“Shoulda, Coulda, Woulda.”
Two of our clients at RMLO Law LLP decided to do a Joint Venture on an apartment building in Edmonton. The ‘real estate expert’ client had a lot of experience and already owned a number of apartment buildings in Alberta—all running very successfully. The ‘money partner’ client was relatively new to the real estate business. Projections were made, some data exchanged, and the Joint Venture went ahead.
Unfortunately, this particular apartment building did not work out nearly as well as the other apartment buildings already owned by our ‘real estate expert.’ Once things were not going according to expectations, both clients were unhappy with each other.
Our ‘money partner’ felt that the ‘real estate expert’ had not provided adequate information, was not managing properly, gave unrealistic expectations or projections, and, in general, was not living up to their end of the joint venture.
Our ‘real estate expert’ felt that the ‘money partner’ was misinterpreting verbal statements, had unrealistic hopes based on nothing firm, and, in general, was expecting perfection where that was never promised.
Our clients ‘shoulda’:
- Started with complete due diligence on not only the property, but also each other
- Had open honest communication about the potential positive and negative aspects of real estate investment
- Reported or requested information clearly and on a timely basis
Then, they ‘coulda’:
- Had a solid Joint Venture plan with formal written documentation
- Been proactive in dealing with any issues that may have arisen
After that, our clients ‘woulda’:
- Ended up with a more successful Joint Venture
The moral of the story is:
“don’t be a spectator in your own deal.”
If you’re doing a Joint Venture real estate deal in Alberta, get in touch with Barry. Having the right lawyer can make all the difference!