Whatever you think is a deal is going to look like it's good cash flow and have huge capital expenditures.

These are expenses incurred before your business is active, and they typically aren’t immediately deductible in full, as they are considered part of starting the business rather than ongoing operational costs.To provide more detail, according to IRS rules (as seen in the screenshot), you can deduct the lesser of $5,000 or your total startup expenditures.

Considering a PM company's main objective should be to represent the landlord's best interests, some expenditures might seem questionable and could have been avoided.- It seems that their prices are substantially higher than what would normally be charged for the same services.

While renovations and other expenditures can be capitalized (and in some scenarios deducted) when you classify property as a rental, that might not be a significant impact if you intend to sell the property soon and can qualify for the 2 out of 5 year deduction for primary residences. 

But right now, a cash flow market as a small deal will likely be in a C to D area with capital expenditures and more volatile renters.

At the present rate of rent it is not within our budget to allocate the funds for this expenditure. 

This is the exact problem I've been having with these higher rates and the market overall - cash flow too small to be a LTR (or just fix the property up good to minimize capital expenditures) and accept the small cash-flow. 

Looking back, what business case do you really have to justify those expenditures?

If the money is coming from the government (We the People), it won't raise the prices of houses because that expenditure is not coming from the builder, lender, or selling agent. 

Is this a Capital expenditure or an operating expense?