C04 · Capital & transactions
Joint venture and joint development agreement advisory
Joint ventures are agreed when both parties are optimistic and tested when one of them is not. Almost every dispute we are asked to look at traces back to a provision that was left vague because raising it felt unnecessary at signing.
- Structures
- JDA, area share, revenue share, SPV JV
- Focus
- Governance, default, deadlock, exit
- Advises
- Landowners or developers, one side
- Works with
- The party's own counsel
Joint Venture & JDA Advisory, in brief
Joint venture and JDA advisory covers the structuring and negotiation of a partnership between a landowner and a developer, or between co-investing developers: choosing the partner, deciding between revenue share and area share, setting governance and control rights, and drafting the default, delay and deadlock provisions that determine what happens when the project underperforms.
Area share and revenue share are not interchangeable
Landowners are frequently offered a choice between a share of constructed area and a share of revenue, and the two allocate risk very differently.
An area share gives the owner physical units — they carry sales risk and market timing risk, but they also capture upside if prices rise, and they are not dependent on the developer's pricing decisions or accounting. A revenue share gives the owner cash as the project sells, which is simpler, but makes them dependent on the developer's pricing, discounting and reporting discipline for years.
Which is better depends on whether the owner has the capacity and appetite to sell units themselves, and on how much they trust the developer's price discipline.
| Structure | Owner's exposure | The provision that matters most |
|---|---|---|
| Area share | Sales and market-timing risk on their own units | Which specific units, on which floors, with what specification |
| Revenue share | Dependent on developer's pricing and discounting | Definition of revenue, discount authority, audit rights |
| Fixed consideration + share | Partly de-risked, capped upside | Payment security and the trigger for each tranche |
| SPV joint venture | Full development exposure, plus governance | Reserved matters, capital-call and deadlock mechanics |
| Development management | Owner retains risk, buys execution | Fee structure, performance standards, termination rights |
The provisions that decide the outcome
In a smooth project, the share ratio is the only term anyone remembers. In a difficult one, a handful of other provisions determine who bears the cost of the difficulty.
- What constitutes revenue, and whether discounts reduce the owner's share
- Audit and information rights, and how frequently they can be exercised
- Milestone covenants with consequences, not just dates
- What happens on developer default, insolvency or change of control
- Deadlock resolution that does not require litigation
- Transfer restrictions: who the owner might find themselves partnered with
- Security over the developer's share, and whether it is perfected
Partner selection is the first and largest decision
No set of provisions rescues a partnership with the wrong counterparty. A developer without the balance sheet to complete, or with a pattern of extended delays and disputed settlements, will produce a bad outcome under any agreement — the provisions merely determine how long and expensive the recovery is.
We do capability diligence before structure: completed projects, delivery timelines actually achieved, current commitments against current capacity, litigation history and how past partnerships ended. That last item is the most informative and the least often checked.
Scope
What the engagement covers.
- 01Structure selection: JDA, area share, revenue share, SPV
- 02Partner identification and capability due diligence
- 03Share ratio modelling and negotiation
- 04Governance and control rights design
- 05Approval, milestone and timeline covenants
- 06Default, delay and deadlock provisions
- 07Security and guarantee structuring
- 08Exit and transfer rights
- 09Commercial review of documentation
- 10Ongoing monitoring against the agreement
Deliverables
What you receive.
Structure comparison
Area share, revenue share, hybrid and SPV modelled against the owner's liquidity, risk appetite and capability to sell.
Partner due diligence
Balance sheet, delivery record against committed timelines, current capacity, litigation position and how prior partnerships ended.
Share ratio model
Ratio analysis against residual land value and comparable transactions, with the negotiation range and floor stated.
Term sheet and commercial review
Governance, covenants, default, deadlock, security and exit provisions reviewed commercially alongside the party's counsel.
Monitoring framework
What to track against the agreement, at what frequency, with the triggers for exercising rights identified in advance.
Method
How we run it.
Four stages, each with a defined output. Nothing proceeds on momentum.
- 01
Choose the structure
Area, revenue, hybrid or SPV, decided against the owner's actual capability and risk appetite.
- 02
Diligence the partner
Capacity, delivery record and how their previous partnerships ended — before terms are discussed.
- 03
Negotiate the protections
Governance, covenants, default, deadlock, security and exit — the provisions that matter when the project is late.
- 04
Monitor the agreement
Track performance against covenants and exercise rights on the triggers agreed in advance.
Outcomes
What changes.
- A structure chosen against real capability, not the more flattering offer
- Partner diligence that includes how prior partnerships ended
- Revenue defined so discounting does not silently shift cost
- Deadlock resolvable without litigation
- Security over the developer's share, perfected
Questions
Joint Venture & JDA Advisory: frequently asked.
Is area share or revenue share better for a landowner?
Area share suits an owner willing and able to carry sales risk on their own units, and it captures upside if prices rise. Revenue share is simpler but makes the owner dependent on the developer's pricing, discounting and reporting for years. The choice should follow the owner's capability and their confidence in the developer's price discipline.
What share should a landowner expect in a JDA?
There is no standard ratio. It is a function of land value relative to total development cost, the entitlement position, who funds approvals and construction, and the catchment's realisation. Any ratio quoted before a residual analysis is a negotiating position rather than a benchmark.
Do you draft the agreement?
No. Drafting is for the party's solicitor. We advise on structure and commercial terms, negotiate them, and review the draft commercially — specifically looking at the provisions that govern delay, default and deadlock, which are where commercial and legal review most need to meet.
Related capabilities
- Land AdvisorySite identification, aggregation, title and entitlement assessment, valuation and monetisation — on both the buy and sell side.
- Capital & Partnership AdvisoryCapital structure, partner identification and term sheet negotiation — sized to a launch plan the market has validated.
- Redevelopment StrategyIndependent advisory on redevelopment — entitlement, corpus, developer selection and consent — for societies and for developers.
- Development AdvisoryScheme optimisation against demand: mix, efficiency, entitlement, phasing and cost-value engineering — before the plans are frozen.
- Transaction ManagementCoordination of diligence, conditions, advisers and documentation so a signed deal actually completes.
- Property StrategyThe option appraisal that comes before commitment: hold, develop, monetise, partner or wait — argued on evidence.
Joint Venture & JDA Advisory
Bring us the decision, not the deadline.
The earlier we are involved, the more value there is to protect. Tell us where the project stands and we will tell you what we think.