If you find the conditions or terms of the lease are unacceptable I will allow you to be released from our lease agreement .

I am managing these myself in the short term to learn process(es) 1st hand, to ensure wants vs. needs in a PM to temper my expectations when I do eventually turnover to a professional PM.  

He would like to see a 7% return on his investment, interest paid monthly, and his money back when we eventually sell or cash out refi (~10 years out).Our current intentions are to live in the new building, rent out our primary, and short term rent the 3 units adjacent to our unit in the new building.

This method allows you to set terms that not only cover your existing mortgage payments but also provide additional cash flow each month.

I was thinking I could cash out refinance and short term rent it.

In the beginning, I didn't even know what common terms of REI were. 

Do you have the property under an executed contract or is this just a verbal terms from the seller?

Beside the “subject to” that’s recently become the subject of much debate we utilized  ”no interest short term owner financing”, the “2nd mortgage crank”, substitution of collateral, mortgage subordination, wrap loans, real estate “exchange” (not for tax reasons), sale - lease back, guaranteed rent payments, sale - buy back, land offered in lieu of down payment, zero coupon bonds as substitution of collateral, and a few others that escape my memory.  

All of our assets have significant cashflow, large built in capital gains, great LTV position, Loans are at 7 year, 10 year and 20 year balloon terms.  

It was during our first deal that I realized a term sheet is not set in stone.