What is a real estate limited partnership?

A Real Estate Limited Partnership (RELP) is a legal structure in which one or more general partners (GPs) manage a real estate investment while limited partners (LPs) contribute capital and share in the profits without participating in day-to-day management.

Key Roles in a RELP

• General Partner (GP): Manages the investment, makes decisions, bears unlimited liability
• Limited Partner (LP): Provides capital, earns returns, limited liability (only equity at risk)
• Each party's rights and obligations are defined in the Limited Partnership Agreement (LPA)

How RELPs Are Structured

• GP typically invests 5%–10% of total equity
• LPs provide remaining 90%–95% of equity capital
• Returns distributed per the waterfall (capital return → preferred return → profit split)
• Fixed term (typically 5–10 years) with an exit or dissolution at the end

Real Estate Limited Partnerships democratize access to large-scale, high-quality property investments by pooling capital from multiple investors under professional management. In India, they primarily operate through SEBI-registered AIF structures and are an important vehicle for institutional and HNI real estate investment.