Indeed, to stay in compliance with fair housing, you need to treat each tenant the same, so that's something to keep in mind. 

To give you something as a reference based on your budget (30-40% down with $1.8M), the general cap rates you will see in the Bay Area are roughly 3-5% https://www.loopnet.com/Listing/1047-Rich-Ave-Mountain-View-...https://www.loopnet.com/Listing/1180-Saranap-Ave-Walnut-Cree...You will find higher cap rates and more 20+ units buildings in SF, Oakland, and Richmond, but keep in mind of their stringent tenant laws. 

Do not mind if it's out of state.

Converting the partnership into a Tenancy in Common (TIC) could work, but keep in mind this requires dissolving the partnership structure and redistributing ownership, which may have tax implications depending on how it’s handled.

@Jonathan Greene I don't mind them generally but when they raise huge amounts for syndications that go south that is another story.

But mostly keep in mind that any property you find the local landlords already know about and did not desire it.

You can change your mind on what you would like to do as you get more experience. 1. 

Do you mind sharing who is your eviction attorney?

Keep in mind that property owners have experience significant hikes in their costs as well (property insurance and property taxes). 7.

Quote from @Jonathan Greene: There are so many new operators in the STR field now, and the questions about certain things are mind-boggling.