He comes recommended by a very good friend of mine, who I could easily see as my mentor.This GC guy wants to enter in a partnership (I don't know the detailed terms yet) and want to flip houses and was trying to explain the obvious to me that flipping is less risky than to maintain a long term renter and dealing with their hassles on almost a daily basis, making small profits for a longer duration compared to profit up front (if we really could make that happen!).  

If you believe this partnership is a good deal for you, I would tie some or most of their improvements to actually exercising the option. 

(important to know before you decide to resell it)If you have an investor you can work with, go into JV or some other partnership agreement would be much better for you, just because the potential is high after the renovation.

I need some advice on how to vet a partner and how to structure a partnership.  

My wife and I have just recently been in discussions with a GC in North Phoenix regarding a partnership opportunity on a fix-and-flip.

Or to pull the trigger and go after them in court now.

They required 2 DE LLC's: LLC#1 my husband and I are 50/50 partners and LLC#1 is sole member of LLC#2 which will be the borrower for the loan and it is a disregarded entity.Since the expense has been incurred and we are set with another lender, and since LLC#2 is registered to do business in the states where the rentals are located we would like to use the setup.To date I am a Real Estate Professional, this is what I do full time and my husband holds a job.I believe that there will be no issue taking the loan to LLC#2, changing the deeds when the loan closes from us to the LLC and that income/loss will pass through to LLC#1.I believe that since LLC#1 is a partnership that again we still will continue to report income/loss to our personal return and I can continue to be considered a Real Estate Professional. 

I have partnered with a to real estate agent in the Austin (South TX Market).  She does the market and real estate piece and I do the analysis and networking using various goals we have set in order to decide on worth...

DSTs are similar to limited partnerships with a key distinction that they allow individual investors to do a 1031 exchange into a DST, which is not possible with traditional partnership structures.  

And then pull the trigger.