Buying using investor's money

[Joseph F.]

I have several people interested in partnering with me to invest in RE.  I have owned rental properties, in one form or another for 20 years.  I have owned rental properties as a true form of building wealth, cash flow and a retirement now for 9 years.  I have had decent success.

Because of my success, I now have people interested in investing along side me.  They are willing to put up the money to purchase the properties subject to my recommendation and experience.  

The plan is for me to identify properties for us/them to purchase and have me manage them for the market rate management fee.

I however, would like to structure the deals in such a way that I have a percentage of the property without putting any of my own money into the purchase.

Does anyone have experience with this, please share.

[Jeff Rabinowitz]

This is something you should hire a lawyer who is familiar with real estate and entity formation to advise on. It is certainly possible to form an entity where you get an ownership stake without contributing any funds. It will be important to have an operating agreement that specifies everyone's duties and responsibilities, addresses how assets are purchased and disposed of, what should happen if duties are not performed, and a myriad of other issues. The documents will determine how any disputes are handled. Make sure they are drawn up correctly.