.- based on what I feel was an unreasonable counter I'm not sure how to frame my response to the tenants.My questions for the BP community:- Could I be missing something causing real health issues?

If this relationship with your financial partner is solid, you may want to look at this option, giving a preferred rate to investors and you/your partner developing the schedule of hurdles and splits.Many options to consider, but honest conversation with your partner seems in order.

If you're reading this and saying it's a terrible idea or completely unreasonable or unrealistic, please let me know why :) If you've done this before, please tell me about your experience!

But I'd treat them like legitimate buyers with an unreasonable request rather than likely international fugitives hiding their bounty (not that you are, but honestly could be either!)

The tenant attorney and tenant rep broker of course will try to do the opposite of what the landlord wants in ultimate guaranty security of lease, annual rental increases, and long term primary lease term.If you left it up to a tenant they would try 3 year primary lease, blocked rent increases so not annual, sales clause if not at certain level they can terminate or reduce rent, co-tenant anchor clauses, crazy broad restrictive uses for other units in the center, no personal guarantee, no disclosure of personal or business financials per the lease, set up a single entity remote LLC so they can bankrupt it for one location if things go bad, put a ROFR clause in the lease, incapacity clause where if tenant gets sick or hurt they can cancel lease, construction road widening clause where tenant can pay reduced rent while access is reduced to the center, unreasonable CAM cap clauses, etc.I can go on and on with the crap I have seen in leases for my clients buying retail centers where I am the broker.

This means I never see passive multi-family buildings, so I'm unsure of their specific requirements. that said, 50% occupancy is awful and lending on that would seem difficult to say the least. if your building is one of 23 it seems unreasonable for you to bear the burden of a total vacancy rate.

The only scenario I can see age or lack of experience being a hurdle is if you were trying to secure private or investor money.

I work with Redlands planning quite often and it tend to get more difficult every time due to bureaucratic BS.   2)  If there is no lender, splitting the lot is relatively easy although it will take a little bit of time and money but nothing unreasonable.   

I have done is a preferred return witheither a look back or multiple hurdles so higher returns I get more and if deal makes less $ I make less

In a unit that small, with good, clean, decent tenants, refusing to grant the new guy a one-time waiver is unreasonable.