Rougher parts of town have increased maintenance/cap ex, vacancy, rent delinquencies and defaults, and level of effort to manage.  

If it’s only some of the rooms, are they above ground on 2nd floor, ground level, or below ground?

This is just a high level, general statement.Conceptually, selling separately sounds like a bad idea.

Higher Yields: With distress levels rising, project sponsors are willing to offer more attractive terms to secure the capital they need to stabilize their projects.

In my opinion, the more income you have, the higher the allocation should be towards stock / fixed income.As much as you can make real estate passive(Hiring a PM, getting into syndications), there is still a level of work that you need to do.Why spend hours when you already can afford what you can.The extra return isint' worth it.

Private money, depending on your relationship and level of expertise, could lay between 8-12 percent straight.

and am planning to see a few recently built 4/3-4's with finished lower level in good family locations.

I don't know all the particulars, someone more well versed can comment on it, when your income exceeds a certain level, there are limits on your deductions you can take.

I had to grade and level the entire property and plant new grass and it's now one of the prettiest lawns on the entire black.

It depends on if you got to the level of a trade or busienss which would determine if its ordinary income or not.Then the amount of time you spend on the business would determine if its passive or non-passive.