anya,You may find a hard money lender that will work with you, but it depends on how much collateral you have in the property, they will not help you if there is no skin in the game, and if they do, your interest rate and fees will be killer. from what it sounds like, you may be better off selling as is and not creating more debt in order to maybe make more money on the sale. 

Don't hard money lenders even require some sort of skin in the game?

Hearing no is part of the game, develop thick skin and move onto the next bank!

However, most owners are not motivated enough to hold the note on a "new investor" with hardly any "skin in the game." $5K on $240k represents about 2%, which doesn't leave any equity for him to pull out if he has to foreclose.

Do I need to have him put in 10% or so to have "skin in the game"?  

I think I could sell the building for top dollar right now (1 - 1.2 million)  I am currently learning about multi-family and want to purchase a sizable property with OPM as well as using the equity from my building so I have plenty of skin in the game. 

My plan was to use the $100k as my portion of "skin in the game" and work with either a portfolio or hard money lender for the rest.

I also have my own properties , so I have skin in the game , and would definitely be able to help you.

There are lots of issues with this.1) Skin in the game: For a lender to invest in your project you have to invest in it.  

HML want some skin in the game or serious equity in the deal.