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JV Res-Dev of 1/2acre block. Novice, need help please, many thanks.

Discussion in 'Development' started by LoanSharkJR, 25th Jul, 2016.

  1. LoanSharkJR

    LoanSharkJR Active Member

    Joined:
    22nd Jul, 2016
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    Location:
    Wonthaggi
    My father has a 1/2 acre block in Croydon, VIC that he would like to develop, and keep two units for himself.

    The block would be worth in excess of $1m, however he is a self-funded retiree with no capacity to borrow funds to do it all himself.

    I am asking for suggestions and avenues to explore to help his dream realise.

    A Joint Venture is one suggestion I have been offered but I have no idea where to start or who to trust.

    All comments welcome.
    Thank you
     
  2. sanj

    sanj Well-Known Member

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    has he got much experience in the area? just asking because that will affect whether you need a partner just for funding or expertise as well.

    I don't know the area or the zoning but is it possible for him to subdivide into 2 lots; sell off the largest block you can while still retaining the ability to build 2 on the retained block and then use the proceeds of sale to build those 2 units?
     
  3. sanj

    sanj Well-Known Member

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    joint ventures cab absolutely work but ive also seen people without the experience or expertise to identify risks properly or structure the deal correctly get burnt and in retirement the last thing you want is to take large risks.

    is the property held inside or outside of super?



    if outside you may get a better result flogging this off, chucking proceeds into super assuming elegibility and allocating funds to higher yielding investment/s anyway
     
    mrdobalina likes this.
  4. Phase2

    Phase2 Well-Known Member

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    The OP's post doesn't give the full context of the OP's fathers position.. there was another on Friday that laid it out. "Help my father in retirement"

    Basically, the property is owned outright in the father's name. Father doesn't have the skills or experience to develop, or the knowledge to handle a JV development (so needs good technical, legal and accounting advice).

    Father has sentimental ties to the property, and doesn't just want to sell it off, even though this would be the easiest option for him and his family. There is a similar block with DA in Croyden with 7 units approved selling for $1.5M+. No idea what OP's father's property is like though.
     
  5. sanj

    sanj Well-Known Member

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    ah ok didn't realise it was same OP.

    Yeah no funds or experience plus sentimental ties clouding judgement and on top of that being in retirement where risks have to be minimised = a hell of a lot of barriers to making this a success. then you add in the complications of partnering with an outside party...

    not impossible but a lot to consider and Manager to get the job done correctly and profitably.
     
    Phase2 likes this.
  6. pinkboy

    pinkboy Well-Known Member Premium Member

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    Mackay, Qld
    • Get over the emotional ties.
    • Sell block for over $1mil
    • Dump the $1mil into good quality, franked shares, LICs, ETFs.
    • Live happily ever after on $100,000pa
    No stress, no JV partner, no experience required.

    pinkboy
     
    sanj and mcarthur like this.