All Forum Posts by: Roberto Buttazzoni

@James Galla That’s so simple, what a good idea. Get the work priced out by a few contractors and take lowest bid and have that as my financial contribution.

To clarify; my wife and I invest together and own our corporation as directors. My sister-in-law will be our first investment partner my wife and I are counted here as one side of the deal (50%). My wife and sister won’t do much work, mostly interior design of the renos.

@Greg Dickerson I fully agree and understand that in the grand scheme of RE you run a business and get people to do the work for you, including running contractors for rehab.

I should have mentioned I’m in Canada. Maybe different laws, we have our own set of Canadian Securities Regulations. However I distinctly recall Don R Campbell (one prolific Canadian RE author I’ve read almost every book from) stating that joint venture deals almost never fall into securities domain so long as you don’t do certain things or agree to certain things.

I’m not sure I see eye to eye with you on a joint venture deal crossing the threshold into securities. Also don’t see how my doing a few reno projects mostly myself violates any laws. Though I see what you may be hinting at... if I wanted to inflate my percentage I could just inflate my renovation work value and swing things more to my interests. These laws are surely there for a reason, not for me. I conduct myself ethically and within the law always. In the end my attorney will be reviewing all my contracts so if there’s anything that may infringe on securities laws I’ll find out about it.

Maybe my statement “passive investor” initiated this, what I really meant is that some investors just invest money and no work. But then again I need to do more research and talk to my attorney when it comes seal time. This is added to the list. This is good to know though. Appreciate the info!

Hello, I am brand new to Bigger Pockets. This is a somewhat long post of me explaining my strategy and asking for experienced advice on joint venture rehabbing... Currently I’m reading all I can about RE and from many different authors, investors and coaches. My wife and I have saved a decent chunk of money in the last 10 months and we are about to start hunting for RE. We probably could only just make our first deal on our own, however we don’t fancy that strategy. We intend on partnering with a great many of our friends, acquaintances, possibly even family immediately and in the long-term. Sister only for the first deal.

In a nutshell our strategy is start with multi-family (3-5 units) and try our best to buy a place with at least 1-2 units vacant where we can apply gentrifications to increase value. BRRRR basically... I am an expert tradesperson in my specialty and have consequently learned almost all other residential and commercial building trades to a high enough degree to perform high quality (no corner cut) workmanship myself. So we want to BRRRR unit by unit and property by property. Until we buy enough that I can't keep up and I have to hire contractors/handymen I will do almost all work myself.

The road block I keep running into, mentally mostly, is; what percentage should be fairly tacked onto my wife and my percentage for doing all the work. Sweat equity. Others are passive investors only.

For example:

Our first property will be 50/50 down payment.

The renovations will be 50/50 split on material & any other costs.

All profits will be 50/50 split as well as rents.

So where do I fit in my fair share of sweat equity? I want this to be very fair for all of us, I want to be compensated for good value increasing work and I also want my investors to do well in the deal, benefit from my work and their investment also. I want our first deal to be a huge advertisement of success that will attract other investors and friends and I want this to be a win-win situation.

I have heard of 70/30 the 30 for sweat equity only but that was for flipping.

Anyone else figure out anything for this type of sweat equity deal in the past? Something similar?

Also we don’t plan on flipping, buy and hold but definitely take the equity of renovation out of the property for the next investment.