For instance, the upper unit has 53.5% ($695K divided by $1.3M) value allocation of the entire building.

These are generally Not Fixers - Most sellers in this situation either:1) have to sell quickly or 2) don't have enough equity to cover real estate fees, closing costs and other fees or3) don't want to or can't afford to do repairs and or don't want to have people traipsing around their house or4) have bought another place and are carrying two mortgages or5) lost a job or have a medical emergency, etc or6) are in pre-foreclosure and have to do something quickly or7) are inherited with a mortgage and can't make the payment or8) have a job transfer and need to sell quicklyI allocate $25,000 per property.

This will be easier to control the work, deals, profit allocation, getting rid of investors versus a partner.If you do get a partner the key is how do you both exit. 

It allows investors to "write-off" the value of the purchase allocated to any building or structures as a tax deduction to help offset revenue.It does not apply to a primary residence or a second home.

These investors though have extraordinary wealth in the hundreds of millions so they allocate a small portion of their portfolio investments say 50 to 100 million and get 80% ltv loans and put 20% down.

That means I would've been on dumpster swap #4, putting me right around $2000 with $0 allocated towards labor.

How would you go about allocating these funds.

You could easily have found 2-4 value add investments and allocated portions of the sales proceeds added to leverage in your 1031 and ended up with a much higher COC return. 

Flipping houses or renting out property is not like mindlessly allocating 5% of your salary to an IRA.

Account Closed do I see $700 allocated towards GC quotes?