I think this chart is more illustrative of where the economy is going. 

That was very illustrative Greg.

But the word 'HELOC' is traditionally associated with 2nd mortgages on primary residence, so I think, in addition to making some relationships with smaller banks in your community, ask them if they grant homeowners secure lines of credit with the homes as collateral in first position.Remember, there is a thing called a CD Line of Credit - for example, you put 40k in a CD(this is a terrible investment, by the way, but I am doing this for illustration) and then you tell the banker you want a line of credit secured by the CD. 

I was trying to illustrate an example for the OP. 

(all of you full time rehabbers out there can skin me, but I just want to plug in some numbers to illustrate the principle)So let's say you estimate your repairs at 15/square foot.

I can only say thank you for illustrating the kind of thinking that could potentially cause selling agents to not give me a fair shake when they present my offers to their clients.What would you suggest I do? 

I notate the story may not have illustrated how that all came to be in real life but that is not a common way for that loan to be made.  

Depletion is much like depreciation but it is not the same.Everything you listed are improvements to land, including the wire running under the paved parking lot to the light poles.Land is the dirt, it is never under any circumstance depreciated.What is mentioned above is the lease being subject of depreciation, not the dirt.There is only depreciation or depletion under tax code, it is the nature of the tax beast, it is an economical concept as to devaluing an asset arising from it's use which may or may not be a financial limitation or reduction, but done to illustrate the lesser of utility of improvements.:)

The narrative report will better illustrate where and how the analysis begins.

(This was a professional operation and not some mom-and-pop single member LLC, so they had probably done everything right.)I would also say that the case illustrates why smaller investors who manage their own properties or are otherwise actively involved should not over-rely on LLCs.