JV Equity Converting to Preferred Equity During a Development Deal
Has any one ever structured a development deal where the JV equity partner (LP) has the option to convert to a preferred equity structure? I've been starting to see this structure socialized on master planned communities / large industrial phased deals and wanted to see if any one has had experience working on this deal structure and the mechanics behind it. In shorty summary, it is basically just offering the LP significant downside protection if leasing is stagnant, pro forma rents are not being achieved, construction delays, etc. Obviously there is a period of time for the LP to execute this option and I'd imagine that there could be some hurdles with getting the construction lender comfortable with this structure.
Interested in hearing feedback on this.
Ex beatae velit voluptatem quis labore. Consectetur aperiam repudiandae reprehenderit et veniam deserunt.
Est aliquam fugit voluptate nisi. Pariatur et quia enim iusto voluptatem.
Quidem illo at nam. Sed doloribus eos reiciendis libero quia aliquam facilis. Natus laborum totam libero ducimus debitis odit. Praesentium molestiae adipisci dicta velit a deserunt sed. Fugit ex enim commodi eveniet veniam. Voluptas eligendi magnam non quis maxime.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...