Joint Ventures (JV). Another initiative taken on by AIC is the development of a Joint Venture (JV) Register. A JV is a contractual agreement between two people or entities (similar to a partnership) entering into a business agreement where they invest in property and divide the profits. The usual circumstance is that the financier provides the funds and pays the ongoing costs while the other project manages the entire project from start to finish. There are variances to the above and each JV is subject to the agreed position and responsibilities of each participant (ie the project manager may agree to pay for a certain percentage of ongoing costs). It is critical that all contingencies are covered in the JV agreement and that exit strategies are clear and unambiguous.
How to Register? Interested parties are invited to register by submitting their details in the applicable register below. For project managers, you must be a registered builder or have a development licence and have at least 5 years experience in the field of development. Financiers, you must be in a position to fund at least a $450 000 project which includes purchase costs, loan repayments for the property purchased, the construction loan and ongoing costs (such as rates, insurance, DA fees etc – examples of these are detailed in mini deals feasibility studies). Personal details will remain confidential and will only be known to staff at AIC. As financiers are footing the majority of the bill, AIC will present potential project managers to financiers and they will have the opportunity to choose which project manager they would like to liaise with to engage in a potential JV. In registering your details, you give AIC approval to do this. Once a financier and project manager have signed a JV agreement, AIC will take no further part in the venture. There is no registration fee for financiers, however, for project managers the fee is $30. AIC also charges a fee of 1% of purchase price for the property acquired in joining the financier with the project manager and providing information on JVs and the potential to use a mini deal with the JV.
Register