Partnership Question - Please Help!

[Brett Dickerson]

Hi everyone! New investor here, I am seeking for some help to make sure I am not missing something in the partnership I am entering into with my Mentor. My friend who I have know for 5 years is 65 has a successful rental portfolio and is excited to pass it forward to help me get stated and is just re-energized with how enthusiastic I am about real estate. (Caveat - I have been a die hard BP fan for 6 years and bought our first home from the 90 day challenge in 2017). Jim an I have decided to go into a partnership because it allows him to have an exit strategy and become 100% passive, while allowing me to get a jumpstart at 35 years old utilizing his capital. He owns 6 paid for rental homes and I am going to buy one of single family homes (below market value!) and then he is using a 1031 exchange to buy another single family rental, while saving (Deferring) a lot of money in taxes. I am purchasing his home for 500k and he is buying a rental that I found for 500k. We have an 50-50 partnership LLC that we are going to quit claim the properties into so we have 1 million in properties together; I will have a loan for 375k. Since the 2nd property won't have a loan and is currently rented, we are going to have $6,200 in rental income and a $2,900 debt payment on my loan, putting cashflow into the partnership until our Emergency fund is met and then splitting the cashflow 50/50 while I handle the property management. The idea is that if we do this with his other 5 properties (adding 10 more properties to the partnership) and we hold everything for 10-15+ years, I can either buy out his half or we can just sell it all and split the profits. I would then pay off my loans from the homes I bought from him and he would have made a lot more money, regardless of the gains at that time. This sounds like a great idea on paper and it is a way for me to get so much more capital than I can do on my own....But what the hell am I missing or is this just a unicorn type of situation??? I appreciate any comments to help me get going or avoid a problematic situation...Thanks BP!!!