Out of the remaining 8:  2 didn't pay or communicate, 2 are on furlough and paid half,  3 paid in full and 1 unit is in the middle of reconstruction from a fire.   

The property I'm working on now was so badly damaged we actually had to tear some of it down (to dirt) and reconstruct it.So, that said, I would do the deal if it's fixable but I'd write the offer for them to fix it and you pay xxxx amount or you fix it and pay xxx amount.

I know someone who is in reconstruction after disasters and definitely states this is where the money is.

Reconstruct yourself.

Also, would be interested in the age,square footage,and materials as a reason for the discrepancy between appraisal and reconstruction cost.People complain to me about reconstruction estimates on brick row homes, but to replace it at today’s material+labor prices (massively inflated and not at the bulk scale as when they threw up blocks of them) as well as bring it up to code (assuming Ordinance and Law Coverage) really is different than market value.

Hartford, typically- is a time intensive, managerial headache. lets just say that the reconstruction of everything went nearly perfect.( Which if your first decision is to skip the professional planning process. seems highly unlikely. ) Anyways lets table this thought for a moment.  

I sell implants used in Trauma reconstruction.

Second I look at reconstruction cost per-sqft in comparison to market price.

Here are the Fannie Mae guidelines for legally non-conforming properties:If the Property's characteristics are legally non-conforming, you must:ensure the Borrower executes the Modifications to Multifamily Loan and Security Agreement (Legal Non-Conforming Status) (Form 6275);confirm whether, if fully or partially destroyed, the Property's Improvements can be fully rebuilt to the pre-casualty condition per current laws, zoning requirements, and building codes; and if the Property’s Improvements cannot be fully rebuilt to the pre-casualty condition, evaluate if the as-rebuilt Property will support the Mortgage Loan at the current Tier, and document your analysis in the Transaction Approval Memo.To assess the Borrower's ability to rebuild Improvements on a non-conforming Property to a level that will support the Mortgage Loan at the current Tier, you should consider: conducting a threshold analysis to determine the resulting actual amortizing DSCR if the reconstructed Improvements cannot be rebuilt as-is per current law; the likelihood of a casualty event (e.g., wind, earthquake, fire, flood, mine subsidence, etc.); the percentage of damage to the Improvements at which the Property’s jurisdiction will require the Property be rebuilt to current zoning and land use requirements (i.e., the destruction threshold); which Property characteristics the destruction threshold percentage applies to, such as market value, assessed value, replacement cost, or unit count; for Properties with multiple buildings, if the destruction threshold percentage applies to each building, or all buildings as a whole; the replacement cost to rebuild per current requirements for zoning, and land use; the Property’s continued marketability, and economic viability; the amount and type of Borrower-maintained insurance coverage required per Part II, Chapter 5: Property and Liability Insurance, Section 501.02C: Ordinance or Law Insurance; insurance loss proceeds payout, compared to increased rebuilding costs, including from building code changes, Americans with Disabilities Act compliance, and the municipality's local zoning requirements (e.g., green compliance for new buildings, etc.); the sufficiency of estimated insurance proceeds from ordinance or law insurance and other coverages to repay the Mortgage Loan in the event of partial or full casualty, or condemnation; and for a Tier 3 or Tier 4 Mortgage Loan, if requiring execution of the Limited Payment Guaranty (Form 6020.LPG) would mitigate the risk of the as-rebuilt Property not supporting a Tier 2 Mortgage Loan.

All he required was the correct amount of insulation and no further reconstruction to bring the property up to code.