Structured joint venture financing maximizes cash flow potential for the borrower by including the lender as an additional investor in the project. Similar to a partnership, but only for a specific project, a joint venture is a contractual agreement between two or more parties to share in the costs, profits and losses associated with the venture.
A borrower may not initially be searching for a partner in a project, but some recognize the value of a sharing equity in a joint venture over traditional financing. When joining together with additional investors, your business gains a competitive advantage, since it is now able to pursue larger opportunities. An investor should look to partner with a lender who can create value for the project in ways that they can’t. This value can be anything from single family units, to multi-home developments, more effective property management, or asset rehabilitation.
Bedford Realty Partners, LLC
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