Real Estate Development Joint Venture Term Sheet for United Arab Emirates

Real Estate Development Joint Venture Term Sheet Template for United Arab Emirates

A preliminary agreement document governed by UAE law that outlines the key terms and conditions for a joint venture between parties engaging in a real estate development project. The document establishes the framework for the partnership, including ownership structure, capital contributions, profit sharing, and development responsibilities, while considering UAE-specific requirements such as foreign ownership restrictions, RERA regulations, and local municipality requirements. It serves as the foundation for the subsequent detailed joint venture agreement and development contracts.

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What is a Real Estate Development Joint Venture Term Sheet?

The Real Estate Development Joint Venture Term Sheet is a crucial preliminary document used in the UAE real estate sector when two or more parties intend to collaborate on a development project. It captures the essential commercial and legal terms that will form the basis of the full joint venture agreement, including ownership structure, capital contributions, development rights, and profit-sharing arrangements. The document must comply with UAE federal laws and relevant emirate-specific regulations, particularly regarding foreign ownership restrictions, property registration requirements, and development permits. This term sheet is typically used during the initial negotiation phase of major development projects and provides a roadmap for legal counsel to draft the detailed joint venture agreement. It is especially important in the UAE context where real estate development often involves complex partnerships between local and international entities.

What sections should be included in a Real Estate Development Joint Venture Term Sheet?

1. Parties: Identification of the JV partners, including full legal names, registration details, and addresses

2. Background: Context of the proposed development project and brief description of each party's expertise and role

3. Definitions: Key terms used throughout the term sheet

4. Project Description: Detailed description of the development project, including location, scale, and type of development

5. Joint Venture Structure: Proposed legal structure, ownership percentages, and governance framework

6. Capital Contributions: Details of initial and future capital contributions from each party, including land, cash, and other assets

7. Development Rights: Rights and responsibilities regarding the development of the property

8. Profit Sharing: Framework for distribution of profits and losses

9. Management Structure: Overview of management roles, decision-making processes, and voting rights

10. Key Milestones: Critical project timeline and development milestones

11. Regulatory Compliance: Key regulatory requirements and responsibility for obtaining necessary approvals

12. Confidentiality: Terms regarding confidential information and publicity

13. Exclusivity: Period and terms of exclusive negotiations

14. Binding Effect: Clarification of which terms are binding and non-binding

What sections are optional to include in a Real Estate Development Joint Venture Term Sheet?

1. Pre-Development Phase: Include when the project requires significant pre-development activities such as feasibility studies or land acquisition

2. Financing Structure: Include when external financing is contemplated as part of the development strategy

3. Exit Mechanisms: Include when parties want to address potential exit scenarios at the term sheet stage

4. Property Management: Include when the JV will also manage the completed development

5. Marketing Rights: Include when specific arrangements for marketing and sales need to be addressed early

6. Intellectual Property: Include when the development involves significant branding or IP elements

7. Environmental Considerations: Include when the project has significant environmental impacts or requirements

8. Force Majeure: Include when parties want to address major risk events at the term sheet stage

What schedules should be included in a Real Estate Development Joint Venture Term Sheet?

1. Schedule 1 - Property Details: Legal description of the development land, including title details and encumbrances

2. Schedule 2 - Initial Business Plan: High-level business plan including development concept and financial projections

3. Schedule 3 - Capital Contribution Schedule: Detailed breakdown of each party's capital contributions and timing

4. Schedule 4 - Project Timeline: Key dates and milestones for the development project

5. Schedule 5 - Required Approvals: List of required regulatory approvals and permits

6. Appendix A - Site Plans: Preliminary architectural plans and renderings

7. Appendix B - Financial Model Summary: Key assumptions and outputs from the financial model

8. Appendix C - Corporate Structure Chart: Proposed ownership and corporate structure diagram

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Real Estate

Construction

Infrastructure

Hospitality

Retail

Commercial Property

Residential Property

Mixed-use Development

Tourism

Industrial Development

Logistics

Urban Planning

Relevant Teams

Legal

Real Estate

Development

Investment

Finance

Commercial

Construction

Business Development

Strategy

Corporate Development

Mergers & Acquisitions

Project Management

Risk Management

Relevant Roles

Chief Executive Officer

Chief Investment Officer

Development Director

Real Estate Director

Head of Legal

Project Director

Investment Manager

Commercial Director

Joint Venture Manager

Business Development Director

Chief Financial Officer

Construction Director

General Counsel

Senior Legal Counsel

Development Manager

Real Estate Investment Manager

Head of Real Estate

Managing Director

Partnership Director

Industries
UAE Federal Law No. 32 of 2021 (Commercial Companies Law): Governs the establishment and operation of commercial companies in the UAE, including joint venture structures and foreign ownership requirements
UAE Civil Code (Federal Law No. 5 of 1985): Contains fundamental provisions regarding contracts, property rights, and obligations between parties
UAE Federal Decree-Law No. 33 of 2021: Regulates commercial agencies and their operations in the UAE, relevant for certain joint venture structures
Law No. 7 of 2006 (Dubai Property Registration Law): Regulates real estate registration procedures and property ownership in Dubai, crucial for development projects
Law No. 3 of 2015 (Dubai Real Estate Regulatory Agency Law): Regulates real estate development, including off-plan sales and developer obligations in Dubai
Law No. 13 of 2008 (Dubai Real Estate Regulatory Law): Regulates the interim real estate register and development requirements in Dubai
UAE Federal Law No. 18 of 2017 (Anti-Money Laundering Law): Relevant for real estate transactions and partner due diligence requirements
UAE Environmental Law (Federal Law No. 24 of 1999): Contains provisions relevant to construction and development projects' environmental impact
UAE Labor Law (Federal Decree-Law No. 33 of 2021): Relevant for employment aspects of the development project and contractor relationships
Municipality Building Codes and Regulations: Local technical requirements and specifications for construction and development projects
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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