There are many reasons why you would consider joining someone else to undertake a joint venture development project.

Usually the most basic reason revolves around something you don’t have.

Some of them can be:

1. I have land … I have capital and the ability to borrow … but I have no experience.

2. I have capital and ability to borrow … partner has land … both have no experience.

3. I am ‘time poor’ … I work full time and cannot get personally involved …

Suppose you want to find an owner who will put his land
In the Joint Venture, (JV) and your land will be your main contribution to the deal, plus some loans.

Let’s consider the implications of getting into a JV in the first place.

After all, in a joint venture you have to consider someone else’s attitude, the decision-making process (or the inability to make a decision), whether they have a sensible and logical mind … the list goes on.

So entering a JV must have a good revenge for you. Whatever you lack is usually the reason for entering a JV.

I’ve noticed over the years that joint ventures have a primary motivator, the driver of the deal (you) and the other person agrees.

For instance: the other party may have a wonderful property (site) and wants to develop it, but does not have the knowledge. You “love” the site and know that it could turn it into a very successful and profitable real estate development. You approached the owner of the land.

Another example: maybe two people who have saved their capital, however individually it is not suitable to undertake a project. Combining their capital and debt capacity will allow them to continue.

I prefer a joint venture where both parties are equally motivated, have different skill bases, but each sees the other as contributing equally.

You know the feelings that can occur “I’m working harder than you …
all you do is phone and number processing work … i’m always out
and how to deal with actual work on site. “

Don’t forget why you got together in the first place.

So there are many reasons for JVs. However, you must be clear about why you are doing it, and it must be secured by a legally prepared Joint Venture Agreement.

Much ‘practical people’ I hate legal documents … a JV Agreement it is a legal document and both parties must understand what it says. If one of you is a little lazy at this point, it’s up to the other to sit down and check it out … it’s important!

Why?

Suppose the joint venture agreement hits a bad patch and your partner says, “I didn’t know that … why didn’t you tell me … I left you all that legal crap … blah blah?” Understood, have the arguments early in the deal … not later.

FOR JV Agreement it establishes what each party will contribute, both in money and effort, and establishes the obligations of each party. It also establishes what happens if the parties ‘fight’ with each other, as well as the division of profit or loss.

There is much more at stake if you hang out with your brother-in-law, another relative, etc. ‘nightmare in progress’ is a phrase that comes to mind easily.

And if one of those family joint ventures collapses, it doesn’t matter how many pages are in the joint venture agreement, or what the words say to prove it. you’re right,” … as far as YOUR brother-in-law is concerned, you are a ‘expletive removed’.

I just thought about getting that out of the way !! OKAY?

One more thing … doing a JV with a rich person, when you are many levels poorer than them, it is not smart either.

Why?

Well, in simple terms, when ‘Time of truth’ money rules …
The golden rule says: He who has the GOLD, RULE.

Also, if the rich man tells you not to bother with a JV arrangement … it seems like he’s saving you money … tempting, huh? … what you are really doing is taking away your legal rights.

Yes, you will have fewer rights than an employee. If that’s the deal … better be an employee!

In my e-book, I emphasize the importance of organizing the structural work of the company: you will build a much better development business from a secure foundation.

When you are interviewing associate professionals, try to see if they, personally, have any entrepreneurial tendencies.

They may have land, houses, houses to renovate, etc. but they don’t have the ‘TIME’ or ‘SKILLS’ to do the job themselves.

Don’t go out and ask them right away … follow my ebook, do the work you want to do; that’s evaluating them … but keep your antenna out of any signs of common interest.

Okay, let’s get back to seize a piece of land.

Know the local real estate agents; I mean to know them well.
Remember what I say in the e-book.

Call them and buy them a cup of coffee, take them out of their workplace;
What about dinner after work? really express yourself.

Invest your time in finding good, knowledgeable and dedicated agents. Believe me, they are in your business community … it’s your job to find them.

Appreciate that agents are essentially self-employed, regardless of whether they work in a real estate agency … their “mindset” is independent.

They support themselves and their abilities to provide a sales service to
level that “consistently” provides them with a “good income.”

That ‘good income’ by the way, will leave most of the income of your ‘client’
looking a little anemic.

The “good agents” are busy; your ‘time’ is money; literally. So don’t mess them up.

Don’t talk to them like you’re the Aga Kahn! You are not. There’s always a guy richer than you … maybe the Agent!

Why am I insisting so much on the agents?

I think “people” get the agents “they deserve.”

I’ve heard people talking to officers like they are a dirty leech of society and they are honored to even talk to them.

To be a successful agent these days you have to be very good. Many are highly educated and choose real estate as a career for freedom,
individual reward and great benefits.

What comes out of your mouth + body language tells an agent a lot about you. Then they wonder why the Agent never calls then … Dong !!!

Keep your ‘ego’ in check. Your success in sales is based on your ability to “read people.” Remember what I say in my ebook!

When you are in the development business, you are in the business of:

Get people to do … what you want them to do
Within the ‘TIME’ AND ‘Costs’ that you establish.

That means you have to be in control of ‘How you treat people’.
Agents know a lot of people … maybe, they even know people who I want JV with you.

While doing this “work”, don’t forget to do what my e-book tells you
what to do about the investigation.

Last idea to find JV people – talk to your friends – place an ad in the local newspaper looking for expressions of interest from people interested in doing what you want.

Well, you have found a partner who has the land and you feel comfortable with the relationship after several meetings.

Important question! What value does your prospective partner place on your land that will be put into the joint venture?

Just throw in a few figures to give you an example.

Let’s say the market value of your land right now is $ 300,000. But he wants to invest in the joint venture for $ 400,000. So if your Joint Venture Agreement involves you making a share of the profit, your share will be $ 100,000 less. It is understood?

Now let’s say that part of your skills contribution to the JV includes a
rezoning the land to a higher level and that is accomplished for the joint venture.
That rezoning could take land away from a single unit dwelling (house) zoned to a unit of six houses zoned.

Their efforts have significantly increased the value of the land … no, not six times, as home properties are valued differently than multi-unit properties. But it may have increased 3 times or more depending on your market.

Once again, the $ 100,000 will come from you. Now that may be fine for you, because you are just starting with your first development … it’s always better to KNOW what you are agreeing to as well.

I hope this information helps you consider participating in a joint venture.
but remember, don’t just read my e-book … study it … make notes on a special hardcover Development Copybook you’ll buy.

Writing things down is an aid to learning and remembering.

My LAST NO … Don’t start any of this JV until you know my eBook
Inside out. You should not only be able to ‘lead by example’ – you must know what you are talking about.

What I’m talking about is helping you make a residential development with reduced RISK.

If it takes four years of study to get a basic degree and another five to get some experience, why would you think that you can enter the development business with little study, no experience, and expecting to be profitable?