Need Partnership & Compensation Advice

[Jeanne Fisher]

Hello Board,

My dad and I are seriously considering purchasing a 6-Plex in my area. He lives two hours away and has already built a very successful real estate (buy and hold) company. I have one rental house of my own and my personal residence.

If we entered this partnership he would most likely have to personally co-sign. I would handle keeping the property rented and dealing with renters. He is a Mr. Fix It and can handle any minor repairs himself. I would handle probably 85-90% of the management and he would run by the property when he's in town for maintenance.

My original thought is to create an LLC that we each own 50/50. He would have to contribute capital to the LLC to meet the down payment. We could pay his personal loan back first as of now I'm projecting this as a positive cash flow property.

I want to make sure that I have a solid ownership stake in the property. I don't want a managers fee or a finders fee. I want equity. Also, I want to make sure it is separated from his estate. If I'm going to do all this work I don't want it to get "locked up" with everything else!

Does this even make sense? How are these arrangements normally structured?

Any advice and suggestions are appreciated.