CRE Partnerships - Avoiding Some of the Most Common Partnership Killers

 Posted on December 00, 0000 in Commercial Real Estate

Partnerships in the commercial real estate (CRE) industry can either make or break your business. Most savvy investors understand this, but they may not fully understand what factors may lead them to a path of success. Learn more in the following sections, including how the assistance of a seasoned commercial real estate lawyer can help improve your chances of growing a healthy and profitable business now, and in the years to come.

Partnerships that are born out of financial convenience (i.e. because you lack capital or cannot afford to hire someone for the job) are rarely profitable. That is partly because only one person is bringing in the money, but there are other issues that can cause these partnerships to fail as well. For example, if you partner with someone who does not have the business sense to keep up, you may find yourself doing all the hard work with very little payback. You could also find yourself liable for the mistakes they make along the way. Alternatively, if you partner has capital but you have all the ideas, you risk them stealing your ideas and profiting from them on their own. Avoid such matters by ensuring you only partner with someone who can bring more than money to the table, and always ensure you have a contract that clearly outlines the duties and responsibilities of each party.

Not Developing an Exit Strategy for the Business

Partnering up without first developing a sound exit strategy can be one if the biggest and most critical mistakes that an investor can make. Partners change their minds, business relationships turn sour, and unexpected things happen. You cannot plan for them all, but you can develop a comprehensive plan that lets one partner out of the business without it completely imploding.

Partnering with a Friend (and Expecting the Relationship to Outlast the Business)

Friends can make amazing business partners; the synergy is already there, and you tend to know your partner far better. Yet it is critical that investors also recognize that a business can kill a friendship - especially if it fails. As such, you should carefully consider whether you are willing to put your friendship on the line, or if you would rather keep your friendship intact and, instead, hire someone to help you with your real estate ventures.

Contact Our Naperville Commercial Real Estate Lawyers

Partnerships are riddled with potential risks, and failure is always a possibility. A competent and seasoned real estate attorney can help you mitigate the issues, and they can assist you in developing a sound investment strategy. You can also increase your chances of favorable negotiations on each and every deal.

With decades of experience, Lindell & Tessitore, P.C. is the firm to trust. We watch out for your best interests, and we handle the complex legal aspects of your business so that you can focus on what matters most. Get started by first scheduling a personalized consultation with our Naperville commercial real estate lawyers. Call 630-778-3818 today.

Source:

https://www.entrepreneur.com/article/196912