06/02/2022
*PROPERTIES BULLETIN*
Present........
*SECRET OF WEALTHY IN REAL ESTATE*
AS A LAND OWNER, THIS IS WHAT YOU SHOULD DO TO MAKE MORE MONEY FROM YOUR LAND.
You have a land. Yes, you reading this.
You bought it, say 8 years ago at 15 million naira.
Now the land is valued at 81 million naira, or more.
You're tempted to sell off.
But hey! What if I tell you that there's a way to go about it so you can earn way more than that?
You can actually make, say 500M from that same land.
"Ah dunt belivit!" you say?
Well, here's how.
👉 Joint Venture (JV)
Let me assume you don't know what joint venture is in the real estate sector.
So, I'd break it down for you.
joint venture (JV) in the real estate sector is essentially a partnership of builders, finance houses and developers. They partner with each other, to develop specific real estate projects.
For example, a JV may be created when one party has the land — but needs another party to come in and develop it.
Let me break it down further, such that even a kid will understand.
You the land owner (X) with a plot of residential land measuring 4600 square meters in, say Asokoro, Abuja.
Let's assume that the market value for the land presently is 850M.
But
You decided to go for a joint venture (JV)
The land is now marketed as a joint venture land, and the goal is to get a credible and reliable developer to partner with.
What you're bringing to the table is your land. That's all.
What the developer is bringing to the table is their expertise and funds.
Usually, different developers will show interest in partnering with you, but you don't want to partner with just any developer. You want one that is capable, and credible. Very important.
These developers usually send in their letter of interest (LOI), proposal, which gives a detailed break down of the number of houses to be built, the amenities, the projected expenses for the project, and the projected profit to be made when the project is done. Also, they state the duration the project is expected to be completed.
They also send in their company profile, which shows their previous or ongoing projects. Also, the structure and leadership of the company, and the necessary documents such as tax clearance, CAC papers, etc.
Now, in joint venture, there's an agreed sharing formula, usually 60/40.
Let's say the land owner and the developer agrees that 60% to the developer, while 40% goes to the land owner.
E. G. Developer A says they'd build 20 units of terrace duplexes on the land, to be sold at 250m when completed. Calculate 250m X 20. You as a land owner will be taking 40% of that amount.
Let's say developer B says he'd build 18 units of fully detached duplexes, to be sold at 400m per unit when completed. Calculate 400m X 18. You as a land owner will be taking 40% of the amount.
Now, you as a land owner, you go through numerous proposals from different developers and go with the one that appeals to you the most.
Well, you don't just look at the amount you stand to gain when the project is done.
You also look at factors such as the duration each developer gives. You look at their previous projects, and reputation, of course.
Now, would you rather sell your 4600sqm plot of land at 850M or enter into a joint venture with a credible developer and make X10 the amount?
You don't have to answer me. 😁
TERMINOLOGIES IN JOINT VENTURE (JV)
1. Premium. It is an amount requested by the land owner to be paid upfront by the developer to guarantee his commitment in the JV deal before commencement of the project.
This premium is not FREE; it is usually deducted from the total profit made from the sales of the property before sharing the profit.
2. Facilitators. These are people from both the developer and land owner who made it possible for the JV deal to go through. They are usually paid 10% of the land value, to be shared among them, as many as they may be.
3. Facilitators fee. It is usually 10% of the land value. 5% from the land owner, and 5% from the developer, making it 10%.
However, the developer usually pays their 5% and that of the land owner, to be deducted when sharing the profit.
Check this out.
You have a plot of land in Wuye whose market value is 120M.
You can sell it off and collect 120m.
Or
Get a credible developer and partner with them.
They build 10 units of 4 bedroom terrace duplexes on it.
They sell a unit at 100m.
That's 1 billion naira.
40% of 1 billion naira is what again 🤔
Exactly. That's how much you'd make, against the initial 120m.
Contact
*Mas Properties Ltd*
07035154441,08106334002,08110497201,
today on the above lines to help you get lands and investors nation wide.
Always at your service.
