Leaving your job: What am I entitled to from my employer?
Property Development: are you using an LLP?
When you put together developers (who want to minimise bank borrowings/charges) and private investors (wanting a great return on their cash) you have the makings of a lucrative joint venture.
Many of our clients are currently using limited liability partnerships (LLPs) to structure their projects. Why?
- LLPs are often the most tax efficient structure.
- They offer flexibility for the parties.
- Limited liability as regards dealings with third parties applies as it does with limited companies.
- There is far less regulation/cost in terms of administration.
- Banks are just as happy to lend to them if the figures stack up.
Why do you need a thorough and considered joint venture agreement rather than a standard template or an agreement you have used before?
- Because every project is different.
- Developer and investor want to be clear on:
- Costings;
- Plans;
- Specifications (external and internal);
- The parties’ roles and responsibilities;
- What they will do if further funding is needed;
- Their likely buyers;
- Projected profit and what each party’s profit share will be;
- How to quickly resolve problems/variations that occur along the way (the agreement should have the mechanisms to do that efficiently).
The LLP Agreement needs significant factual input on the above from the parties at the drafting stage for it to work and good legal and tax advisers to make sure it is not a “one size fits all” document. That will ultimately best safeguard the project’s profits.
If you would like to discuss LLP Agreements or any other Corporate matters, please contact Nicola Vincent at nicolavincent@meadowsryan.com or Piers Meadows at piersmeadows@meadowsryan.com or on 01932 852057
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