Partnership structures

Define capital stack, preferred return, promote, and decision thresholds for refinances or sales before the first closing. LLC and JV structures should match who bears construction delay, insurance spike, and vacancy risk.

Agree on reporting cadence, reserve funding, capital call procedures, and dispute resolution in operating agreements — not after the first disagreement. Institutional partners expect monthly KPIs on leasing, maintenance, and delinquency.

Lenders require specific vesting and guarantor structure — form entities after mortgage counsel review, not from generic templates copied from unrelated deals.

Define triggers for capital calls on insurance spikes, assessment surprises, or construction overruns. Silent partners without call provisions can stall projects mid-renovation when reserves exhaust.

Document preferred return, promote hurdles, and catch-up provisions before first closing. Ambiguous waterfalls create disputes at refinance or sale — especially when one partner contributed sweat equity and another contributed cash only.