Attention all readers:  Could you please give me your thoughts/feedback on the following idea?

I have been building new single family homes for investors. I wanted to find a way that I could boost my investors returns but still keep it attractive for my construction business to make a profit.  

So my idea in summary is:

1. Builder finds lot for investor for 25k (I currently own 20 and have access to 350 more)
2. Investor buys lot, secures financing, and hires the builder to build the house on the investor’s lot for $170k.
3. When the construction loan has been paid off and the certificate of occupancy has been issued, builder then pays $29,250 (75% of Investor’s down payment) to investor for 15% stake in the property.  This leaves the investor with only $12k invested after closing costs.
4. Builder and investor enter partnership, rent property for $1600, covering expenses and also putting money in their pockets each month.

End result: Investor owns brand new $210k appreciating investment property that cash flows over $200/month for $12,250

See below for examples on deals.

Example 1 - A traditional investment property sale on a new construction

• Retail Value: $210k
• Sales price: $195k
• Loan Amount: $156k
• Down Payment: $39k
• Closing Costs: $2.5k
• Total Cash Invested: $41.5k
• Rental Rate: $1600/mo
• Operating Expenses: $503/mo
• Mortgage Payment: $857/mo
• Cash Flow: $240/mo
• Cap Rate: 6.75%
• Cash on cash return: 6.94%

Example 2 - Okay now this is how the numbers look for the investor in my Partnership Program

• Retail Value: $210k
• Sales price: $195k
• Loan Amount: $156k
• Down Payment: $9,750 ($29,250 was paid by the builder after closing for a 15% stake in the home)
• Closing Costs: $2.5k
• Total Cash Invested: $12,250
• Rental Rate: $1600/mo
• Operating Expenses: $503/mo
• Mortgage Payment: $857/mo
• Cash Flow: $240/mo
• Investor’s 85% Share: $204/mo
• Cap Rate: 6.75%
• Cash on cash return: 20%

Any readers - please let me know your thoughts on this idea.