Make sure you consider all the extra expenses that str properties have:third party software, supplies, county taxes and business licenses, utilities, internet, etc.and run the numbers to estimate what your cash flow will be in the high season and low season.  

Make sure you clearly understand what each party is responsible for and underwrite accordingly.Pay attention to ReimbursementsMost retail leases follow what is called a Triple-Net (or NNN) lease structure.

I have a Cincinnati-based short term rental 3 parties are interested investing in together, profits/expenses would be distributed equally. 

Basically they refused to allow both parties to walk away with a check.We ended up running it as an agreement in the PSA where we did a normal closing and then they provided a wire post-closing.

There are firms that can act as an Intermediary (middle man) to assist two parties (the principals) to achieve certain tax objectives that can't be achieved in a transaction directly executed between the two principals. 

The reason being there's always those that take it too far, allow too many people in their units, huge parties with no concern for neighbors that are residents, etc.; and owners are too far away to actually check properties, so I can see the desire for having owners living close by. 

I was able to build a small team consisting of a third party contractor who is now dedicated solely to my properties, a part-time business manager, and a part-time project manager.

My recommendation is usually to keep each property in a different LLC to avoid comingling assets and therefore risks to those assets, and to contact your insurance provider in order to ensure the LLC is an insured party under the policy.

But also, wouldn't either party be able to borrow against his/her %50 share in the equity? 

that said you can always ask, you can always offer them cash to leave and if both parties (landlord/tenant) agree to end a lease agreement you can always do that.