Operating/Joint Venture and Out of State Partners

[Alex Jones]

Hello BP,

A buddy of mine presented me with an opportunity for my company to partner with his on multiple out of state deals. He has a partner, and I have two partners. Before we start down this road, I want to manage expectations as much as possible. Can anyone give advice on how we should structure this agreement? Should we set up a new LLC for the partnership? Should we create a joint venture agreement and keep our LLC's separate? What pitfalls can I avoid? What exit strategies can you recommend?

Also, since we’re contributing equal capital to each deal but him and his partner are the boots on the ground and are expected to do more of the work, he asked how we could make it fair. He suggested that we keep an even 50/50 split of each property but pay some sort of upfront fee to compensate them for the extra work. Any ideas on how we can set this up? 

Thanks for all advice! 

Alex