Are you looking for a real estate joint venture(JV) partner in Ghana? Real estate joint venture partnerships have become a popular investment strategy in Ghana, offering both local and foreign investors a profitable way to participate in the rapidly growing real estate market in the country. Landowners are receptive to joint venture proposals from real estate developers. But before we move further let’s understand what the terms mean.

What Is Real Estate  Joint Venture Partnership?

As the terms sound, a real estate joint venture is a partnership between two or more parties to collaborate on a real estate project where each party has a role to play. I should say that there are all forms of JVs in any industry. In a typical real estate jv, each party contributes resources, such as capital, expertise, or property, to develop or invest in a specific real estate venture. All parties in the deal share the risks and rewards of a project. In Ghana, the common jv is the land owner contributing the land for the development and the development brings in capital and resources to execute the project.

Read also: Why are Homes Expensive in Ghana, West Africa?

How Is Real Estate Joint Venture Structured In Ghana,?

In Ghana, the market standard is 70/30 split. This means 70% of the units go to the development post-completion and 30% to the land owner, executed in a binding JV agreement.  Please note that this is not one cap fits all, every deal is different. You can always negotiate terms. The elephant in the room is, how does joint venture work in real estate? Let’s say for the sake of argument, the landowner let’s call him Kwame Bonsu has one acre of land for development at Spintex but has no capital to develop it. He partners with a local real estate developer, let’s call him/her the XX Homes. The developer together with his team of architects, engineers and quantity surveyors can put up a 50-unit apartment block on the subject land. After completion, XX Homes will retain 35 units and allocate the remaining 15 units to the land owner. At the end of the day, both parties use leverage to realize their dream.

Joint venture partnerships provide a win-win situation for both parties involved. The land owner can benefit from the capital, and gain knowledge and expertise that the developer brings to the table that he couldn’t otherwise have access to, while the developer gets land in the desirable location he wanted.

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Due Diligence

Both parties needed for both parties. Due diligence is essential when selecting a developer partner in Ghana. The landowner should conduct thorough research on the developer’s company registration, track record, and experience in the local real estate market to ensure that they are entering into a partnership with a reliable and competent partner.

In the same manner, the developer also needs to search the land. Everything in centered on the land. If there is any encumbrances on the land, the deal will go south. The developer must obtain the necessary documents such as the site plan, indenture, title certificate, and sublease agreement(if not from the chief or family). Do a thorough independent search at the lands commission. I say this because information available shows that some unscrupulous land owners pay lands commission staff to place their name on the land records to appear on search report. It is absurd, but believe it or not it is what it is.

Read also: 12 STEPS TO BUYING & REGISTERING YOUR FIRST LAND IN ACCRA

Joint venture Partnership with Fanada group 

Are you the land owner? Is your land registered? Is your land litigation-free? Have you run a search on your land in the last 3 months? Do you have all the documents handy? If yes to the above, contact us to discuss further about forming a JV partnership.

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Are you a foreigner considering investing in Ghana’s real estate market? Or are you African diaspora planning to buy your dream home in Accra, Ghana? We would love to connect and serve you. Buying your dream home in a new development project by a real estate developer gives you flexibility with regard to payment plans to choose from. You don’t have to go through all that stress to get building permits and regulations checked. We have done all the hard work.  Your only job is to own it by reserving your home now. Get in touch with us today, tomorrow might be too late.