Choosing a structure

Unless promoted by a single entity (whether or not with mortgage funding) many developments take place through some form of collaborative joint venture structure (commonly referred to as a ‘JV’). This Practice Note describes the corporate and contractual JV structures most commonly used to govern collaborations between landowners, developers, funder and investors in property development. For further guidance as to which structure to adopt in any given scenario, see Practice Notes: Setting up a joint venture—choice of structure and Property Joint Ventures—choosing the right structure.

JV company

A JV company has a legal identity separate and distinct from its shareholders and directors, who (subject to proper management and solvency) operate with limited liability. Shareholder agreements regulate the collaborative relationships between the participating shareholders. Being a private document, the shareholder agreement is not available to competitors, creditors or employees.

The JV company in its own right may enter into separate contractual arrangements for:

1. •

   site acquisition

2. •

   planning and statutory agreements

3. •

   building contracts and appointment of the professional team

4. •

   pre-let agreements with tenants

5. •

   forward