How To Structure Real Estate Deals
Summary Guidelines and Considerations to structuring real estate deals
1. What are the portfolio level implications?
2. What are the asset level characteristics?
3. How do I invest?
4. With whom do I invest?
5. What do I get for my investment?
6. What protections do I have?
7. When and how do I exit?
When considering the asset level characteristics:
1. What are the risk/return characteristics?
2. What are the key risk/return sensitivities?
3. Is the due diligence plan focused on the key risks and performance drivers?
How do I invest?
1. What is the appropriate form of legal ownership?
2. What is the most tax efficient legal structure?
3. Are my interests aligned with my counterparty´
What protections do I have?
1. Does the investor want to employ any leverage?
2. Is leverage is used, how much is used and under what terms?
3. Are the fees being paid by the counterparty aligned with the investor´s interests?
4. What, when, and how can the investor force a liquidation?
5. what are the obligations of the owner to liquidate the investment?
6. How should the investment be structured, keeping in perspective the desired methods of exit?
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