If just going this path is more practical it would simplify things significantly, but everything I understand says introducing these new activities and the respective liability could expose our other property to risk if a nuclear claim occurred related to either property if they were part of the same LLC. 

If something he feels does require a response he is always professional and respectful. 

These are not typical life insurance policies.If the down payment comes from an existing asset whether it is money from money market, money from savings account, money from CDs, money from heloc, money from selling stocks, money from stock margin, gift from family, money from life insurance it does not achieve a 100% LTV with respect to determining return.  

Cost segregation can help boost cash flow, create substantial tax savings, and increase the profitability of the warehouse operation by accelerating depreciation.A cost segregation study is a strategic tax planning tool that separates the assets that have a shorter useful life and can be depreciated over 5, 7 and 15 years from the residential rental property or nonresidential real property that are depreciated over 27.5 and 39 years, respectively.

Right then and there he realized all bills paid was not only an economic burden but it did not put the incentive in the right place, w/the user and was not good for the environment.  

Respectfully, you're asking a real estate community if it's a good idea to invest in real estate. 

Does the loan work in the high-interest environment?

Not a smooth ride, not a steady ride, but when you get it to work you have the type of environment investors dream about. 

I respect her more than almost anyone I know.

@Jonathan Feliciano: While I respect everyone's experiences and opinions, this is also such a unique situation to you and your potential partner.My first out of college was with a group called Phillips Edison & Company.