Something that is imposible using a buyers agent. 

Don't get me wrong, I've closed a few of these (in these cases the appraisal report came back only a bit different from what the agent/buyer described), and had a bunch die after the appraisal came back (when the report is VASTLY different from what the agents/buyer said to me, which is the norm), but due to systemic unreliability of information my position is that the price of a definitive yes/no is an FHA appraisal fee.Make sure you're working with a lender that isn't artificially restrictive, get it under contract, and get an appraisal going.

Restricted to “reporting” any repairs $400 or more.

Constructive receipt is funds under your control with no restrictions. 

Are there restrictions/regulations on what an owner can do to a commercial property?

From the FHAA Federal Housing Authority:[Landlords are required to accept ESA requests] unless doing so would impose an undue financial and administrative burden or would fundamentally alter the nature of the housing provider's services.

There may possibly restrictions in the note you owe. 

Go to your local community bank - they may lend based on fair market value with no value seasoning restrictions.

Maybe the city liked that income and therefore didn't impose any worse penalties?

Proposition 13 and its restrictions.