Real estate joint venture requirements:
Firstly, We need to find the land-owner who has a big plot in one of the prime areas of a Metropolitan city. Secondly, Make sure the landowner is interested in giving his plot to one of the reputed developers for real estate joint venture. After that, gather expectations or requirements from both the developers and landowners.
Location is one of the prime concern for developers as that will play a key role during the time of selling flats or commercial space. That is also the primary reason by which landowner can negotiate as well. Percentage share between the two parties, type of construction, the reputation of the builder etc. are other key factors landowner usually look for.
Real estate joint venture process:
Firstly, If you are a mediator, Get a mail confirmation from both parties regarding the commission fee in percentage. Don’t give the location or exact owner details until you get the confirmation.
Secondly, Make sure the requirements of both the parties are close enough and the deal can go positive. After that, arrange a face to face meeting between the two parties. Finalize the terms and conditions in the meeting and get the signatures of both parties in the agreement accorsingly.
Real estate joint venture agreement:
- Firstly, Distribution of profits and exit strategy are the key points in the agreement.
- Secondly, contributions of both the parties should be neatly explained. These contributions include land, capital, operational, expertise and management dimensions of the real estate joint venture.
- In addition, Make sure to have a condition on project completion date and the consequence if the condition is not met.
In conclusion, Joint venture business is one of the most profitable business with least capital. However, you need to have lot of data and networking skills.