My position as GP is justified with work experience being that I invest and develop for years, and for putting the deal together and bringing the unique opportunity. 

Seems too good to be true, but after reviewing their numbers and deals it's a great investment.

If they don't have a positive test, they won't have anything to back up the photos if it tests negative now.

Many investors who are in a similar position in my market (another HCOL/tenant friendly area) choose 1 of 3 options.1.

Great position to be in.

Build an SMB on top of your real estate (the reverse of #2)Short-term rentals and high owner-participation real estate businesses can have great returns.Obviously not for you if you just want passive RE.We are in the deep end here, where each case should be judged on its own facts and merits by your CPA.You should hire a professional to review your particular situation before you make an investment.

If the covenant specifically prohibits renting out rooms or STRs, you may be restricted from doing so.You should carefully review the covenants tied to your property to understand the specific restrictions.

I would need to review the contract language regarding title defects but my bet is it could quite easily be argued that this is on the buyer.One option perhaps not considered -- accept the easement and close cash.

But I agree with @Stuart Udis - when making offers on occupied rental property, I always review the Financials including the RR & T12.

As things with real estate are starting to pick up for me I'm now getting to a position where I could feasibly have more than one project running at a time and am trying to look at options for how best to keep these straight and on top of all the deadlines.