8-unit Acquisition and Partnership Structure

[Alex Brandimore]

Hello all - 

My business partner and I put an off-market, distressed 8-unit apartment building under contract a couple weeks ago and planned to find private money partners to split the purchase (i.e. 50/50, 70/30, etc), rehab and sell as a flip. The numbers work as a flip and even potentially as a BRRRR.

Here's the issue - we found a private money lender (and friend) to partner with and they are in a position where they need to protect some capital gains from a sale this year and put money to work in a large project. They have no real estate experience and have asked if they can purchase the property outright instead and then pay us to manage the rehab project and potentially even the lease up so they can take over management of a fully-leased/renovated asset when complete. 

Are there any recommendations for how to structure this kind of partnership/deal? Should there be an acquisition fee? Is there a percentage that is usual/customary for managing rehab projects? Are there pros and cons I am not thinking of? Questions to ask?

All involved want to be fair, maintain friendships, and since this is a new partnership structure for me, I would appreciate any and all guidance or resources that you all have! Thank you in advance.