As an architect and now investor that lived in Ontario, this kind of well designed renovation project ticks all the right boxes

Hey @Mario Morales - I've had some experiences legalizing basement/garden units in Chicago.If you are planning on trying to legalize it as an additional unit or ADU I would recommend first connecting with an architect if you haven't already because there could be other issues that don't allow you to legalize it like ceiling height, light & vent, etc.If that's the case I would just rent it out as is and not worry about the 2nd door...as I am sure you know it's pretty standard in Chicago to rent out non-conforming garden units.

Here are my favorites: True Built ADU's start at $139/sq ft but you're completely on your own for permits, site planning etc. https://truebuilthome.com/home-plans/adu-homes/Greenpods range from $180-$300/sq ft http://www.greenpoddevelopment.comStillwater homes are fancier and range from $350-$400 but their price also includes a project manager, architect etc. http://stillwaterdwellings.com

I am an architect in NYC and have seen it all, they can make or break any flip/deal as far as I am concerned.  

Also, if you know any reliable builders or architects who specialize in such projects, I'd greatly appreciate your referrals. 

Because of the larger down payment requirement for 3-4 unit properties and the limited (and expensive) inventory, it seems that we'll likely end up putting 15-20% down on a duplex.We're willing and ready to put sweat equity into a property if need be - my fiance is an architect and able to do most work on his own.  

They will be able to give you an idea of local construction costs and be able to help you find an architect/engineer to design your project.

I'll put on my landscape architect cap for a quick reply:Sawcut out & remove the asphalt at the bottom of the steps and in front of the deck, at least 2.5' in front of the deck if you can.Add a piece or two of flagstone or pre-cast rectangular stepstones at the bottom of the steps.

Also architects and engineers will need to get involved up front.Long story short, development requires capital basically from the word Go.  

I would consult with an architect who will know more than me.