Again, I have had to be very firm when I come across this.You could also propose a compromise.

I'm guessing.I also thought this could be a good compromise since if I ever needed to, I could live in one of the units and commute the 2 hours to my office a couple of days a week to maintain some of the income I make locally out here, if I needed to do so.Any advice about this idea?

We compromised and agreed upon getting a 4-plex, living in one and renting out the other three.

It takes both parties to give some compromise while understanding that you are both are on the same team.

A good compromise is to use the thicker grade vinyl that doesn't need to be glued down.

Maybe this is not possible as the business cannot be compromised with compassion but could there be both?  

We do not want to write it up in any way that compromises financing.  

Sure if they have renters insurance they should file a claim, and you can see if you get lucky and they cover the entire cost  also keep in mind that you’ll probably have mold, so that needs to be remidiated by bleach or something else before new boards are installed  Otherwise, since they are a decent tenant, I’d try to negotiate and work out a compromise with them.

Then all your locks are compromised.

The actual value improvement is going to be determined by the referees if the previous owner disputes the value you give them and as a compromise can be determined with an updated appraisal when the owner redeems.