Property development joint ventures—acting for a funder
Property development joint ventures—acting for a funder

The following Property practice note provides comprehensive and up to date legal information covering:

  • Property development joint ventures—acting for a funder
  • Structure
  • Key issues for the funder
  • Security
  • JV with a public sector party


This Practice Note assumes that the funder is only providing funding to the JV (ie a loan of cash where the loan will be repaid with interest), but if the funder is seeking to be a party to the JV, please see Practice Note: Property development joint ventures—acting for an investor in which a funder's position as an investor is considered.

Similarly, if the funder is to forward fund the development—known as a forward funding or forward sale—the funder will normally acquire the property in its own right and grant the developer a licence to carry out the development works. This is, ultimately, an investment by the funder, with its return coming from lettings or other disposals of the completed development. This in its strictest sense also is not a joint venture and can be structured contractually through a forward funding agreement/forward sale contract. For further information see Precedents: Forward funding agreement and Forward funding agreement between the fund and the developer, part pre-let, design and build procurement, with existing planning permission for a retail park, and guarantor provisions: Encyclopaedia of Forms and Precedents [2].

The structure contemplated by this Practice Note is that the funder is funding a development project which involves a loan to the borrower JV for the JV to purchase and develop property to be acquired or to develop property that it

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