Joint Venture Investing with Uncle

Akron, Ohio
Multi-Family and Apartment Investing
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Joint Venture Investing with Uncle

Tyler Ligan
Member since 2025 · 5 posts · 20 votes
Recently my uncle approached me and proposed going in on a joint venture multi-family investment. As a person already wary of putting money between family, there is a multitude of reasons why it piqued my interest. Looking for some advice on best methods of practice for this, initial contracts to have outlined, minimum participation clauses, exit strategies, whether we should make an LLC or not, etc. Open to any and all help/information. Thanks!
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Stuart UdisPro Member
Attorney · Philadelphia · Member since 2018 · 2k+ posts · 3k+ votes
8mo

That question is far too broad to provide any meaningful insight. With any real estate partnership, the analysis starts with what each party is actually bringing to the table.... Experience, contribution of real estate, labor, capital & balance sheet strength for loan guarantees are common factors to consider as well as objectives.

Those inputs form the foundation of the partnership, and the way the partnership is structured flows directly from them. Without knowing what you and uncle are providing or your objectives, it's really difficult to provide insight.

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  • Stuart UdisPro Member
    Attorney · Philadelphia · Member since 2018 · 2k+ posts · 3k+ votes
    8mo

    That question is far too broad to provide any meaningful insight. With any real estate partnership, the analysis starts with what each party is actually bringing to the table.... Experience, contribution of real estate, labor, capital & balance sheet strength for loan guarantees are common factors to consider as well as objectives.

    Those inputs form the foundation of the partnership, and the way the partnership is structured flows directly from them. Without knowing what you and uncle are providing or your objectives, it's really difficult to provide insight.

    [email protected]
    1Reply
  • Frank PyleBusiness Member
    Specialist · USA · Member since 2024 · 279 posts · 130 votes
    8mo

    Family JVs can work but the only way I have seen them stay clean is to treat it like a deal with a stranger and get everything in writing before a dollar goes in. I would set up a separate LLC for that one property, use an operating agreement that spells out who brings cash, who signs on the loan, who manages day to day, what decisions need unanimous approval, how distributions work, and what happens if someone wants out or stops participating. On the exit side you want a clear buy sell clause with a simple valuation method, plus rules for forced sale, refinance, or capital calls so nobody gets surprised. Also be realistic about whether you are actually partners or if one of you is passive and should be treated more like an investor with preferred return and limited voting.

    Is your uncle expecting you to help run the property or just bring capital. What kind of numbers are you looking at on purchase price, down payment, expected rents, and who is going to be on the debt.

    [email protected]317-501-3467
    Frank Pyle at ExP Realty
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  • Arman AhmedPro Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 931 votes
    8mo

    @Tyler Ligan

    Hey Tyler, family JV deals can work but you want everything documented clearly. Make an LLC or LLC operating agreement to outline ownership %, roles, decision-making, distributions, exit strategies, buyout clauses, and minimum participation expectations. Keep contracts formal, outline how disagreements are handled, and consider having a neutral attorney review. Transparency up front prevents future family conflicts.

    [email protected]614-418-6081
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  • Jared Cornell
    Property Manager · Binghamton, NY · Member since 2017 · 5 posts · 1 vote
    8mo

    @Tyler Ligan congratulations on deciding to pursue your first deal! For family ventures we have utilized LLC's, however the best advice I can provide is make sure your operating agreements are clear for the good and the bad even with family. Ask for clear verbiage on handling disagreements and exit triggers. Not having a way to exit can cost you thousands.

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