Many people consider verbal offers binding, so your behavior could be considered unethical too.Just tell the seller what happened?

I feel fortunate, it could be a lot worse, the place looked like it was lived in by people who just didn't care, but no malicious behavior (other than not paying) is involved.

[STATEMENTS ENDORSING BAD BEHAVIOR ONLINE IS NOT WELCOME - POST EDITED]

We are very careful to prohibit behaviors not people.We can prohibit the act of smoking on the property, or at least inside.We don't prohibit people who identify as smokers from renting with us - we just tell them they can't smoke on the premises (however we define that) and then outline what the consequences of violating that policy will be. 

Do you think that behavior was typical of all tenants in that situation or more so those individuals?

EXPECT what you ACCEPTyou have accepted this poor behavior, and there is no chance it will change going forward.

Funny because what you claim to be theory is me describing normal market maturation behavior.

The biggest problems that investors/speculators deal with are:Defining riskManaging riskDeveloped processes and proceduresExecuting the planTo many new investors/speculators focus on activities that have nothing to do with investing, market behavior...

If they see shady behavior (i.e. the space they lease being offered for lease without them telling you they are leaving), you will likely lose good tenants and good will.

Think about it, this is when they are on their best behavior and want something from you, namely acceptance.