The thin margin is precisely what I am concerned about, but in reverse of how you're describing it.  

TD was also making noises of doing the same, but I'm not certain if they ever put it into practice.The problem you will encounter with a small commercial property at most tier-1 lenders (Big-5 banks, and major credit unions) is the commercial lending department is not particularly interested in a property under 1 - 2 million  ... leaving you in no-man's land {which is precisely why RBC started handing 5-6 unit properties as residential}.Once you move to commercial lending, you run into more costs - things like originating fees {like you hear about in the U.S.A.} as you are paying the lender's legal and administrative costs.  

Thanks for the precise answer!

Well I am going to give you precisely the opposite advice of these guys.

Because in most markets where people expect great appreciation (or depreciation) in real estate values, there is inherent volatility in that market for the precisely the same reasons as anticipated price movements. 

Over time and as you scale to more properties, you get closer to the averages but single properties will have significant variability.It's so much easier for me to buy value adds and force appreciation and have large cushions against precision in underwriting a deal.  

See then if you can formulate a more precise plan for building longterm wealth.

Now, I understand that many people don't use accurate numbers when asking a question on a public forum, but I feel that doing so will help the BP community answer my question more precisely. 

That's precisely what I am aiming to do.

This is precisely why Cap rate as an indicator of the worth of an investment opportunity can be very misleading indeed!