Updated almost 7 years ago on . Most recent reply
Entity structure for scaling rentals and flips
I'm curious how some of you structure your businesses. We're looking to create an entity structure that will support owning 100+ rentals and doing 30+ flips/yr with a handful of staff members.
Right now we're thinking of having: 1) An LLC that owns a series of Single Member LLCs that each own a couple properties - either rentals or flips, not to be mixed. This is be more of a real estate holding company. 2) A separate LLC to perform property management duties for the rentals, as well as manage deal [flip] sourcing and construction/project management. This would be the entity that has all staff on payroll The question is whether entity #1 or entity #2 should be paying for the rehab construction. My inclination would be to say that #2 should be writing the checks to the contractors and invoicing entity #1 for the work performed, however, I don't want to make things too complicated. Any thoughts on this?