Are Joint Venture Partnerships Right for Me?
I recently came back from our first family vacation since 2019. We decided to go away on a last-minute vacation to Hawaii and it was magical! The stunning beaches and sunsets, swimming in the ocean, the local food dishes – those are just some of my favourite highlights from the trip. This vacation was exactly what my body, mind and soul needed to reset and re-charge before heading into the last few months of 2021.
Now that my Hamilton flip has officially closed, my Joint Venture partner and I are already working on our next project together: a conversion of a 6plex mixed use building into a 12plex property in Welland.
This is definitely a bigger project than anything I’ve ever done before, and while I’m always willing to stretch myself and learn while I grow my real-estate portfolio, I like having the benefit of working with a partner, especially one that brings a different skill set to the table.
I’ve done a few Joint Venture deals over the years and I believe there are many benefits to partnering with someone, whether you’re just starting out in your real-estate investing journey or scaling your portfolio.
First of all, what is a Joint Venture? It’s simply an agreement joining together 2 or more parties for the purpose of executing a particular real-estate undertaking, where each party commits to performing certain duties.
Why would anyone choose to Joint Venture?
Well, some common excuses when it comes to investing in real-estate are that people say they don’t have the (pick one or a few!): time, money, contacts, experience, knowledge, credit, etc.
Through a Joint Venture, you’re able to partner with other people who can give what you don’t have, and vice versa, so everyone can participate in real estate deals. This is what creates a WIN-WIN situation!
Determining the nature of the Joint Venture and what each party brings to the table is flexible and can vary per deal.
For example, you may be someone who has the capital and credit to invest, but no idea on how to get started, or where to invest, or how to analyze a property, screen and manage tenants, be a landlord, etc. You also have NO TIME to figure all of this out because you’re working a full-time job and raising a young family.
While all these points (or excuses) are valid, this doesn’t mean you have to sit on the sidelines and not invest at all!
Consider partnering with someone who is an active real-estate investor, and that already has the contacts and experience needed to source, negotiate and manage great investment properties. This can also give you an opportunity to learn through the expertise of this other joint venture partner, especially when you’re first starting out.
Yes, you will make more money (or maybe even lose more!) if you’re doing it on your own, but sometimes people don’t take ANY action because they get overwhelmed with the fear of the unknown…so basically, they stay in the same place.
I say, it’s better to earn 50% of something, than 100% of NOTHING!
If you’re someone who has been thinking about investing in real-estate for quite some time now, and are struggling to figure out how to get started or have no desire to be an active landlord, then maybe a Joint Venture Partnership is right for you!
I love working with joint venture partners, so reach out to me if you’re interested in participating in an upcoming project.
Until next time…. happy investing!