What Would You Charge?

[Marek Berry]

I'm seeking input on what the BP community thinks is a fair fee for my role in finding investment for a land-development transaction.

- The seller owns about six empty lots in TX in a desirable city. He's sold five of them and is also acting as the builder of the homes that will go on the lots.

- Seller has offered to "sell" me the last lot. He would build then sell the house + lot (it's essentially a loan to him so he has some capital to play with since it appears most of his is currently tied up).

- The return has a hefty minimum but can go higher depending on the sale price.

- He's a family friend and I trust him, plus he has significant experience in real estate.

I don't have the funds myself but am working to finding an investor.

Would you, the BP community, structure your fee based on funds invested OR profit once the deal is done, or both? And what would you set as the fee? I understand 3% paid by the investor is a common finder's fee, but this also feels like a unique situation that could allow for a different structure. I've also had recommended a 5% acquisition fee is together with a recommended minimum of a 25% interest in the project, which sounds very generous to me.

Thanks!