I'm not the fair housing landlord expert but I'd probably steer away from referring to it as "veteran housing"Either way I can relate to your situation a little because I also own a house that is shared by multiple people.

I reached out to RTR, they referred me to another contractor which gave me a bid that would increase the construction cost by 100K - or they offered to buy as is and I would take a 160K loss.It is terrible to fell this dumb!

I think you are referring to Jorge from AHP. 

Does anyone have any recommendations or something they can refer me to. 

The low income versus high cost of living is referred to locally as the sunshine tax. https://www.businessinsider.com/most-expensive-places-to-liv...https://www.census.gov/quickfacts/fact/table/sandiegocitycal...It is my view that the incomes cannot sustain the high cost of housing in San Diego but it has seemed this way to me for four decades and yet the RE prices keep increasing.  

Talk to others they work with and ask for references if you don't know them personally.

When you say the suburbs, are you referring to Jackson, Plain, North Canton, etc?

I refer to Sb13 and ab2533 as proof that the state legislature wants safe unpermitted units to be occupied.  

So I would ask what you care the most about depending on the type of deals you do.I do think checking references and reviews is important as that's sometimes overlooked and some lenders are notorious for switch & baiting. 

Here's my slidedeck on MTRs which is basically what you're referring too.