- 41 -
entitled under paragraph 5(d)(1) of the escrow agreement to give
written notice to Interstate after that 45-day period that it did
not identify all or any of the replacement property and Inter-
state would not have been obligated to pay OIP within three
business days after having received such notice the "Agreed
Amount" as defined in paragraph 5(e)(1) of that agreement.
Instead, OIP would have been required to wait until the expira-
tion of the 180-day period after July 26, 1990, in order to have
been entitled to receive no later than five days thereafter any
moneys remaining in the escrow fund to which it was entitled
under paragraph 5(d)(2) of the escrow agreement.12
Based on our examination of the entire record in this case,
we find that petitioners have failed to establish that they are
entitled to nonrecognition treatment under section 1031 with
respect to the aggregate gains at issue that were realized on the
disposition by OIP of lots 11 and 12 and OIP's 25-percent inter-
ests in lots 14 and 15. Accordingly, we sustain respondent's
determination with respect to those gains.
Claimed Section 1033 Real Estate Transaction
The sole dispute between the parties is whether the alleged
purchase by OIP from IRF of the 34.3-acre parcel of Vero Beach
12If, as we have found, OIP did not comply with par. 5(a) of
the escrow agreement and did not identify in writing all or any
of the replacement property within 45 days after July 26, 1990,
it would have been required to give written notice to Interstate
after that 45-day period. However, no such written notice is in
the record.
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