Considering an Equity Participation Structure Home in Vegas— Looking for Feedback

[Ken Kammal]

Exploring a Private Equity Structure on a Las Vegas Property — Seeking Insight

Hello BiggerPockets community,

I’m exploring a private equity-style structure on a residential property in Las Vegas, NV and would value input from experienced investors and private lenders.

Rather than using a HELOC, HEI Company, or refinance, I'm considering a model where a private investor provides capital secured by the property and participates in a defined share of future appreciation instead of receiving monthly payments.

At a high level:
• Investor capital is secured by the property (Lien)
• No monthly payments (not structured as traditional debt)
• Investor participates in appreciation upon sale, refinance, or buyout
• Clear exit and buyout framework

From an investor perspective, I’d appreciate thoughts on:
• What would make this structure compelling or unattractive
• What protections you would expect
• How you would typically structure or document something like this
• Any common pitfalls to be aware of

I plan to involve a real estate attorney and structure this properly—I’m simply looking to understand how experienced investors view this type of arrangement before moving forward.

Appreciate any insight.

— Ken

[Bill B.]

I assume you already know why this is a horrible deal for the investor and is why you only want to be on the other side of the investment. I doubt you could raise $1 with this offer. But they do say a fool and his money are soon parted.