- Joined
- Jun 1, 2011
- Messages
- 142
Hi REINation,
If Mr X owns a commercial land to be contributed to a JV partnership with Mr Y who will finance the construction of small commercial plaza, what's the best formula to get a reasonable split?
Option 1 - Mr X's assessed land value (or market value?) (eg., $4M) + Mr Y's estimated project costs ($6M) = total investment ($10M), so the split is 40% (Mr X) and 60% (Mr Y). Is this approach reasonable?
Option 2 - Mr X gets 25% for his land contribution and 75% for Mr Y who will finance the project and manage the operations.
Any suggestions please? Thank you.
If Mr X owns a commercial land to be contributed to a JV partnership with Mr Y who will finance the construction of small commercial plaza, what's the best formula to get a reasonable split?
Option 1 - Mr X's assessed land value (or market value?) (eg., $4M) + Mr Y's estimated project costs ($6M) = total investment ($10M), so the split is 40% (Mr X) and 60% (Mr Y). Is this approach reasonable?
Option 2 - Mr X gets 25% for his land contribution and 75% for Mr Y who will finance the project and manage the operations.
Any suggestions please? Thank you.