Promote Crystallization in Real Estate Joint Ventures: Agreement Structure, Benefits, Mechanics
A live 90-minute premium CLE video webinar with interactive Q&A
This CLE webinar will discuss promote (also known as carried interest) crystallization in real estate joint ventures (JVs). The panel will discuss the benefits of using promote crystallization; the mechanics of promote crystallization, including triggering events, calculating the promote, and how the promote is paid; and negotiating and drafting considerations for promote crystallization provisions.
- Overview of the promote crystallization concept in JVs
- How promote mechanics are built into the distribution waterfall provisions of a JV agreement
- Typical promote structure
- Reasons to include promote crystallization provisions in a JV agreement
- Benefits of promote crystallization
- Promote crystallization mechanics
- Determining the crystallization trigger
- Automatic vs. election
- Calculating the promote
- Paying the crystallized promote
- Tax considerations
- Practical considerations and key takeaways
The panel will address these and other key issues:
- What is promote crystallization and how does it work within the context of a JV's distribution waterfall provisions?
- When should parties consider including promote crystallization provisions in a JV agreement?
- What is the typical promote structure?
- What are the mechanics of a promote crystallization?
Michael J. Fritz
Mr. Fritz practices in the areas of business, corporate, and commercial real estate. He concentrates his practice on... | Read More
Mr. Fritz practices in the areas of business, corporate, and commercial real estate. He concentrates his practice on commercial real estate capital market transactions and general business counseling. Mr. Fritz regularly advises national and multinational clients in the commercial real estate, healthcare, financial services, and manufacturing industries. He provides tailored and practical advice, addressing his client’s specific needs and sensitivities. Mr. Fritz's practice is dedicated to representing developers, sponsors, investors, and other capital market participants. He regularly handles the acquisition, development, and disposition of commercial real estate assets, mortgage, and mezzanine financings preferred equity investments, and the structuring of joint ventures. Mr. Fritz focuses on helping his commercial real estate clients structure joint ventures for both single-asset and programmatic real estate investment strategies.Close
Kathleen M. Mylod
Ms. Mylod is a partner in Dechert’s global finance practice, advising on a range of commercial real estate... | Read More
Ms. Mylod is a partner in Dechert’s global finance practice, advising on a range of commercial real estate finance matters. Her clients include private equity and sovereign wealth funds, investment and commercial banks, and large insurance companies across the United States. Her practice focuses on mortgage and mezzanine debt origination; intercreditor, co-lender, and participation arrangements; equity investment and joint venture formation; preferred equity financing; real property acquisition, disposition, and asset management; secondary market acquisition and sales (including mortgage and mezzanine loans); and loan modifications, restructurings, workouts, and enforcement actions. She advises clients investing in various commercial real estate asset classes, whether stabilized or transitional, including hospitality, retail, multifamily, office, and condominium.Close
Alex Rosenthal, Esq.
Mr. Rosenthal has extensive experience in real estate acquisitions and dispositions, joint venture formations,... | Read More
Mr. Rosenthal has extensive experience in real estate acquisitions and dispositions, joint venture formations, commercial leasing, ground leasing and financing transactions both across the country and internationally. He has successfully represented and advised numerous investors, developers, lenders, owners and tenants on complex matters related to all types of real estate, including office, retail, residential, industrial and hospitality.Close
Early Discount (through 10/06/23)
Cannot Attend October 31?
Early Discount (through 10/06/23)
You may pre-order a recording to listen at your convenience. Recordings are available 48 hours after the webinar. Strafford will process CLE credit for one person on each recording. All formats include course handouts.