Hello hello ladies and gentlemen,
I’ll try and make this quick and to the point (yeah right!). Here’s a hypothetical situation I am interested in hearing your opinions on:
If one had money to buy land and finance the construction of a 4-duplex (8-unit) development, and was interested in doing so, what direction would one go regarding the structuring of a partnership with a builder/developer? This money person is not really interested in being a silent partenter. This person also has a background in construction but is not interested in contracting, let alone building, the duplexes. Perhaps his role is more like that of a coach who owns the ball park, but not the team.
My initital thoughts are to partner with a developer who does this sort of thing regularly. My questions mainly pertain to the general money set up. For example, would the money partner finance everything up front? Buy the land and then get a loan for the construction? Finance the land, split the materials, and have the partner finance the labor? How about splitting profits?
I realize there are many ways to skin a cat, and that the lawyer would have a handle on these issues, as well as the developer. I was hoping some of you out there mught have stories or thoughts about the topic, no matter how general. Suggestions for further readings, etc., are also very much welcome.
Thanks!