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How Do I Form a Joint Venture for Construction?

By Erin J. Hill
Updated May 17, 2024
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In order to form a joint venture for construction, you will first need to find a company to work with. Once you have done this, you will need to speak with a licensed attorney in order to handle all aspects of the project or projects involved with the venture. A joint venture may span the length of one project, or you may work with the partner company for longer periods of time. These aspects of forming your partnership should be decided upon before getting started.

The first step in forming a joint venture for construction is to find a company that you think would make a good partner. Many ventures are started in an attempt to allow both parties to offer services together that each one could not offer alone. For instance, if you are a professional flooring installer, you may begin a joint venture for construction with an interior carpenter in order to offer both services to your own clients. You may also partner with another business to combine funds and other assets to take on a larger project, such as development of new residential construction or commercial properties.

Generally you will speak with the decisions makers within the company you want to form a joint venture with and give them your proposal for business. When doing this, you should focus on the benefits the other business may obtain from joining forces with you. Likewise, make sure the business you are approaching would be beneficial for you to partner with as well. When you are both in agreement in terms of the responsibilities and obligations both parties will take on, it is time to seek out a licensed attorney to handle the legal aspects of forming a joint venture for construction.

Forming a joint venture is not as complicated a task as merger, since both companies or contractors will remain as separate entities. They may form a third title or name in order to conduct business jointly, but both existing businesses also remain and are able to conduct business outside of the venture. Both parties will need to decide which types of projects will be handled jointly, which expenses will be shared and handled by each business, and how long the venture will last. Some joint ventures last only for the duration of a project, while others continue through several projects.

The attorney will help you form a joint venture for construction by writing out an official agreement between yourself and the other business owner or decision makers. It will outline the conditions of your venture to ensure that you are all in agreement, helping you avoid any confusion or conflicts in the future.

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