Maybe that is gross profit when you sell it, but what about the cost to build it?  

Build a strong team of local agents, property managers, and contractors, and reinvest profits to grow your portfolio.

Without a firm base and working familiarity with these three areas the investor will not have the knowledge to analyze, negotiate and close advantageous real estate transactions. 2- Experience - the first few deals are likely to be smaller, harder, with more “surprises” and not as profitable as the investor imagined.

And even if I do not get into the renting business I can make some profit if I decide to sell the property at some point.

What you'll find is that the better sponsors are likely to have a lower return to LPs because they present less risk and are rightfully keeping more of the profits for themselves. 

Let's say things go wrong down the road, any profit from the Wrap has been spent of course, the DOS gets called.

He should be digging his heels in every day to make his investor profitable.

What about having to break even, or even feed the property every month $200 for those same 36 months, but at sale, could net a $75K-$100K profit?

They need to add 25% in order to get the 20% for  Overhead and Profit.

This means it can be very profitable if you buy at the right time, but can be brutal if you buy at a peak.