Real Estate JV Partners – The Good and the Bad
In many cases you can not do it all by yourself. Especially in our case in which we live thousands of miles away from Manchester. I have had a long career in real estate and I have had the good the bad…and the ugly. So what makes a good JV partner in real estate as well as bad?
In our personal case…
The good
- Integrity
- Honesty
- Fantastic communication
- Understanding each others needs
- Never letting down the counter party JV colleague
- Looking at big picture
- Masterminding
The Bad
Actually the bad is the opposite of the above. People show their cards. Sometimes early in the relationship and sometimes much later. One of my first examples is when I hear ” Leave it to me” which I do…and it is left and nothing happens. I have had this countless times…However to the contrary my JV partners have stepped up to the plate. One night there was a flood in one of our HMOs. I got a phone call at 10pm and he was there with a plumber and expressed the exact problem. Not hiding the fact. Straight to the point and handled it! Another case we had to repair a gable wall. It was a costly and big job. Bottom line it was taken care of. Another of my JV partners took care of a backyard wall that was damaged by storm. He got quotes and he handled it from A to Z.
These are signs of a good relationship! To the contrary we built houses for 10 years plus. You would think you know your JV partner. However the money went to his head and he started living a very high life style. Several hundred thousand a year was not enough profit for him. He thought he could be clever and build “our houses” and his houses with ” our materials”. This did not take me too long to figure out and the relationship of 10 years ended abruptly.
With all my years in real estate….If you and your partner do not share the same goals and strategies, you are going to get frustrated and bang heads. Look for JV partners with different skill sets. These different skill sets can create a mutually beneficial synergy. You might not agree on everything, but you’ve got to be able to get along and work in synergy. Your interests should be more aligned than just wanting to make money in general.This goes back to basic integrity and honesty.
What are some of the issues you’ve had with your JV partners? What signs do you think indicate that you’re entering into a good partnership?
I always want to learn…
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