If a renter has an issue with safety for some reason down the road, and they find there is no certificate of occupancy, it could be bad news for you illegally renting a non permitted dwelling unit.

We screen thoroughly and it sometimes takes a while to fill them but we're patient.

Texas property code requires the owner or PM to make repairs that "materially affect the health and safety of the tenant" in a reasonable time (usually 7 days). 

One of our advisory board members owns these types of properties across the upper midwest and has been developing patient strategies for redeveloping.If your plan is to invest in large malls and lifestyle centers, but not to operate, you should look into REITs that hold these types of assets and are run by operators who have forward-looking plans and strong theses for repurposing them.Good lucking and looking forward to hearing what you learn

No deal is better than a bad deal, be patient.

That doesn't give (stickiness) and more safety to a properties cashflow but instead can insert more risk for the investor.

I know there's not on the market for first time investors but that's why it's worth being patient to find the right one.

I just reassure my good tenants that I’m throwing him out and to stay patient and vigilant and things will improve as soon as he’s thrown out . 

As for the unpermitted master bedroom, one of the ADU/JADU regulations states that only codes related to health and safety can be mandated when converting it to a ADU.  

Unfortunately, we are late in the cycle and the multifamily property types you're pursuing (not just in Denver but in other desirable markets and undesirable ones too) have lots of competition for buyers, often unsavvy ones who are not carefully underwriting their deals and as a result driving up the price per door or family offices/UHNWIs with patient money that can afford to buy at lower short term yields than you or your investors may be willing to tolerate.As investors, we all must proceed cautiously at such elevated pricing:Investment performance relies on strong rent growth and continued low cap rates at refinance or sale.Demand has pushed prices for riskier properties with less upside to unsustainably high levels.