The tenant fails to pay their last month's rent and leaves the place needing new flooring and paint.

When someone wants to send you a referral privately, they are probably sending you a friend that pays them a referral fee.

While I have not done a deal with them, their agreement requires a close timing that simply will not work with conventional lenders (usually 7 days or so).  

Will it pay the full PITI plus Capex, management fees, maintenance etc?

Imagine making millions of dollars over the course of your career and then having to pay 30-50% every year to uncle sam instead of compounding that cash over time.This is exactly what real estate professionals have learned to mitigate.To reduce their taxable income, they just buy a building every year, do a cost seg, and use depreciation to reduce their tax liability dramatically.Their personal wealth snowball grows much larger and much faster than their W2 counterparts who give most of their money back to the government each year.Following this strategy as a real estate professional is one of best ways to end up with a much larger net worth at the end of your career.

The hang up is getting deals formally drawn up.One idea:- I buy the property and pay 25% DP, then they provide capital after the closing and I pay them P&I over 5-10 years.

I would rather invest in safe markets that produce a good return, then I can use that income to pay for a vacation anywhere in the world.I'm very pessimistic about the STR market in Hawaii.

Right now, the best offers around me are for some 1.3-4 million, that only generated around 100k per year gross, so there would be a high chance of not cash flowing, and paying money, especially with a commercial loan (these buildings have more than 4 units).I was thinking that although the rental itself does not generate money, I would be able to deduct the mortgage interest, and depreciation from my personal w2 income and would be net positive.

@Shayan SameerThe non-paying tenant could impact your short-term cash flow, so consider the potential costs and timeline of eviction in your state.

. $1300/month, tenant pays all utilities. 4 bedroom one is vacant.