The typical policy will cover the existing structure at Actual Cash Value (ACV = Replacement cost - depreciation) plus the cost of the renovation at Replacment cost. 

•The investment could be structured in many ways: secured or unsecured promissory note, joint venture, etc.

Suggestions on how to structure this deal. 

The only time he's been close is when someone came with cash, but the wife of the guy with cash put the cabosh on the deal.Any ideas on how to structure something like that?

@Matt Hudson It would be nice if insurance premiums were easy to estimate, but it is also probably nicer that insurance policies are perfectly tailored to the needs and specifics of a certain structure.

If you lease to own how would you structure it?

@Jason ClecklerIf this is a genuine tax partnership in that it is subject to Subchapter K and files a 1065, you're going to want to engage a tax CPA who will take into consideration your facts, circumstances, and goals so that the buyout can be structured advantageously. 

Corporate structures, get the help from an attorney or do some reading entities and structures. 

A layer of 5/8" type-x drywall on the ceiling and min. 1/2" drywall around structures ( garage walls) supporting the partition would be required. 

Plumbing: I would plumb the units with Pex supply lines because they are much more likely not to burst if they freeze.