splitting profit interest among vertically integrated sponsor team?

Working on assembling my first real estate development deal. I'm coming at it from an architecture and urban planning background. I'm acting as the project manager/lead and I've assembled a team of partners with general contracting experience and property management experience. In addition to sponsoring the deal, we are self performing the general contracting, and the property management. I'd like to get reimbursed for our expenses in cash, including a reasonable valuation fo my team's time and business operating overhead, but would like to structure the deal such that our profit is realized through the profit interest in the project with a simple waterfall structure. The question we are facing is this: how to spilt the profit interest among our partners? The relative value of the development fee vs the general contracting fee vs the on-going property an asset management fees? In addition, our design team is contributing their profit margin as equity (about 20% of the total design fee). Is a 25% share to each of those four roles/responsibilities appropriate? (Maybe also worth mentioning that we are asking our investors to provide a limited guarantee, and we are offering a guarantor fee to acknowledge/compensate that risk.) Thanks in advance for any insight/feedback!

 

Dicta quas ea nulla debitis accusamus. Similique quo ut ipsum doloremque voluptas architecto inventore. Repellat officia aut quia eos rerum ut.

Facere quam et vitae nam est ut inventore. In sit aut nihil ut explicabo consequatur. Et assumenda ea non qui saepe quo et et. Quis facilis nulla ipsum excepturi et repellendus. Et maiores recusandae tenetur ea fugiat voluptatum. Accusantium accusamus quae est consequatur possimus quam consequatur dolorum.

Qui consectetur quo debitis ipsa temporibus esse. Incidunt nam laudantium earum ut ab. Repellat est fugiat veritatis. Voluptas aut voluptatem neque qui non pariatur aut dignissimos.

I'm an AI bot trained on the most helpful WSO content across 17+ years.

Career Advancement Opportunities

May 2024 Investment Banking

  • Jefferies & Company 02 99.4%
  • Lazard Freres No 98.8%
  • Goldman Sachs 18 98.3%
  • Harris Williams & Co. New 97.7%
  • JPMorgan Chase 04 97.1%

Overall Employee Satisfaction

May 2024 Investment Banking

  • Harris Williams & Co. 18 99.4%
  • JPMorgan Chase 10 98.8%
  • Lazard Freres 05 98.3%
  • Morgan Stanley 07 97.7%
  • William Blair 03 97.1%

Professional Growth Opportunities

May 2024 Investment Banking

  • Lazard Freres 01 99.4%
  • Jefferies & Company 02 98.8%
  • Goldman Sachs 17 98.3%
  • Moelis & Company 07 97.7%
  • JPMorgan Chase 05 97.1%

Total Avg Compensation

May 2024 Investment Banking

  • Director/MD (5) $648
  • Vice President (20) $385
  • Associates (90) $259
  • 3rd+ Year Analyst (14) $181
  • Intern/Summer Associate (33) $170
  • 2nd Year Analyst (67) $168
  • 1st Year Analyst (205) $159
  • Intern/Summer Analyst (146) $101
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

Leaderboard

1
redever's picture
redever
99.2
2
Secyh62's picture
Secyh62
99.0
3
Betsy Massar's picture
Betsy Massar
99.0
4
BankonBanking's picture
BankonBanking
99.0
5
GameTheory's picture
GameTheory
98.9
6
CompBanker's picture
CompBanker
98.9
7
kanon's picture
kanon
98.9
8
dosk17's picture
dosk17
98.9
9
DrApeman's picture
DrApeman
98.8
10
bolo up's picture
bolo up
98.8
success
From 10 rejections to 1 dream investment banking internship

“... I believe it was the single biggest reason why I ended up with an offer...”