Intellectual property in construction 2018

Know how to handle real estate transactions involving contaminated or potentially-contaminated properties. Many real estate transactions involve properties that have known or potentially unknown environmental contamination. Because of the strict liability imposed by environmental statutes it is important that real estate transactions be proceeded by appropriate due diligence and that the existence of any environmental contamination and associated liability be allocated in the Purchase and Sale Agreement or other applicable transaction documents (i.e., lease or financing documents).

Be prepared for problems that may arise during the real estate transaction process.This topic will explain how to preempt various issues during the negotiation and drafting phases, with an eye toward securing an optimal contract for one's client. It will also address the types of issues that surface as the transaction unfolds, whether during the due diligence phase or even at settlement, offering practical solutions and practice tips. Finally, it will cover litigation topics and cost-benefit strategies to assist you with delivering the most value-added legal services to your clients.

PEIs, together with mortgage loans and mezzanine loans, are often a critical part of the capital structure used by sponsors to fund real estate ventures. The terms of PEIs can vary considerably. On one end of the spectrum are PEIs that are economically and functionally equivalent to a mezzanine loan, though structured as equity and not debt. On the other end of the spectrum are PEIs that are pari passu with the sponsor's equity. In any context, a PEI's equity is subordinate to all of the real estate venture's debts. PEIs typically earn a higher rate of return on the investment than debt financing. They may earn a share of cash flow beyond a stated rate of return and any capital appreciation. The preferred equity investor generally has consent over "major decisions" (the list of which can range from a small handful of items to an extensive list), may have buy-sell rights, forced sale rights or put rights, and typically have removal rights (the right to remove the managing member or general partner of the real estate venture and replace it with the PEI or its designee). Removal rights can run the gamut from being limited to bad acts or being performance-based. To achieve all the benefits of PEIs and mitigate the risks, counsel to investors and the recipient entity must negotiate and structure key terms that address matters such as exit strategy, remedies in the event of the entity's default, issues surrounding a change in control, and the impact of an entity bankruptcy. Also, counsel must anticipate and address tax implications for the entity and the investor in the PEI agreement. Listen as our authoritative panel prepares counsel to real estate lenders, investors, and borrowers to structure, enforce, or challenge PEI agreements in the current real estate market. The panel will compare and contrast PEIs vs. mezzanine financing. The panel will also outline the key points of negotiation and agreement provisions for the equity investor and the real estate developer, including remedies for default, change in control, exit strategy, the impact of bankruptcy, and tax implications.

Jump-start your real estate investing education for 2019 with exclusive insight into Equity Trust clients’ self-directed real estate investments. Join Equity Trust Sales Manager, John Bowens, for this exclusive on-demand webinar to see newly released data on the types of real estate investments Equity Trust clients are making, where they’re investing, and more.