Equity Sharing Agreement/ Fractured Condo Deal

The deal is for 41 residential condos in Florida. The units are divided between 3 complexes in the West Palm Beach area.



Contract price is $1,995,000

NOI 240K

98% occupancy ( 1 vacant unit).



I put the deal together and submitted it to my HML, and he will lend a maximum of $900K at 13% interest only and about 10 points.



The seller is willing to hold a second, but after the bridge loan and the sellers terms on the second, the deal is no longer attractive from a cash flow stand point. (thats my thought).



The seller is willing to finance the deal with approx 20% down (approx 500K). This is where I need a partner/investor.



I need the partner to bring the cash down payment, in exchange for 50% of the equity in 5 years. The property will be placed in an LLC with the investors interests secured by the property/stock or both. The investor would also recieve a % of the monthly net profit.



I have available a mini executive summary, and a current income statement.



I will answer the most obvious question....... My mid fico score is not high enough to obtain conventional financing for this deal, as such I would not be able to immediately refinance as well (need for at least 5 years on the aggreement).



Please ladies and gents.....I have been working on this deal and other scenarios for some time now and I am VERY familiar with what I CANNOT DO, what I need here is how I CAN get the deal done.



The HML that I am working with has already run several scenarios with me, and he has said that he will keep doing so until I bring him a deal that works.....i trust his judgement. However if the deal can get done without hard money, then that great too.



And by all means, educate me I can never have enough education. Thanks and I look forward to your input.



Comments(3)

  • bargain7624th December, 2009

    How much up front money will YOU have in the deal?
    [addsig]

  • jmoorelpn25th December, 2009

    I have the needed fee to pay for the appraisal.[ Edited by jmoorelpn on Date 12/25/2009 ]

  • jmoorelpn26th December, 2009

    Yes I am optimistic, I dont expect something for nothing.

    An investor interested in comming to the table with the 20% down will of course get the lions share of the equity.

    The HML that I am working with wants to see 10% down.

    I expext to negotiate a deal that benefits all involved, being rigid and inflexible only guarantees that nobody will make money on the deal.

    If you are interested, let me know, if not, thank you.

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