Property Joint Ventures—general issues
Property Joint Ventures—general issues

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

  • Property Joint Ventures—general issues
  • Why enter into a property joint venture?
  • Key considerations
  • Commercial issues
  • Structural issues

Property Joint Ventures—general issues

A property joint venture is an arrangement between two or more parties under which they combine disparate contributions in order to derive value from the development, acquisition or management of property. Although in the vast majority of instances that value will be measured in terms of income or capital profits, there are some joint venturers (such as local authorities) who participate for social reasons (eg in relation to urban regeneration schemes, community projects, etc).

The contributions made by the joint venturers will usually involve some combination of:

  1. cash, or the ability to enter into financing commitments

  2. tangible assets (eg land)

  3. intangible assets (eg expertise, intellectual property, construction services, contractual rights, etc)

The parties who typically participate in property joint ventures include property companies, developers, onshore institutional investors, offshore investors, landowners, local authorities and other public sector organisations.

Why enter into a property joint venture?

A property joint venture allows the parties to it to:

  1. share risk, and also to place specialist risk with specialist participants

  2. combine resources to leverage the scale of a party’s usual operations in order to achieve greater returns or liquidity from their assets

  3. make non-financial contributions to a project (eg construction management) in return for an equity share rather than simple payment of a contract sum or fee

  4. gain access to specialist experience in relation to development, or asset management, or

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