It sounds like you have a solid plan in place.

It is also my understanding that many lenders still require a personal guarantee for properties held in an LLC.

I understand real estate to be capital intensive.

Once, you build a solid relationship with a contractor, they may be willing to do this for you. 

Make sure you have a solid plan B or exit strategy though since the numbers won't fully answer this question for you. 

Can you help me to understand what are the pros and cons of REO properties?

I highlighted anything that I didn't know or understand and started researching it here on this site. 

The structure we landed on was as follows:- Fixed Builder fee of $300k (each project varies but are 2-6 units, and 5,000-9,000 total finished sq ft)- Fixed Return on all my initial capital invested of 50% (plus return of 100% of initial capital)- Remaining Profit Split of 60/40 (60% to me, and 40% to him)I understand a lot of this hinges on how accurate the proforma is and how close we can get to actually hitting our development costs estimates, build cost estimates, and sales per sq. ft. estimates.

I've heard several podcasts including Amy Majoory and the Polites who talk about using OPM for down payments but I still don't understand the logistics when the PML is only for the down payment, but the other funds are borrowed from another entity.For example: how do you structure the PML plus the actual purchase/rehab loan and still make money?

I understand this will vary from person to person and could be a debate so feel free to PM me if you have some thoughts.