Looking for Partnership Structure Ideas

[Tommy Coleman]

Hello BP folks!  I am a Tech Exec that decided about 6 months ago to dive in and research the holy heck out of how to best approach shifting half my investment capital to real estate from just Stocks and Mutual funds.

I put my 4, 10 and 20 year goals together and then built a plan on how to hit each goal.

Then I started networking and learning everything I could here, books and networking with friends and other investors.

I initially landed on just going for appreciation in my town of Austin.  Investing is really tight here and rental income is not keeping pace with appreciation.  So basically most deals I would be even or cash flow negative to invest.

So then I researched my home town in Texas.  Texarkana, TX to be exact and here I can find decent cash flow, but the appreciation was nominal.  

My 4 year goal is to create $3k/month net passive income to pay for my kids college in 4 years.  I already have a lot saved for college....but how great would it feel if I could keep all of that and just have renters pay for my kids education!

Finally, I came across another area that sent me in a completely different direction.  This is an area that is building a lot vacation cabins and the numbers are the best I have seen in my research so far.  

My goal is to do 5-10 cabins over the next 4 years.  I have bought 2 lots myself and with a real estate agent (partner).

Now I would like advice on looking for other partners:  My thought would be this type of structure:

• I have put the entire thing together turnkey (Land, Builder, Construction, Furnishing and Decorations, Property Manager, everything)
• My thought would be the investor would make the down payment:
  • We would initially split all equity and expenses 60/40.  The investor would get the extra 10% cash flow until their down payment was 75% paid back.
  • At that time the LLC would revert to a 50/50 equity, cash flow and expense partnership
• The numbers in this area based on occupancy rate and rental rate and lot of due diligence are : Cap Rate 11.64% and Cash on Cash ROI of 31.34%
• These are $400k + cabins

Sorry for the long message, just wanted to lay it out and see if anyone has structured investment partnerships like the above.

Thanks in advance for any suggestions.

TC