Operating agreement, Any Experienced CRE Investors In The House?

[Sharon R.]

Hi, This is a bit complicated... Multi Family purchasing, Have you ever prepared an OA for your LLC when adding a member that isn't investing money***? It is common when the deal is bigger than your normal practice and the lender will approve the loan if another party with more experience will join the LLC, some call is "sponsorship", if you have experience with that, please share how did you form it (tax wise**) ? Did you write your own provisions? or did you let an attorney do it for you? if you did use one who is licensed in GA, pls send reference.

In the same matter, Do you normally use an attorney to read the 70 pages sent by the lender? we all now it's barley negotiable but I still think it's safer. Experienced commercial real estate investors, please see if you can contribute to this topic, I really appreciate it. We were all new-er at some point :) 

*** The person who is joining in my LLC with 10%, is a good friend and it's a favor, other than adding another MFunits deal to their resume it's of no monetary value for both of us, which makes it complicated and I want to protect this individual as well . 

** C-Corp and S-Corp aren't an option due to other limitations

[Greg Scott]

I've had non-contributory General Partners in several deals. 

Unless you are an attorney, it makes zero sense to draft one's own Operating Agreement.  Why cheap out on something that is incredibly important and also very inexpensive relative to the size of the purchase?   Same goes for advice on the other legal docs. If the deal is so tight you feel you must cut corners on legal advice, I'd consider getting out of the deal.

Note, if this is a syndication, you need an attorney experienced in SEC (federal) law.  Most of them work nationally.