All Topics / Commercial Property / Joint Purchase

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  • Profile photo of Ross.PoulterRoss.Poulter
    Member
    @ross.poulter
    Join Date: 2012
    Post Count: 19
    January 18, 2013 - 12:15 pm

    Hi all,

    I am looking at purchasing an industrial property with 2 other people.

    What is the best structure for this purchase, I was thinking a unit trust?

    We have discussed and agreed on the funding arrangements and an exit strategy.

    What else should we ensure we all agree on?

    Any words of wisdom on the above would be greatly appreciated.

    Thanks,

    Ross

    Profile photo of RPIRPI
    Participant
    @rpi
    Join Date: 2012
    Post Count: 308
    January 18, 2013 - 12:33 pm

    Hi Ross

    There are multiple possible structures, the state the property is in will affect choice of structure also but a Unit Trust is often a good vehicle in these situations.

    If a Unit Trust does turn out to suit best, I would strongly recommend a Unit Purchase Agreement, this is an agreement signed by all the parties and outlines all of the what if's and how to's for when issues arise.  There are various other versions for other structures.

    Again, depending on the state, it may prove beneficial for the units to be purchased by discretionary trusts.  Land tax can be a big influence on this decision, especially if property is in NSW.

    regards 

    D

    RPI | Certus Legal Group / PRO Town Planners
    http://www.certuslegal.com.au
    Email Me | Phone Me

    Property Lawyer & Town Planner

    Profile photo of Ross.PoulterRoss.Poulter
    Member
    @ross.poulter
    Join Date: 2012
    Post Count: 19
    January 18, 2013 - 12:56 pm

    Hi D,

    thanks for the advice.

    The property is to be constructed in Pakenham, Victoria

    My share of the units will be purchased through my discretionary trust.

    Are the units in unit trust a predesignated value? or can you name the value on them?

    If so would it be best to call one unit $1?

    Thanks,

    Ross

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    January 19, 2013 - 12:08 am

    Units woud reflect the value of the property owned by the trustee.

    Think also about

    bankruptcy

    death

    incapacity

    liability

    caveats

    power of attorney

    family law disputes

    etc

    What would happen if, mid project, the spouse of one unit holder lodged a caveat on title under a family law dispute for example

    What if one unit holder ended up in an accident and in a coma unable to sign.

    What if 2 refuse to pay the loan.

    Who will guarantee the loan? Who will control the trustee?What if 2 gang on on the one?

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

Viewing 4 posts - 1 through 4 (of 4 total)

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