Structuring Real Estate JVs: Capital Contributions, Distributions, Allocations, Taxes, Governance, Exit Strategies

Description

Buying or developing real estate through joint ventures has many advantages, particularly as an alternative source of financing or to deal with high prices in desirable, competitive markets. The joint operating agreement and other related documents are very complex and fiercely negotiated.

Real estate and finance counsel need to understand all of the pertinent issues to successfully allocate control and address economic issues when negotiating and structuring a joint venture operating agreement. Tax structure and potential tax pitfalls must be anticipated and addressed at the outset of the deal.

Counsel for all parties must anticipate disputes over capital calls and negotiate potential penalties for a party unable to contribute additional capital and negotiate buy-out terms. Exit rights and strategies must be carefully thought out and clearly addressed in the operating agreement or other documents.

Listen as our panel of real estate and finance attorneys explains the legal issues to consider at the formation of a real estate joint venture to minimize financial and legal risk for owners, sponsors and capital partners. The panel will outline effective ways to determine governance and control of the venture, as well as capital contributions and fees, related party agreements, and exit strategies when structuring the operating agreement.