I've owned a retail business for the past 13 years leasing only. Always wanting to own a space and build equity. My lease is up soon and I have found a property I'm interested in. I had someone I know offer to come on as an investor/silent partner on the property side only. He wants no part of my business.

I do not have the cash flow for the down payment needed for the property in question. He owns a business himself along with his own building already and has been verbally approved for a loan by his banker (20+ year relationship) which whom I've met with. The building needs heavy reno for my purposes. Along with my space we are also planning on 3000 sq feet of rental space.

He is planning on 300K cash DP. He came up with an amortization schedule for this loan at 6% for 10 yr Total cost 399,674 giving him a profit of 99,674 over 10 years and he is also asking for 50% ownership of the building at the end. He is planning on the renting tenant to pay the monthly note to him. The rest of the loan would be paid by my store which would take up the rest of the building space. ($9500-11000 based on interest rate) 25 year note which we are both planning to be on.

Also discussed was after he was paid off in 10yrs, using the rental money towards the principal balance so we can pay it down faster. We have not negotiated a price on the building as of yet but the asking price along with what we think we will need for rehab will be around 1.9-2.3 mil.

I have not done a deal like this before so I do not know what to expect as far as rates, payback...Is this way off base or close to what is expected with a private partner? Is it normal for payback to amortized with a partner?

Thank you to anyone that can shed some light on this situation for me.

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Silent partner/Investor with equity + full amortization payback

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