If you will be forming this corporation/venture with more than 2-3 partners, your are wandering into the realm of the securities folks and you will absolutely need the services of experienced counsel. 

Also, in the event there is damage to the premises that the current owner is not aware of, how do I know what the condition of the property was prior to the tenants moving in or if they are trying to recoup their security deposit by claiming that the damage was there prior to the tenants moving in?

No, but I once had a someone break into one of my properties by pulling the power meter in order to bypass a security system.

Pitch your development to potential customers and just make sure the lease language has a poison pill that will let you out if the project doe snot secure financing. 

Sounds like you did your due diligence and secured a deal you're happy with.

Hi Tiana --  My LLC has a couple of business loans secured by rental property. 

In terms of improvements on the property, I had a wrought iron gate/fence installed, security cameras, and glass shower doors.

This is important because realtors keep their job security by forbidding access to the MLS. 

Accept no money from this idiot and be sure to have any correspondence sent to your attorney .

Here is a breakdown of the items they saw that needs attention.Needs minor trash removal; needs mownSupport post trim needs replaced; badly deteriorated; upper trim needs scraped and paintedBroken panes on side back needs replacedReplace fixture on front porch; flood lights on backNeeds some minor trash removed and minor work done220 wiring needs secured;not up to code, needs to be placed inside conduit.Install new furnace filterClean and paint register ventsInstall apprx. 4 door stopsFull interior rent ready cleaning required after all work completeReplace as needed to match all light bulbsSteam clean all carpet; sweep and mop vinylReplace missing storm door, paint interior doorPaint all wallsPaint door; interior shows signs of previous leak, but doesn’t appear to be a current problem; paint interiorSeal gaps in side window; paint all; seals appear damaged on double pane windows; may not be an issueReplace screensInstall two smoke detectorsInstall two blindsTouch up, as neededPaint all window sealsSeals appear bad; paintInstall screenVery old and drawers fall out; should be replaced with new; secure handles, if keptHas several large chips; functional sink otherwiseInstall two strainers Install fire extinguisherPaint side exit doorEstimated cost is $4,000.