distant partnership agreement

[Brock Hoffman]

Hey everyone,

I am looking to partner up with a friend I graduated with who is also interested in RE. We want to start with a smaller multi-family property and gradually move into large apartment complexes. He is working full-time in Wisconsin and I am working full-time in Michigan. Currently I am looking for a property in the Grand Rapids, MI area, and when I find one that we both like, I want to be able to pull the trigger. He has more of the money for a down payment and closing costs, but I will be more of "the boots on the ground", analyzing the property and dealing with any issues that arise. 

I was curious what a good partnership split would be in terms of profit for something like this. We are both investing together, but he is bringing more money to the table, while I am doing more of the work per say.

Should it be a 50/50 split? What do you all think? What has worked for your partnership?

Thanks!

[Scott Jelinek]

I think 50-50 is a fair split because although he is bringing more money, you are finding and structuring the deal. Just be sure to spell out all details of the partnership ahead of time. I have made the mistake in the past of saying “I don’t have to worry about it I trust him” or some variation. But you never know what the future will bring. Be sure to get all the details In writing now of how the whole partnership will work including all decisions and eventual disposition.