I'm leaning towards looking for an institutional tenant but we have to diversify.

Heck no, I would run away from those especially in 2023 (and forward), this asset class IMO is too saturated with institutional-level ownership.

However, the more likely scenario is that there will be a monetary loss and she'll learn a lesson about buying a house with someone she's not married to.If they are both agreeing to fairness, they can sit down with an attorney to discuss their goals and the attorney can draft an agreement.Personally, I would expect a loss either way.

Side note, there still are some smaller institution that may have a grant program for ADUs (CalHFA has a program for grants).

Any of the institutional lenders we work with will have a tough time shoe-horning a square peg into a round hole.

Institutional landlords will have listing agreements with their listing broker(s) which dictate payout structure.

@Jeff Valone If you do any type of partnership other than just a monetary one make sure to have an exit strategy written in to the agreement.

Our main clients were large banks and lending institutions.

Don't forget paragraph 5, that puts the Tenant on the hook for repairs to certain things like walls.Paragraph 1B covers the notice you were to be given - looks like 90 days.Paragraph 2A indicates that the monthly payment is an installment on the annual rent amount.So, if this is the actual lease in place, it would appear that you are owed for a full year's rent, based on how paragraph 2 can be interpreted.This is the sort of thing where you hire an attorney to draft a letter that requests payment of your damages; failure to pay leading to the attorney filing civil suit for the monetary damages.Can you get a stronger lease?

Given large Financial Institutions buying real-estate it vast quantities.