They will often want a new building constructed and building today with labor and materials is very expensive versus retrofitting existing building.When I buy value add vacant buildings the goal is to double the return on investment within a 3 year period.So if I can use the existing building and retrofit to same concept ( example previous burger inc. but now Whataburger wants to come in ) then not as much tenant improvements to convert.So if rent 20 a foot for 5,000 ft that is 100k NOI NNN a year. 7 cap value is about a 1,400,000 stabilized valueSo if I buy it for 400k and have 300k in it more 700k to get new tenant in the value is then around 1,400,000 based on NNN 20 a foot and a 7 cap rate exit value.If you want a premium price then you would need to sell to an end user tenant ( regional or national in nature) that wants to buy the building and put their concept in there.

I'm seeking insights into the pros and cons of investing in Accessory Dwelling Units (ADU) in south bay versus buying a condo in east bay, particularly in terms of appreciation and cash flow.

My primary issue is the value added by the ADU versus the cost.  

I think in most areas it's faster and easier to remove a tenant when the lease has ended/expired versus just when there's a dispute or unpaid rent. 

Then another couple weeks to find someone that probably won't move for another 3 or 4 weeks for an average of an extra 2 months versus just 2 weeks. 

Thoughts on why you (or anyone else) like to be more strict on that versus income? 

I don't see why someone pending eviction versus someone paying rent would have any impact on your policy.I don't see anything stopping a person from leaving the water running, to run up a bill or to damage a property.

It's a huge city of course and I see it more in parts of the city versus other parts.

It's more of an appreciation market that will build strong equity versus the Midwest where you might get more initial cashflow.

As far as Saginaw versus Belleville, Saginaw is a very landlord-friendly city and about 60 percent of the population rents, so there is no shortage of prospective tenants.