Suggestions On Structuring Development Project
Howdy everyone.
I'm looking for a little advice before I sit down with my attorney.
Project: Buying existing duplex on wide lot. New homes in the area are going for $450,000-$750,000. Before closing, I plan on getting permission from the city to subdivide. Assuming that goes through, I will then tear down (or possibly move) the existing duplex, then build two new SFHs. I will be partnering with my builder on the project.
Question 1: How should this be structured? I am assuming that the property will be purchased through a partnership (or LLC). My share of the partnership will be held in a separate LLC and his will be held by whatever entity he so chooses. Is there a better way to do this?
Question 2: The construction will then be contracted through his company at his actual cost. What kind of safeguards can I put in here so that I can a) fire his company if not performing to expectation, and b) pay for additional costs of having another firm complete the job out of his share of the partnership. I've worked with him before and I trust him, but business is business.
Question 3: I have been considering using a precast basement foundation with a garage in the basement, however my builder raised a concern with fumes when putting a garage and living space in the basement. Does anyone know of any code or health issues with this? I just thought it would be less expensive to do it this way than to build a detached garage. At this point, I'll probably do a detached garage anyway, but I thought I'd throw this out there and get opinions.
Thanks,
Spencer
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