Also, if your tenant gets mad at you, they can turn you in for any violation and the fines start accruing.  

I am accounting the percentage for it which will reduce the number we refer to "cash flow", although that money sits in a bank account accruing month after month....unless of course there is an expense. 

One for income/expenses and one for security deposits that accrue interest. 

It can become rather complicated, but simple having caps where increases are carried forward that earns a rate of interest and adjusts later where actual payments may go up to a point and excess amounts while not payable are still assessed, accrue interest until the next rent amount adjusts then amortize the deferred amount over the next term together with any increase.In numbers, say a cap rent was 500, first adjustment is 70 more, but you have a 50 cap.

Sam Just think of the HELOC as a credit card - whatever you use, you have to pay back because interest will accrue and if you don't use it, then there's no interest.

The date of death value is the cost basis plus accrued interest through date of death (this is applicable to estate tax return).

In addition, this is a "country club deal" where the preferred return is calculated based on the initial equity investment and it accrues but does not compound if there's a shortfall. 

If not, the preferred return will accrue and you will need to distribute it either in a future year or at sale.Note: all of this is for apartment syndications but the same should hold true for any partnership with a passive investor. 

You'll be accruing/paying property taxes and probably need to place insurance on it.

@Lien Vuong's solution is a good one if there's enough cash flow to cover the additional loan, or you can structure it so that the interest accrues and the entire loan + outstanding interest is due at the end of the 2 years.