If everything works out and you are dealing with a legit company this could be a great long term tenant paying above market rates. 

Depreciation lowers taxable income now but is subject to recapture at a maximum 25% rate when the property is sold.

You'll pay a higher rate and may need to have more of your own money in the deal in case of unexpected repairs. 

So with interest rates high...

It's important to know what market rents are for what you are analyzing, many properties are super under rented and you have to get them to market rates. 

Like our other class B shares (we also invested in Praxis), they stopped paying out pretty quick when the interest rates when up.

Where these numbers are found, there is a very high rate of rent actually being paid.We have over a dozen Fortune 500 companies just in Metro Detroit with huge Healthcare, Auto, and mortgage industry National footprints.

I just got something small and well within my means - refinanced when rates got low and now it's a decent little cash flowing rental 

You also implied that we don't specifically price deals for our clients and the client's "rates and fees will be much higher".

In your case, changing the property from a rental to your primary residence constitutes a change in use.The depreciation recapture will be calculated based on the fair market value of the building at the time of conversion, not including the land value.Since you're tearing down the existing structure, the entire amount of depreciation taken over the past two years will likely be recaptured, as the building's value at conversion will effectively be zero.The recaptured amount will be taxed as ordinary income, up to a maximum rate of 25% for residential rental property (Section 1250 property).