Rental Arbitrage for shallow-pocketed newbie

[Matthew Arnold]

Like it or not, AirBnB has helped homeowners and renters subsidize and/or make returns off housing by subletting to vacationers and short-term renters. I learned that this practice is called 'rental arbitrage' and some residential RE investors are buying downtown condos in desirable metropolitan markets with this exact use in mind.

Phenix and Sola salons are doing the same thing for commercial properties. These salon operators sign leases with commercial landlords and then sub-divide the leased space into smaller rooms where stylists can set up mini beauty parlors. The stylist is happy because he/she has smaller start-up capital requirements and lower monthly overhead. The salon owner is happy because he/she can generate rental revenue that greatly exceeds his/her rent expense (by as much as 10x!). And the landlord is getting the desired rent as well. Everyone wins, right?  

I don't have tons of cash but want to get into commercial landlording here in the Denver area. Commercial rental arbitrage seems like a good way to get started. I enter into a long-term lease on a commercial space, subdivide and outfit the space to accommodate a specific use, and generate positive cash flow once certain occupancy rates are achieved.

I like the salon model but there are already so many in my area. Can anyone think of other rental arbitrage models that would work in a commercial space? 

What shortfalls does rental arbitrage have (besides the obvious fact that you don't own the real estate)?

Any legal/regulatory barriers?