What are the specific risks involved in a U.S. joint venture for a foreign institution?

While there are risks involved in entering into a joint venture, steps can be taken to mitigate the risk with due diligence and structuring. The most important thing is to trust your venture partner. Even though we can draft buy-sell rights or put rights, there is always dislocation and the risk of prolonged litigation. There are ways to search the history of a prospective partner, including payment of taxes, which i would certainly recommend. Another way of getting comfortable is to be introduced to the partner by a trusted third party. In any joint venture I set up, both entities must set up new entities to become venture members. The venture must have capital, which can be provided by the managing member or the general partner, or can consist of the equity in a new property which the venture owns. I address these issues on a case-by-case basis. A new entity should have two members, so a financial problem affecting one of the entities will not affect the viability of the new entity. Most parties use limited liability companies ("LLCs", which I would recommend for your investment), which, under the law, protect the members from personal liability. Unlike limited partnerships, the managing member has no fiduciary duty to the other venturer. A general partner, on the other hand, is liable for the acts of the venture and, under Delaware law, has a fiduciary duty to the other members. A fiduciary duty includes liability if the member takes advantage of a venture opportunity for itself. I can also build into the venture agreement rights to buy out the interests of the other venturer in the case of a failure to agree on a course of events over a period of time, the failure to perform obligations under the venture agreement, fraud or defalcation as well as other events that may be applicable. We can obtain additional protection if you purchase an interest in a property already owned by the co-venturer by obtaining a non-imputation endorsement from a reputable title insurance company. I always provide the non-managing party with significant voting approval rights. You may want the right to co-sign checks over a certain dollar threshold (if you have someone resident in the jurisdiction). There is insurance available for payroll obligations. If the other venturer is in charge of construction or significant alterations, we would get a guaranty of completion.
This is a very important and complicated subject, which I would appreciate the opportunity to discuss with you. I believe we can devise a structure that will provide sufficient protections to mitigate the risk of dealing with a third party. Furthermore, I am meeting with a developer in January who would like to connect with a platform like yours. You can contact me directly via my profile.