The Money, The People, And the Deal:
A real estate joint venture is typically where two or more parties get together to share resources that they may not have. Typically, real estate joint ventures are made up of 3 parts – the money, the people and the deal. The money is usually cash and credit, the ability to get the deal financed. The people is usually the people required to operate, such as property managers, contractors and overall management. The deal is usually the under-market value property that is tied up and ready for purchase along with necessary due diligence.
Real estate takes lots of time and lots of money to be successful and usually joint ventures are made up of two parts: the time and the money. One party takes care of the time, talent and management while the other side handles the money. In a basic joint venture 50% of the profits go to the money and 50% go to the time and talent.
There are an infinite number of ways to negotiate and construct real estate joint ventures, but 50/50 splits are an easy way to start. So joint ventures are usually made of 3 parts, the money, the people and the deal. And the value is usually divided between time, talent and money. Joint ventures are a great way to get started in real estate especially if you have no money or no time and talent.
Winning in real estate usually takes a team effort and joint ventures are a great way to put together a team to help you win.
Respect The Grind,
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