Help with JV partnership opportunity
Hello,
We have been long time readers of the BP site and have found a wealth of information. We have a single 12 unit property which has been in the family for a while. We have taken over the business for now what is 1 year and are excited about the future. We were proposed an opportunity on our first multifamily property and we could use a bit of information.
We were presented an opportunity to enter into a JV partnership and need advice on how to structure the partnership. Would like to hear any advice/help you wonderful folks at BP have to offer.
Developer wants to take out loan with us for costs to rehab of our 12 unit multifamily to improve value in order to sell (approx 200k loan). Developer will deal with construction and we will be responsible for regular operating of units. Developer to repair exterior and update 4-6 units. In a scenario like this, should the profits be 50/50? Developer would be making approx. 250k after sale if splitting 50/50. Does this seem like a fair amount? We understand that we are paying for developers time and experience but it seems excessive for the amount of work being done. What would be a reasonable split?