Assuming this drops a little due to unforeseen circumstances, and also assuming we do not walk away dues to home inspection or building code contingencies, we should still have a solid RoI.Thanks to everyone who chimed in.

Hank,Yes that is what I was thinking and it would also give me more breathing room in case of a change in tax or any unforeseen expenses.

A lot of new investors do not plan for unforeseen costs and improvements like paint and carpet or even bigger expenses like a roof or furnace that your property will inevitably need. 

When renting out your condo be sure to screen your new tenant well to make the renting experience better for you and also make sure to really analyze what your monthly expenses are going to be so you can save your rental income for unforeseen repairs or emergencies.

I understand and agree that people need to allocate a standard amount/percentage for unforeseen maintenance and capex, along with vacancy. 

The only risk thing here is that the job turns out to be more than a 1 day event due to some unforeseen circumstances which can and do happen!!!

I don't pretend to know your personal financial situation, but that is a crazy thin margin (if there is even any margin at all) when accounting for these unforeseen circumstances.

@Poem TurnerThe class of tenant you will be dealing with with those rents will surely bring unforeseen headaches.

You could come in with that during the refi, if you wished, and keep that $125k liquid in case some estimate is off or some unforeseen expense comes up during the renovation.

Who knows they may have lowered the price by the entire quote amount of the unforeseen items just to keep the deal alive, or maybe just split the cost...