The rents from the acquired building allow me to pay down the HELOC at an accelerated pace. 

You should have zero chance of zoning to residential if the property is right in the middle of a commercial zone.

These issues fall somewhere in the middle not terrible but not minor. 

In the southern/middle part of the country you can get into a great area for under 300k.

My wife and I went as far as putting a fence down the middle of the back yard to separate the spaces. 

One question comes to mind reading the "hire a PM to scale easily" vs the "PM yourself with few units", and maybe it's from my service business background, but it seems there is a middle ground that hasn't been mentioned.

Now, I'm looking to venture into real estate investment for several reasons:Diversify my investment portfolioBuild generational wealthLower my taxable incomeMy Investment Criteria:Buy and Hold Strategy: I'm focused on long-term investments.Cash Flow: Not a priority for me; I don’t need the income from these properties, even in retirement.Acquisition Pace: I plan to acquire one or two properties per year.

Maintenance issues, broken toilet in the middle of the night, blown HVAC? 

I have closed on one deal and we are in the middle of the renovation process now.

My personal goals focus on appreciation, so I'm okay with making minimal positive cash flow in an area that is appreciating quickly, even if rent rates are increasing at a slower pace.