During challenging economic times, investors in real estate joint ventures need to be creative and flexible when considering strategies to preserve the viability of the venture and its projects. This is especially true when it comes to deciding if and how additional capital should be raised, if that becomes necessary to see the venture through difficulty.

Typically, a real estate joint venture raises capital through equity contributions by the venture members, debt financing provided by third-party lenders, or some combination of equity and debt. In a capital-constrained environment, obtaining additional third-party financing for a struggling real estate joint venture may be difficult, if not impossible. As a result, the joint venture members themselves may be the only feasible source of additional capital. However, the ability or willingness of the venture members to place additional capital at risk may vary. For example, it is not uncommon for the members to agree that addi