Posted by Sean on July 29, 2003 at 08:12:31:
Thank you very much for your thoughts.
A provision for “prior to 5 years period” was not something I came up. By making it unilateral agreement (ensuring that they will not exit at least for 5 years, I can buy back their shares within 7 years at no extra, and I can ‘kick’ them out by paying for 5 years of interest), it is actually favors my goal.
I intend to enjoy its capital gain thus would like to hold more than 5-7 years. My object is to get 100% ownership within 7 years.
As for the cash reserve, I will build into the Agreemtn. However, what is the general rule of such cash reserve when it comes to apartment buildings? I am only interested in less than 20 years old building. I also have relatives who owns architectural firm and general construction business. Therefore, I can easily make all expenses extremely low.
What I encounter is that the investors want both CF and preferred return on investment, not interested in CG at all. It sounds just like a “growth fund” to me.