Our best workers become part of our "team" and we let them know we value them by speaking highly of them, complementing their work, and treating them to lunch, or tickets to a show, or even paying for a professional massage or trip to the dentist from time to time.

I'm VERY comfortable with numbers, they're easy to work and massage.

After a little massaging, the city has given the current owner a permit to improve one of the apartments, but not the other.  

4 of 7 rooms are already rented consisting of hair salons and a massage therapist.

But despite those numbers, it sounds like you're just trying to force this one to work by massaging it a bit - which is usually an indication that you should move on.

NEVER AGAIN, but I have learned a lot & massaging them is akin to poking a sleeping dragon.

You have the right to refuse to rent to people who you refuse to make their intentions clear, or refuse to people who change their story.We've had several situations exactly like the one you described where a restaurant owner rented an apartment for employees and we've have a few where massage parlor owners were using our apartments for prostitution and we had serious problems every time.I would not go as far as taking the rental off the market, but you may feel better documenting every conversation, text message and picture.

Early on I started out with a 20 unit multiple property C-class seller financed deal and it almost bankrupt me as I didn't do my analysis correctly.It's great that the seller is willing to hold paper but be sure you aren't massaging the numbers to create a better deal than what's really there and be especially certain you have sufficient cash reserves to tackle a project of that size even if it's 100% financed.  

I am sure he probably still needs to massage the numbers a bit but better than excel spreadsheets and a box of receipts.

Niagara Massager shower head.