If you have equity and decent credit, a conventional Fannie Mae HomeStyle (or the Freddie Mac version) would likely be the better option instead of an FHA 203k loan (which will require a 3rd party HUD consultant to oversee the deal in addition to having the contractor involved). 

The high end is the 20 or so co ops on 5th Avenue or Park Ave (one is on East End Avenue) that require liquid assets of $100 million + to gain board approval.  

The property required a full gut rehab as it had been vacant for 15+ years.

The vast majority of properties at their available prices will not meet this requirement.  

If the LLC and its income are entirely outside California, it typically does not require registration with the California Secretary of State (SOS) or payment of California Franchise Tax Board (FTB) fees, even if you reside in California.

It's a more involved discussion that requires one on one communication and no, joining a "community" does not prepare you.

If you eventually convert the property to your primary residence and later sell it, the taxes would be prorated based on the ratio of time the property was investment property.These items should be addressed and discussed with your tax and legal counsel to ensure that the exchange is the best course of action given the restrictions and requirements. 

The real prohibitive costs come from the legal, compliance, and reporting requirements of registering a security.

This attorney should handle creation of your PPM and state filing requirements, but they do not handle the PSA or closing. 

A partnership requires three things to be successful - Experience, Capital and Time.It looks like you have the capital and experience but maybe not the time.I have my doubts about this working if you have a friend who has weak credit and a limited cash flow.