Hi. It's Rob from Property Investments UK. In today's video, we're going to be looking
at five things that your joint venture partner is probably going to be expecting from you
and that you must deliver. Okay. The first thing is honesty. You've got
to be very upfront and honest with your joint venture partner. This isn't just about somebody
bringing money or property deals to the table. It's much more important than that. It's an
ongoing relationship. You've got to be honest about what your experience and current situation
is. For example, if you are maybe looking at becoming a property sourcer and find property
deals for investor clients, then you don't want to be going to those clients and saying
I've got this wealth of experience and I've done these deals in the past, if you've never
been doing anything in property before. You've got to be honest with them. If that is your
situation, if you've not got any current experience in property at the moment, then that's okay
for some clients. Some people are okay with that because they
will look for other qualities, maybe you're very tenacious and you've got an idea of exactly
what you want to achieve and you're going to go out and do plenty of viewings and put
plenty of offers in on properties and that's exactly the type of partner they want. Or
maybe you're in a situation where you have some very good contacts that you can leverage
and you can work with. You may have some good relationships with letting agents
or refurbishment teams or mortgage brokers that they don't currently have. There's still
lots of value that you can bring to the table and it might not be because you've got 10
years experience in property or it might not be because you you've done 50 developments
in the past. It's important to just be
honest and open about where you're currently at and then you can see who's the right fit
for both you and the other party when it comes to doing those joint ventures.
Number two. I'd say it's very important to have a clear plan of action in mind. This
is where the joint venture agreement comes into place because outlines exactly what you and the
other party are going to be looking at doing, but trying to understand exactly from day
one what you want to achieve because that's going to help you find the client is the right
fit for that type of stuff. For example, type of joint ventures that we do currently in
house with clients primarily are flip projects. It wouldn't work for us if I started off a
relationship or conversation with a client and said okay, they want maybe to build a
portfolio and do joint ventures that way. If that's not what we're currently looking
to achieve, then it doesn't really help to start off a process or a deal in that relationship
because we've got completely different ambitions and aims of what we want to do with those
projects and properties. It's important to have a clear idea in your
mind of what you want to achieve and a clear idea of what the investors and other parties have in
mind of what they're looking to achieve and make sure there's a fit. Having a clear plan
of action, having a JV agreement is going to help that so much better.
Okay. The third thing is having aligned goals as well. This is principles in terms of what
you're looking to achieve and what they're looking to achieve and also what your aims
and ambitions are. If you want to go very high end in your refurbishments for example
and do flip projects, but your joint venture client wants to have the opposite type of
property deal or the opposite type of finish, that is a mismatch there. You need to have
aligned aims. You need to have aligned ambitions, ideas of what you both want to achieve, and
also ideally, morals, ethics, all of that stuff that combines to make a very strong,
good relationship going forward as a joint venture.
Number 4, I'd say is looking at opposing skillsets. What you want with the joint venture
is not where you have two individuals whose one and one equals two. You want one and one
to equal three or more, so it's going to achieve much better returns in the long run. Now,
that might be opposing skillsets in terms of somebody's very good at finding deals and
somebody's very good at reselling them or very good at finding the tenants or has the
funds or the finance to invest in those projects. Just something where those opposing skillsets
can really mix and merge to create something that's very valuable, especially. Rather than
trying to go into the relationship, maybe where you do a joint venture, where you're
both offering the same things. Because then it starts to create some form
of conflict, you can't divide tasks efficiently, and you start to then get a little bit frustrated
over the progress sometimes because you're not achieving what you'd originally aimed
for because maybe one party's doing much more than the other. That's very often the case
when you've got similar skillsets, so it's great to have opposing skillsets when it comes
to joint ventures. Finally, the fifth one is open communications
at all times. Going back to the honesty side of things, you've got to remain open and honest
with your clients and your joint venture partners. If you're in a situation where a project is
going great, fantastic, everyone's happy it's making money. If something changes, if something
happens in the project, you've got to be open with them. You've got to be honest. You got
to keep that line of communication always available so that you can figure out the best
way forward. We had a project recently that we were doing with a joint venture client.
There was a bit of an issue on the refurb where the wall at the back of the property
after we'd finished the project, after it'd gone on the market for sale, there was a bit
of an issue with the structure of the rear wall, not the main building, but the fence,
effectively, at the back of the yard. That just needed fixing. If that wasn't a
conversation that we'd had with the joint venture partner and then we'd had just viewings
that went around to the property and we weren't getting any feedback, we weren't getting any
sales or any interest in the properties, simply because we thought we've done the refurb now.
We don't need to consider that. You then would start to run into difficulties. You've just
got to be honest. We had a conversation with them said look, this needs now fixing after
the refurb, so you can get it sorted. The costs are this. It's going to take this timeframe.
This is the company that's going to do it. This is when it will be ready by, all that
kind of stuff so that you can go to them with a fully fleshed out idea, but you got to keep
that line of communication open. Just as a very quick round up,
those five key things that are going to help you with your joint venture contracts to make
them effectively work much better. That's going to be honesty. It's going to be making
sure you have the line of communication is open, making sure you have opposing skillsets,
so you're not treading on each other's feet in that respect and you've got other
things to bring to the table. Then finally, a clear plan of action and aligned
goals. Those five combined elements are going to help you to create and structure much more
successful joint venture deals. Hopefully, that's been helpful for you and give you a
bit of an insight, in terms of your next joint venture project.
Thank you for watching this video. If you like this content and you'd like to join our
free online property training course, we've got a link for it on this page. In there,
we cover a range of different property strategies to help you get started,
either building a long term property portfolio or creating cash flowing property business.
We also look at ways to increase your return on investment with any of the property
deals that you may be considering and we also have a couple of cheat sheets and
downloadable documents in there as well. Simply click on the link to join the free training
course today.