Corporate Structure
Each Strongbox project will have a corporate structure similar to the example below. There will be three entities formed to complete a project, one for its cash investors, one for the project operating business, and one for the manager entity. The example below shows the structure and the roles for each of these entities for the recent Strongbox Myers Warehouse project.
Myers Manager LLC is the manager entity for Myers Preferred Members LLC and for Myers Warehouse LLC. Its roll is to provide development management service and to be paid fees and profits from the Myers Warehouse project. These fees and profit splits are defined in the Myers Warehouse LLC operating agreement.
Myers Preferred Members LLC is an entity created to capitalize the Myers Warehouse LLC. Its roll is to raise the equity capital for the project and to provide corporate divide between the investor held LLC and the project LLC, limiting liability for investors. This entity is the sole owner of the preferred interest in Myers Warehouse LLC.
Myers Warehouse LLC is the operating entity that receives the equity investment from Myers Preferred Members LLC. This entity holds title to the real estate asset. Its role is to execute the development project and to design, permit, build and lease or sell the project. This entity pays a share of the project profits and management fees to Myers Manager and also pays a share of profits and return of invested capital to Myers Preferred Members LLC. This entity’s operating agreement outlines the waterfall profit split structure for sharing profits between the preferred member and the common member interests.
