Any sense of if this type of loan structure is widely common or specific to your locale?  

That opens the door wide open for constructive receipt and outright fraud. 

Both of these leave you wide open to later selling a property and then using the 1031 to purchase this property. 

This was a small local bank that held it.The other was a nation-wide bank. 

I don't think you need terribly wide diversification, but betting the farm on a single transaction is a bit much.

Figuring out your expenses is more difficult with this type of property, than with multifamily, because there is wide variation regarding which expenses the tenants pay themselves or get charged back for, and also what services you are providing. 

Additionally there are other tools built specifically to help you cast a wide net with 1 rental listing (syndicating the listing to 10+ listing sites).

You can have a very wide range of service within any given company.

These vary widely and you have to do it EXACTLY RIGHT if you don't want it to get tossed out of court.For example, here in Georgia someone on a month to month can be asked to leave with a 30 day notice.

Typically it is going to cover the properties structure and exterior, but there is wide variation in what else could be covered.