Let's say, as-is, it could have been rented for at least $400 more per month?  

I would say as long as your debt/income ratio would still allow for a mortgage, keep the cash and the loan and use it to put down on a house.

Second would be....What's the rent difference between the full 1200 sqft building and say a 1 or 2 bedroom 749sqft for the area?

Is this truly the case even with say a 40% down payment?.

Or, do you think there are also opportunities in say, a Class B- unit that would run somewhere around $120k-$150k?

So for example, one can buy a 5 cap, and after all expenses related to a condo conversion are accounted for, one can have say a 15% profit margin. 

I'd say a 6% increase is over the top and mom and pops can move.

I'm a transplant from Canada, moved here (Bay Area, CA) about a year ago, and taking up permanent residence in the US.I have an investment property and other things (i.e retirement accounts and so on) back in Canada, looking for a CPA here that can help me with the straight forward stuff (filing taxes every year and so on) as well as advisory from time to time (whether it's dealing with cross border strategies to minimize the tax bites, or the same with US investment properties).I have an accountant in Canada as well so this person doesn't necessarily have to be say, a CGA/CA or whatever in Canada as well (but super bonus points if they are and can do both my US / Canadian returns!)

After you pay down some or see rent growth and appreciation you can refi several into one commercial loan (say a 10 year fixed).

I'd say a dozen tenants is small...go for it!