permian to the Appalachian, Peregrine has acquired royalty and mineral interests across eight major U.S. basins, with owners in 30 states from Alaska to Florida.
- Permian
- Bakken
- Eagle Ford
- Marcellus
- Utica
- SCOOP/STACK
- Haynesville
- DJ Basin
