The tax expense is not strictly pass-through in that the tenant is paying a fixed rent that didn't take a pro rata property tax in consideration.

We use “CAMs” for MHP and split the w/s bill up pro rata for each occupied lot regardless of head count.

Are you saying that they'd get a guaranteed straight 6% return of their invested capital annually regardless of the profitability of the project plus a pro-rata piece of 30% of the actual profits?

* Another, perhaps far-out option, & borrowing from the “Using a 1031 exchange to fund a buyout” thread:Take title for RPL1 (potentially & RPL2…) possibly using a Land Trust along with non-prohibited entity and with proportional ownership, then acquire pro rata interest as RLNs liquidate.Thoughts?  

I noticed, there wasn't a mention of deposits, that's why you have an estoppel agreement, signed by both the tenant and the landlord.if the closing company failed to collect the pro rata portion of the rents, they are responsible for them directly.

Who handles operations, how are disputes mediated, how do you handle selling ownership interest (or handling death/divorce), do you have pro rata ownership interest, is there a management fee, etc. 

If the lease is terminated, the tenant is entitled only to a pro rata refund of rent from the date the tenant moves out and to a refund of any security deposit otherwise required by law.

Once you are renting out the rooms out you will get to use the mortgage and expenses as deductions pro rata against the income, possibly even some depreciation.

You may also have to come out of pocket at the closing table for the buyers' pro rata portion of property tax and other seller prepaids but that is not technically a closing cost.  

I would ask the PM to ask for specifics about what they feel is damaged and what the pro-rata request is before you make a decision about compensation.