What’s the Best Way to Structure Compensation for Equity Investors in NYC Real Estate

[Vaknin Ronen]

I’m exploring how to best structure compensation for equity investors in NYC real estate development projects.

For example, if an investor brings in a significant share of the equity, should the deal be structured as:

• A straight preferred return (e.g. 8–10% annually),

• An equity split based on their share of the capital contributed,

• Or a hybrid (smaller preferred return + share of profits)?

For those of you who have done projects in NYC:
👉 What structures are investors here most comfortable with?
👉 What do you usually offer (or accept) to keep the deal attractive and fair on both sides?

I’m looking to build long-term relationships with equity partners, so I’d like to hear from people with local experience on what works best in this market.

Thanks in advance!