I still have a hard time understanding how this business model works for them, but perhaps that upfront fee covers for lack of deal flow (?) 

I would start with them.I am not based in LA, so I don't know your exact laws, but I think I can still provide some initial direction for you to find answers, and maybe offer an idea to research.  

But for most properties, it’s a smooth way to add value and potentially start bringing in some rental income.To give you an idea of what’s possible, I ran an analysis on a project in Sycamore Square, Los Angeles.

Option 4: 20% down on 2 to 3 properties Also open to hear other ideas, I'm self employed so getting a lender can be a bit more difficult.

@Khaled Seirafi what business would make the mistake of providing BAD references?

I’d love to hear where you’re leaning and swap more ideas.

*I'm a property manager, not an owner, so I do have a 3rd account for business expenses as required here in Oregon.There are a plethora of software/apps out there for managing properties and funds.

I asked him a lot of questions about the business and as soon as I got home I was doing research and joining RE forums focused on multi family.

So for the first property which will cost over $1 mil to construct, there will be stacked loans, essentially $280K will come from loan assistance program,( the name is not correct but the same idea).

I run Forged Home Buyers, a San Antonio wholesaling business, and my business partner is an agent with Virtus Realty.