Help with High Class Problem

[Blake G.]

I am new here (hello!) and new to real estate investing. Earlier this month I bought 2 mixed use buildings with a total of 7 units. I put 20% down on each property and got commercial mortgages for the rest. I plan to manage and upgrade the properties and rent-roll over time.

I now have a trusted individual who wants to passively invest. An influx of cash would be welcome. I am not sure how best to structure the investment. The factors that come to mind are the credit risk that I have taken, the cash I have put, the time that I have and will continue to put in, and the cash needed to upgrade the properties in the coming years. In time there will be income to distribute and eventually there may be the sale of the buildings.

For the sake of easy math let's say that the buildings cost $1M and the investor wants to put in $100k. What are some of the ways in which to structure the investment?

Thanks in advance.

[Greg Scott]

Blake:

Passive investor = hands-off.  No difference in the legal requirement.

This podcast might help you understand the issue: http://www.lifestylesunlimited...