Governance
How Luxara is governed.
The structure in 60 seconds
Each Luxara property is held in its own Canadian Limited Partnership. Investors purchase LP units representing deeded equity. A General Partner (GP) entity controlled by Luxara manages day-to-day operations. The structure is identical to how institutional real estate investors hold property: clear lines of authority, limited investor liability, flow-through tax treatment.
This page explains the seven things every prospective investor should understand before subscribing.
Who manages the property
A General Partner entity (Luxara Management GP) is the sole manager of each LP that owns a property. Limited Partners (you, the investor) hold non-voting LP units representing economic ownership.
This structure is standard for institutional real estate. It centralizes operational decisions in the entity with the expertise and accountability to make them, while limiting investor liability to the amount invested.
Investors earn returns without managing the property. The GP runs operations, marketing, maintenance, and guest services. You get distributions and reports.
When investors vote
- Removing the General Partner for cause (fraud or gross negligence)
- Material changes to the economic rights of Limited Partners
- Dissolving the partnership
Routine operational and strategic decisions stay agile. No single investor can block progress. Major changes that affect investor rights require broad consensus.
Day-to-day financial decisions
The General Partner approves annual budgets, sets the rental strategy, manages staffing, and can authorize repairs or upgrades up to $10,000 from reserves without an investor vote.
Properties stay guest-ready and competitive without endless owner polls. The operating budget protects investor returns by ensuring the asset performs.
Major repairs and capital calls
If a critical repair or capital expenditure exceeds available reserves, the General Partner may issue a capital call (up to 20% of each investor's original investment).
Investors who do not fund within 30 days are diluted or bought out at 95% of fair-market value.
Urgent work like a roof replacement or HVAC overhaul gets done quickly and fairly. The protection of the asset is paramount; the structure ensures one or two non-funding investors cannot put the property at risk.
Drag-along and tag-along rights
If the General Partner sells 100% of the underlying property, all Limited Partners sell on the same terms (drag-along right). If the GP sells only a partial interest, other investors can elect to participate in the sale on the same terms (tag-along right).
Clean exits when the time is right. Equal treatment for all investors. No hold-outs preventing a deal that benefits the partnership.
How disputes are resolved
Any dispute arising from the LP agreement is settled by binding arbitration in the jurisdiction of formation (Alberta for Canadian LPs).
Neutral venue, predictable rules, and avoidance of complex cross-border litigation. Faster and more predictable than court.
Investor liability is capped
The General Partner and its officers are indemnified except for fraud or willful misconduct. Each Limited Partner's risk is limited to the amount they invested.
Standard protection. Your maximum financial loss is your capital contribution. Period.
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Every Luxara property uses the LP structure described on this page. The full LP agreement is provided to qualified investors during due diligence.