I concede that the concepts of accepting a lump sum or a temporary free rent can be construed as payments for a cancellation of a lease.

I pointed out this discrepancy to the sellers agent and they conceded that the cap rate was a proforma cap rate and assumed the additional 3,000 SF was being utilized.That said, I still think there is a great deal to be had here so I put an offer in today structured below:$800,000 "sale" price with 10% down ($80k cash to seller at closing)Seller finance $720k for 10 years, interest only @ 8.25%, with a balloon payment at the end of the term.5 year lock out period in which I can't refinance and a remaining interest payment kicker if refinanced or sold before the end of term.So if the seller accepts, he would get a monthly interest payment of $4,950 for 10 years totalling $594,000. $594k +$80k + $720k = $1,394,000 total.

I suspect you went back to single unit cost on the cost to purchase but used a cash flow from a multi unit.Confusing.I also concede on the large unit counts you could do better than the 50% rule in Cleveland (but not the typically small unit count investor that is just starting out). 

That is one area where I will concede that two AC systems will be more expensive to maintain than one regardless of the size of the unit.  

After 5 years I finally conceded. 

There will be a contraction soon where rents will start conceding.

I also recently had an employment change as I Conceded my 50% ownership share of a general contracting firm.

So the question becomes - are you willing to concede if the IRS disagrees?

I began to branch out from the initial neighborhood I had pinned down and found I either had to concede quality of property or quality of neighborhood at that price point.

In Rev Proc 2008-16 the IRS is simply saying they will concede your intent if you meet that fact set.