The building has many open violations, mostly due to the abandoned store fronts and to water leaking into tenants apartments from the roof. 

The only catch is the HOA is $260 a month plus $65 hazard insurance plus $200 cap for utilities water and lights, internet comes in HOA dues.

We like to put 6 feet of ice and water shield on our roofs instead of the typical 3 feet when we install a new roof for this reason.  

Any suggestion on water properties vs not on water?

That said, with the limited information you've given, there is still probably some meat on the bone.I can't do accurate math for you because a lot of it is very case by case, but major expenditures you should add in are vacancy, roof, HVAC, property management, and any concessions you give tenants such as free water, cable, yard maintenance, etc.

Not sit around and paint with water colors or join your local golf course, but then again, you can if you want. 

You have to know what your are going to do for water and sewer.

Second, I was concerned that they would move out and take the oven/water softener/light fixtures etc. with them and say 'those weren't part of the deal'.

For example, if I can run water/sewer and electricity out there, insulate the walls, add some windows, drywall, finishes, and appliances for $30k-$50k, that's less than any unit you could buy anywhere in Portland.  

Some of the issues brought to our attention by current tenant would need to be addressed by the seller before acquisition.There is a potential piping issue or cracked pipe somewhere as the tenant complained about some water level problems.