What to do with a Silent Partner

[Esther Rivera]

Hello, I currently own a well established restaurant and would like to open a second location. I want to buy the next location so that I could grow my business plus begin to invest in real estate. I currently do not have the amount I need for the full downpayment, plus I do not want to leave my current business at 0 in its savings. I have someone interested in being a silent partner. My question is how or what would a silent partner get from a deal like this, or what can I offer if they would provide 20% of the cost of the building only? So basically they would be putting in 20% of the purchase price of the actual building only. I could cover closing costs and the rest needed to get the restaurant established. It is a pretty popular restaurant so I am sure sales would do well. Appreciate any input.

[Chris Seveney]

Quote from @Esther Rivera:

Hello, I currently own a well established restaurant and would like to open a second location. I want to buy the next location so that I could grow my business plus begin to invest in real estate. I currently do not have the amount I need for the full downpayment, plus I do not want to leave my current business at 0 in its savings. I have someone interested in being a silent partner. My question is how or what would a silent partner get from a deal like this, or what can I offer if they would provide 20% of the cost of the building only? So basically they would be putting in 20% of the purchase price of the actual building only. I could cover closing costs and the rest needed to get the restaurant established. It is a pretty popular restaurant so I am sure sales would do well. Appreciate any input.

 have it be a loan not be a partner. The loan could be secured by the property as a note and mortgage and that way you define the payment structure and interest rate to pay them. They get no upside but are downside protected because if you did not pay him he could foreclose on the property to collect what is owed. That is my recommendation (also called it being a debt vs. equity investment)