A limited liability company (LLC) is a business entity that combines the liability protection of a corporation with the tax flexibility of a partnership, and it is the preferred legal structure for holding co-owned real estate.
In fractional ownership, placing a property inside an LLC protects each owner from personal liability related to the property. If someone is injured at the home or a legal dispute arises, the LLC shields the owners' personal assets. The LLC also simplifies ownership transfers, since selling your share means transferring your membership interest rather than executing a new deed, and it provides a clear framework for decision-making through its operating agreement.
GoForth, a luxury co-ownership company, creates a dedicated LLC for every property in its portfolio, with each of the four co-owning families holding a quarter membership interest. The operating agreement spells out everything from usage schedules and expense sharing to exit procedures, including GoForth's buyback guarantee. This structure gives owners legal protection, operational clarity, and a clean path to selling their share when the time comes.