A real estate joint venture is a deal between multiple parties to operate together and put together resources to develop a real estate project. A lot of large projects are normally financed and developed as a result of real estate joint ventures.
Why would you even bother to think about joint venture? There are several reasons that would drive you think of looking for a joint venture Kenya opportunity. In this article, I want to take a look at ten possible reasons why you should have in mind joint venture for your next real estate project.
- Share Investment
Joint venture enables you to share an investment which with current financial strength would not have been possible. By just welcoming a joint venture partner, you possibly can find yourself sharing a massive investment proficient at unlocking multiple financial gains and for long term basis.
- Shared Expenses
Joint venture enables you to share construction expenses thus spreading the burden. Depending on the way the joint venture is structured, the load of expenses when shared tend to be lighter and far much manageable.
- Technical Expertise & Know How
Through a joint venture, you certainly will bring or connect with technically gifted and experience those people who are able to help you grow your knowledge. Not just real estate joint venture but even within other forms of joint ventures where companies or individuals team up for a specific venture. Certain times, some people are included in the deal owing to technical expertise in the subject matter.
- New Market Penetration
This is another reason why it makes sense to think of joint venture. Even if dealing in tangible products or offering a certain service, joint venture could be an easy route to entering a market or penetrating a market. Joint venture, you could get an entry into a market or obtain an existent market share and better it.
- New Revenue Streams
As a result of joint venture, an innovative revenue stream is opened. Joint venture financing will help you to get financing without
6. Enhanced credibility
Through a joint venture, you are able to build your credibility in the market as a person or company that can be trusted. Through that, you’ll be able to win more benefits which will result into mutual benefits.
7. Away to navigate past barriers to competition
One of the methods to go around a competitor and obtain a competitive hedge is a joint venture. Through a joint venture, you are able to achieve a larger market share and thus go ahead of a competitor. At the same time, you’ll be able to enter the market which competitor made difficult to enter.
8. mproved economies of scale
When two or more parties or companies join hand to do a project, their combined effort will yield greater production thus obtaining a higher level of economies of scale. This will translate into better profit margin for the venture.
For example, two companies can get started on a joint venture agreement for product distribution. Through such arrangement, Company A will now distribute its products alongside the products of Company B and vice versa.
9. Intellectual property gains
A joint venture arrangement gives birth to any kind of entity and with that an intellectual property is born. This is added value to do a joint venture because of the worth of the intellectual property gained.
10. Synergy benefits
When two or more people establish, the resulting effect is more than what individual could have been obtained. When you invite a joint venture funding partner, you are likely realizing a greater synergy in your work because of the combined resources and expertise.
There is more to gain in a joint venture arrangement. This does not mean that there are no challenges but certainly, when you take care of the potential areas of challenges, the gains are available for all to check. The trouble is where to acquire a joint venture partner?
Clique Joint Ventures (K) Ltd is a professionally managed joint venture deal sourcing company with network far and wide able to bring you a joint venture partner for your next project. With over ten years of experience brought in by top management, Clique Joint Ventures (K) Ltd is the place to pop in with your Joint venture needs.