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  • Entrepreneurs

    SPV Shareholders

    Hi all,

    I am looking to invest in property with friends, 8 of us in total. We will all be equal shareholders/directors of an SPV limited company, all investing the same sum of money.

    Does anyone have any experience structuring the ownership in this way? - are the any roadblocks to look out for, any hidden fees etc?

    Thanks in advance.

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    Hi Max,

    What you are proposing is quite risky on two levels:

    1.  Mixing business and friendship often does not have a happy ending.

    2.  Financially associating yourself with other people can impact negatively on you, if things do not go to plan.

    Please forgive me if you have considered the above and accepted those risks.

    These threads are a good starting point:

    How to stay safe lending money & property JVs

    Joint Ventures - structures & pitfalls 

    A good legal agreement to protect you all will cost somewhere in the region of £2 to £4K to set up, but its vital.

    ​Hope that helps for starters?


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    If you are looking at a cash purchase it will be much simpler.

    If you are looking to obtain finance, it starts to get very difficult. With most mortgage lenders having a cap on 4 maximum applicants. It raises a question about who of the 8, or all have to provide Personal Guarantees.
    Now if you are looking to obtain finance too, the team at Bespoke Finance would love the challenge on 08009202001 or hello@bespokefinance.info

    8 People are a lot of variables. I would certainly recommend you have some form of contract between you all.
    Outlining rights and responsibilities. The company structure is great for this but it's not really explicit.
    You want to avoid conflict as much as possible, a friendship can quickly end when complicated with business.

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    _________________________________________________________________________


    My posts are not financial advice, just a rambling guy passing time on a coffee break.
    The team at Bespoke Finance offers advice, including Limited Company Buy-to-Let , HMO Conversion and Cheap Life Insurance.

    _________________________________________________________________________