It has an upstairs balcony door to the outside, and could potentially be converted into two units.

Managing contractors out of state, especially if you don't have construction experience, is risky.Once you build a team you trust in a market, then strat to take higher risks 

It can come from a personal investor who will negotiate terms, or potentially a piece of the equity.

Once you go with a minimum 6 month lease your turnover costs, potential damage, make ready costs, repainting and repair costs, all go down dramatically.  

The amount you would need to report as potentially taxable gain is total insurance proceeds less your adjusted tax basis in the property (your mortgage doesn’t get considered into this calc). 

I started with a single-family home and it gave me a solid foundation without too much risk.

I plan on starting out next year with a small plug and play solution to have minimum risk.

The restaurant going under is definitely the biggest risk.

I’d love for you to teach me something new.Last semester, in the Risk Management & Insurance Planning course I taught, we did a deep dive into IULs, analyzing policy illustrations to examine the risks, upsides, and downsides.

It will help mitigate some of the risks that you are hesitant about.