There is no black and white answer to this question (unfortunately), there are legal and tax implications to both. I recommend that the two of you write a small business plan together. Then take that to a REIN accountant and a corporate lawyer, take both of their recommendations (they will differ because of their areas of expertise) and then make the final decision from that.
It would be GREAT if it was simple, and if someone tells you that it is... they`re not experienced enough in the many variables in business/real estate relationships.
One third option is to have a corporation that owns the property in trust for the joint venture that you have signed.
