Property QuizJoint VenturesFinanceStrategy

Standard JV Equity Splits

A common Joint Venture (JV) structure involves a 50/50 profit split, where one partner provides 100% of the capital, and the other partner finds, manages, and executes the deal.

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Joint Ventures (JVs) are the lifeblood of experienced property developers seeking to scale without being constrained by their own cash reserves. The most classic JV structure is the 'Money Partner / Time Partner' arrangement.

In this scenario, the Money Partner provides all the capital required for the deposit and refurbishment. The Time Partner (the property expert) sources the below-market-value deal, project manages the builders, handles the refinance, and manages the tenancies. In return for marrying capital with expertise, the ultimate profits (both monthly cash flow and capital uplift) are split 50/50.

Structuring the Deal

These JVs are typically structured by creating a new Special Purpose Vehicle (SPV) limited company where both partners are 50% shareholders. The Money Partner's funds are injected into the company as a Director's Loan, ensuring their original capital is paid back before any profits are distributed.

Test your knowledge

In a classic property Joint Venture, what is the most common profit split between a partner providing all the money and a partner doing all the work?

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