Land owner looking to JV with Builder/Capital Partner

[Jason Martinez]

I own 10.2 acres of undeveloped land in central VT. I want to build a small SFH or STR on it. It has very favorable zoning laws, the land is buildable, and the area has a housing shortage. Land is 40 mins from Killington 15 mins from Brandon Vermont (the perfect Vermont town) 20 mins from Middlebury. I do have a quality builder that could facilitate the build but not required for JV.

Is this enough to bring to the table? If the partner was only a capital partner and had no involvement with the build would a 50:50 split be worthwhile for the capital partner? 

This would be my first JV and am open to any advice suggestions on the best way to proceed.

[Jay Hinrichs]

Quote from @Forrest Webber:

@Jason Martinez 

I think it’s great you’re thinking this through ahead of time. To answer your core question: bringing the land to the table is definitely enough value to justify being a partner, but the exact split depends on who’s contributing what.

Here’s how I would look at it:

1. Structure Based on Total Project Contribution

If your land is free and clear, I’d calculate what percentage of the total project cost it represents. For example, if the land is 30% of the total capital stack, I’d lean toward you having a 30% ownership stake.

If your partner is acting as GC or is sacrificing fees to quarterback the build, you might give them a little extra slice to account for their sweat equity.

If the other party is only bringing cash, I’d structure it so they receive a preferred return (pref) on their money before the profit split kicks in. That’s very common and fair.

2. Density & Alternative Uses

10.2 acres is a lot of land. I don't know the vehicle-per-day traffic counts (in Texas I'd check TX DOT, you might check Vermont's equivalent), but there could be potential for more density or alternative low-impact commercial uses that don't rely on heavy traffic. A few ideas:

• Small-bay industrial flex buildings
• Industrial outdoor storage (IOS)
• Boat/RV storage
• Contractor yards or laydown yards

These types of projects create stable cash flow and typically require far less management than STRs or spec home builds.

3. Minimize Your Risk

I totally get not wanting to manage a spec build from 500 miles away. That’s why I like low-impact commercial uses—they require less day-to-day involvement once leased.

Bottom Line:

You’re on the right track. If you’re not bringing additional cash but you’re contributing land, structure the equity by percentage of total project value. If your partner adds sweat or sacrifices fees, give them a reasonable bump. If it’s just cash, they should get a preferred return first, then split profits.

Happy to brainstorm more if you want.

he owes 50k on the dirt I think this is going to be a tough one.

1. remote and rural
2. no experience
3. needs well and septic unless I guess the well is already there.
4. lack of builders but maybe he has one.

this would be a good project in my mind for a modular home. not a stick built but either way going to need more cash into the deal to pull it off I highly doubt any investor would be interested in this as a money making propistion.. might be a good friend and family though.