What's a fair percent of ownership to bring on partners?

[Clayton Morgan]

Good morning BP colleagues,

I have worked for a number of years to be in a position to build my first new mixed-use development.  It is located on a very desirable corner in Draper, Utah.  It took me almost four years to assemble the land, receive the needed zone changes, vacate easements, adjust underlying plats, etc...  Now I'm finally ready to start building an 11-unit apartment building and have an additional commercial pad for future development.  However, construction prices more than doubled in the time it took me to get ready to build and my 10% cap rate is now around a 5%.

The lender I've been coordinating with for three years now wants me to come up with an additional $500-600K to offset the loan-to-value of the construction cost.  I don't want to assume that much more risk.  I can either sell the development and break even, bring in a partner, or keep the land and wait for better construction prices (The existing houses can provide enough rent to cover my mortgages and make a little cash flow).  That said, I have almost all my money tied up in this one development and don't want to sit on a 5-6% cap rate when I can free up money to buy more deals in the next several months and make more.

I've had a couple offers to partner but it seems like I'm giving away my equity.  The latest offer is the potential partner will secure the loan for construction and receive 50% (or possibly more) ownership in the project.  While I would rather have 50% of something as opposed to nothing it seems like 50% ownership simply for securing the loan is a steep price to pay.  

What are your thoughts?

Respectfully,

Clayton