TOPAZ Property Partners JV

Customized Strategic Joint Sponsored by TOPAZ

TOPAZ Property Partners LLC (“TOPAZ JV”) is a comprehensive joint-venture multifamily-centric platform operating across the State of Florida. Our goal is to partner with owners, operators, property managers, and developers of multifamily properties, leveraging our expertise, experience, and capital to facilitate their growth.

With TOPAZ JV, partners gain access to funding of up to 90% (but no less than 51%) of the total capitalization costs, including loan co-guarantees. Additionally, we offer a commitment to forward purchases, providing increased certainty of execution. Through our strategic partnerships with successful real estate companies, we provide co-investment opportunities for multifamily assets. Our investment strategies encompass a wide range, from stabilized income-producing properties to later-stage multifamily development projects.

Benefits

At TOPAZ, we focus on partnering with real estate companies that have a strong track record, managing no less than 5,000 units at the property management level and completing 2,000 units at the development level. With our co-investment option, sponsors and developers maintain control of the property while benefiting from our transactional, management, and construction expertise.

Access to institutional-grade capital
Competitive financing rates
Commitment to forward purchase
Increased certainty to close
Leverage TOPAZ’s acquisitions and development expertise
Professionally managed property
Negotiated ownership control & participation
Top-tier loan terms

TOPAZ
JV Friendly Capital

Sourcing

Structuring &
Underwriting

Investment Committee
Approval & Closing

Asset Management

JV Partner
Multifamily Developer /
Operator

Due Diligence

Local Market
Information

Third Party Reports

FAQ’s About Real Estate Joint Ventures

What is a Real Estate Joint Venture (JV)?

A real estate joint venture (JV) is a deal between multiple parties to work together and compile resources to develop a real estate project. Most large projects are financed and developed as a result of real estate joint ventures. JVs allow real estate operators (individuals with extensive experience managing real estate projects) to work with real estate capital providers (entities that can supply capital for a real estate project).

The Different Players in a Real Estate Joint Venture

As mentioned above, most real estate joint ventures are comprised of two separate parties: the operating member and the capital member. The operating member is usually an expert on real estate projects and is responsible for the daily operations and management of the real estate project. A typical operating member is usually a highly experienced professional from the real estate industry with the ability to source, acquire, manage, and develop a real estate project. The capital member usually finances a large part of the project or even the entire project.

In a Real Estate Joint Venture, each member is liable for profits and losses relating to the joint venture. However, this liability only extends as far as the particular project that the joint venture was created for. Aside from this, the joint venture is separate from the members’ other business interests.

Structure of a Real Estate Joint Venture

In most cases, the operating member and the capital member of the real estate joint venture set up the Real Estate project as an independent limited liability company (LLC). The parties sign the joint venture agreement, which details the conditions of the joint venture such as its objective, the contribution of the capital member, how profits will be split, delegation of management responsibilities for the project, ownership rights of the project, etc.

However, a real estate joint venture is not limited to an LLC. Corporations, partnerships, and several other business arrangements can all be used to set up a joint venture. The exact structure of the JV determines the relationship between the operator and the capital provider.

Key Aspects of a Real Estate JV Agreement

A real estate JV agreement involves the following factors: 1. Distribution of profits: An important distinction to make when drafting the terms for a joint venture is how the members will distribute profits generated from the projects. Compensation may not necessarily be equally distributed. For example, more active members, or members that have invested more into the project may be compensated better than passive members. 2. Capital contribution The JV agreement needs to specify the exact amount of capital contribution expected from each member. In addition, it must also specify when this capital is due. For example, a capital owner may agree to contribute 25% of the required capital but only if this contribution is made at the last stage of the development process (last money in). 3. Management and control The JV agreement is expected to specify in detail the exact structure of the JV and the responsibilities of both parties regarding the management of the Real Estate JV project. 4. Exit mechanism It is essential for a JV agreement to detail how and when the JV will end. Usually, it is in the best interest of both parties to make the dissolution of the JV as economical as possible (i.e., avoid legal fees, etc.). In addition, the JV agreement must also list out all the events that might allow one or both parties to trigger a premature dissolution of the JV.

Most Common Reasons to Form Joint Ventures

Real estate management, acquisitions, and development partners enter into joint ventures for the following reasons: 1. Complements GPs bring industry expertise and put time and effort to manage the project, while LPs provide the capital required to fund the equity portion of the project financing. 2. Incentives GPs are provided with disproportionate returns to keep them motivated to work hard. 3. Structures Investors possess limited liability and liquidation preference in the case that the assets of the partnership are liquidated.

Other Uses of JV Agreements

A joint venture agreement also allows businesses to take part in investment projects that they normally would not be able to join. Primarily, it allows a company (home company) to invest in projects in other countries by entering into a joint venture with a local partner. In this case, the home company may either be the operating partner or the capital partner. Many countries impose restrictions on foreigners entering the domestic real estate market. In such cases, setting up a joint venture agreement with a domestic company is often the only avenue into the country.