Using LLCs for Succession Planning

New York Real Estate Journal recently published an article written by Olshan Real Estate partner Thomas Kearns entitled “Using LLCs for Succession Planning.” In the article, Mr. Kearns discusses how real estate operators can use LLCs to comply with the restrictions on control imposed by mortgages and equity partners. Using the LLC structure to hold the operator's interest avoids the need to formally substitute a new manager should the current manager become unable to carry on while also limiting the manager’s exposure to personal liability. An additional benefit is that the manager may incorporate other investors and share any profits or fees from the deal.