By Cyrus Mojdehi '19
On Friday, November 16th, 2018, 70 students from seven different graduate programs from Columbia, MIT, Harvard, and NYU gathered in Uris Hall to participate in the 7th annual "Coming to Terms: Negotiating Real Estate Joint Ventures" event. Co-sponsored by the Paul Milstein Center for Real Estate, the Grosvenor Group, the Columbia Graduate School of Architecture, Planning & Preservation, and The MIT Center for Real Estate, this gathering offered participants the unique opportunity to engage with and learn from experienced practitioners from both the legal, finance, and operational sides of the real estate industry.
Jennifer Morgan, Partner at King & Spalding and Adjunct Professor at Columbia Business School, and Tod McGrath '84, VP of Finance at Boston Properties and Lecturer at the MIT Center for Real Estate, opened the event with an introduction to typical characteristics of joint-venture agreements largely focused on four key areas: contributions, distributions, governance, and exit. Participants also discussed fairness in joint-venture agreements, as well as a review of Anthony’s Pier 4, Inc. v. HBC Associates, a landmark case regarding duty of care in partnerships.
Following the morning session, students broke out into small teams where they were either tasked with playing the role of the Managing Member (developer) or Investor Member (capital partner) in a mixed-use development based off an actual transaction. Students were advised in their groups by practicing attorneys from firms such as: Goodwin, DLA Piper, King & Spalding, Beacon Capital Partners, AIG Global Real Estate, Akerman, Boston Properties, and Goulston & Storrs. After several hours of preparation and review aided by advice from the attorneys, where participants analyzed the deal terms, JV structure, legal documents and devised our respective strategies, the teams went into breakout rooms for negotiation sessions. Judges from prominent real estate investment/asset management firms awaited students in the breakout rooms and offered constructive criticism and reviews of their overall performance. Students found this to be a fantastic opportunity to present in front of a blue-chip set of celebrity judges which included several Columbia Business School alumni and representatives from: Boston Properties, Dune Real Estate Partners, Grosvenor, Lazard, and Norges Bank Investment Management. The negotiations contained several impasses and sets of fireworks, however in the spirit of the event’s name, all teams were ultimately able to "come to terms."
Many thanks to Tod McGrath '84, Professor Jennifer Morgan, and the Paul Milstein Center team for spearheading the event, which will be running another iteration this spring in NYC.