This destroys that logic and I will lose a lot of money.

My criteria is pretty simple - with 10 to 20 percent down, can I manage the property and not lose money and will there be reasonable (or better) appreciation over the next 5 to 20 years? 

Is it worth it to tell the property manager to just delete the tenant's debt so the owner doesn't lose out on the late fee?

It's lose-lose for those that own the condos.  

My mortgage would go up $781 for the next 30years,  the ADU income would more than cover & I hope to pay extra principal to cut my loan time -it's just I was hoping to pay off ADU within 5.5yrs- so that I can collect 'all' ADU income at that point <I'm fixed income & I lose 'some' personal income in 5yrs so trying to plan ahead on how to recoup that>.

The other bank didn’t want to “lose” our business and told us that any property where the LTV was 50% or less wouldn’t require personal guarantees in the future.

NOTE 2: if we choose NOT to upgrade the rooms, the units can't be in the hotel's pool of units to be rented out to guests.NOTE 3: right now, I'm losing about $1,500/moMy gut tells me to just get rid of this unit at a loss but I have a few questions I'm hoping someone can help me with (so far, I've asked some RE professionals I know but they don't have any idea).1) If I was to pay the ~160k for room renovations, does this mean the room increases value by at least that same amount? 

Because you're going to lose one tenant due to the actions of another tenant. 

So, I am staying away from suggesting that, otherwise I will lose the friendship. 

It may take several months to find a deal in either location, so you've got nothing to lose but time, yet a lot of experience will be gained.