Lastly as an illegal unit it is  huge liability if there was a trip and fall claim, fire etc your insurance may not cover.I recommend renters insurance for whoever lives there is mandatory to add another layer of protection. last option not considered is you living in the bonus unit to have a free place to live with minimal risk 

It also makes cleaning easier, as you don't get that layer of nastiness where the sink meets the counter.But, if this is a low end, low rent type area, probably best to do it as cheap as possible.  

The 1% ownership will still allow me to legally manage my properties but it will help create another layer of protection having the management vs ownership LLC. 

Real estate investing has many layers, from financing and rehabbing to tenant management and taxes.

A syndicate is already an LLC or a LP so I don’t see any added liability protection by having a second entity layer.

Clearly these are just example numbers, but it is how I would look at it.And then layer in if refinishing all the 1 beds is a $100k renovation, but converting into a 4 units is a $150k renovation, now you are spending more money to create less revenue AND have a property worth less at the end of the day.  

I used to have the issue to so I removed the flooring again and make it flat and layer at the top again.

Just be aware that this adds another layer of complexity, and you’ll want to check with both your lender and a real estate attorney to make sure everything is set up correctly.When it comes to terms, owner financing gives you a lot of flexibility:Interest rate: You want something attractive to the buyer but that compensates you for the risk of holding that second lien.Repayment schedule: You can choose a traditional 15- or 30-year schedule, or go with something shorter if you want to be paid off sooner.Balloon payment: Many owner-financed deals include a balloon payment, meaning the buyer pays off the remaining balance after a set period (usually 5-10 years).

If you trust your contractor and can stay on top of the project, you might not need a property manager my understanding is the property manager is playing the contractor's role for some smaller projects, not another layer on top of the contractor. 

Retail guys get benefits, have offices paid for, have departments they pay for that they don't use, have layers of management than earn on their production.Brokers get access to wholesale channels.