Owner / developer Joint venture

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I’m considering partnering with a number of property owners i know as developer for spec and small apartment building projects between 4 and 12m and would need advices as to how to structure these kind of deals.

This is the first time i consider this type of arrangement as i typically purchase the land and finance my own projects. I aim at owners unwilling to sell but interested in developping. The goal here is to reduce my equity liability in the event of a sever market downturn. I’m not buying land anymore.

Basically, the owner comes with a property free and clear as silent partner and i handle everything from entitlement till disposition. I pay for engineering and entitlement and eventually bring some capital if the lender requires more collateral.

I will have a real estate attorney draft the joint venture agreements but would need examples of how it could be structured in simple and acceptable terms for both parties while limiting my liability.

My understanding is that the average developer / owner JV is structured as a LLC which owns the property; both parties agree on a price for the land that will be paid

firsthand (but after the loan) to the owner at exit and a 50/50? split for the rest. The terms are recorded in the operating agreement

All LLC partners sign on the construction loan and the land equity is used as collateral. Ideally we'd look for a non or limited recourse construction loan.

questions:

- what’s a fair split in the terms mentioned above?

- what are other possible arrangements not involving moving the property into a LLC jointly held with the developer? moving the title can be a turn off for many owners

- do developers typically charges developer and disposition/sale fees on top of the owner/developer split? I usually pay myself a developer fee scheduled monthly throught the project

- what kind of arrangement the developer can make with the owner to protect himself against market fluctuations for the land share of the deal?

As these project can tie me from 1.5 to 3 years, i don’t want a fixed land basis set today.

Maybe a percentage of the final sale amount instead of a fixed price?

thanks