Do you need a new LLC for your San Diego real estate venture? Why is the LLC a solid consideration for any new real estate entity?

San Diego real estate business entities that used to be limited liability partnerships are now simply formed as LLCs.  Limited Liability partnerships exposed partners to a broad range of legal and financial responsibility for the actions of others.  This allowed third parties such as creditors to pursue one partner for the debts or obligations of another partner within the company.  This is why you should consider a new LLC for your San Diego real estate venture.

The protections provided by the limited liability corporation (LLC) to the various “members” (read: partners) are quite extensive, and an LLC is actually much more functional as an entity than it’s predecessor.  The “operating agreement” establishes the responsibilities of each member, the contributions required of them and how expenses are to be borne.  It also defines the distribution of profits as well as what will happen if a major life event (such as divorce, death, incapacitation) occurs.

At the Watkins Firm, we’ve structured thousands of LLCs, and managed the negotiation, creation and execution of even more real estate contracts and transactions involving the sale or purchase of commercial property, development, renovation and commercial leases.  San Diego real estate contracts are quite complex and each party should have their own attorney who can help to protect their best interests.

Pro-Tip: “Everyone thinking about going into business or in business, you should do what most successful business people do, and that is get a relationship with your lawyer. So you’re doing everything the best way, not just legally, but from a an experienced perspective.

I’ve had 10,000 new business clients like you and the successful ones did it this way. From your banker, making sure your access to funds is correct and accounted for and, and a good accountant or CPA, not just a tax person, an accountant or CPA that gives you business advice on making a profit. Those are the things you think about. And then you come to your lawyer who talks about the best way for you to go based on your profession and universal things you should have and special things just for you based on your own personal life and your own investment.

The company documents are most important to discuss with your business formation attorney.  If you choose a corporation, not all corporations are the same. If you choose a limited liability company, if you choose a partnership, a limited liability partnership, there’s all types of different variations. And then you can get into the nitty gritty based on your profession and all the regs and all the professional license requirements and all of the, depending on the kind of company, their resale license and permits. There’s all kinds of little things that your old business lawyer knows about and can tell you about from the get go. As opposed to you finding out after you’ve made a few mistakes.

You’re giving birth to a living creature that’s been recognized by the United States Supreme Court. And so what it means is birth is what we call capitalizing. And so you have these corporate documents and you have to decide on how much ownership will be and who owns what. Then you decide about what potential ownership there are. Reserve shares, I mean other ways in which people can own it. And then you capitalize it. Either you capitalize it with cash or you capitalize it with goodwill or a combination or a property. But how you capitalize it can determine whether or not it’s a real company or you have all those protections of corporate veil and creditors and you’re personally shielded. So how you start it is very important. And thinking about it, we’ll send you on the right path to avoiding all kinds of pitfalls and trouble.” – Dan Watkins, Founding Partner

Are you searching for information on forming a new LLC for your San Diego real estate venture? The proven experience of Watkins Firm attorneys assures that the legal work is done efficiently and accurately.  We will share our decades of experience in real estate transactions just like the one you are working on.  We can share where the pitfalls and real risks lie, and how to protect your position while maximizing the return on your investment.  We invite you to review our podcast Episode 34 – Business Formation as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.