@Kevin Sobilo, is generally correct in what he mentioned, however, there are a few revenue procedures that could allow for a split allocation of investment & primary portions of each where we could still discuss an exchange. 

Here are some resources I found really helpful on my journey:1.

It's usually around $15 on Amazon. https://amzn.to/3VKVLLP He virtually walks you through this step by step, and it's a great resource if you have questions later and don't want to go back to the forums.Second, as a Realtor and investor in Illinois, I agree with everyone.

The right property manager can be a valuable asset for your investment and can help you find the other resources you need.Realtor – Look for one who knows the market, understands your needs, and hopefully has a good relationship with your property manager.ContractorLenderAttorney – A local attorney or someone knowledgeable about the specific market can be a great help when it comes to local ordinances and laws.

Feel free to DM if you'd like some resources on the subject.

I need advice on the best allocation of my money and how to achieve this.

I'm new to Bigger Pockets and thrilled to have found this amazing resource.  

How much should we allocate to demo such a structure and prepare it for development so that it's attractive to developers?

If he's a vet, I'm sure there are resources he has access to that others don't, in addition to the regular places for support (eg local church). 

Experience is key for sure - but there is also the reality of LPs needing to allocate capital and the number of experienced operators available to invest with will likely be smaller than the LPs who want to invest.