A partner and I own a warehouse in a small market that we're interested in converting to self storage, but it's in a "mixed commercial/residential" zoning part of town, and the only zoning classifications that are permitted to build self storage per their code are the purely commercial zones.

Don't assume you will get a 5 bedroom septic permit.

I ran a check on one of my prospects for the office space and the service returned as 'Decline' because of a criminal record on file that happened 22 years ago for possession of a control substance.What would you do in this case, for a residential customer I would have simply declined , but for a office space , with small enough rent, should I take a risk of rent it to him?

I want to do a rent/lease to own for a prospective tenant and I'm not familiar with the process and structure of the deal.

So I should check with my county to see about getting a permitted apartment on the property, abide by those regulations, then FHA would recognize the property as a duplex/multiple family or whatever was approved by the county?

For example, the more investors like the economic prospects of a particular market the more they are willing to pay and the lower the "market" cap rate goes.

Unfortunately, the prospects of buying it at a discount aren't great. 

.-2.5 months organizing and waiting for the city to approve drawings and release a permit: I learned the Durham city rules and what they were all looking for in this type of full renovation project and how important it is to have a full set of engineering prints made up asap after buying a property-2.8 months of waiting on contractors to pass inspection: it amazed me how many contractors don't bother to show up to meet the inspections guys when they come out, so there was a lot of this is what it says on paper, but the real problems were not getting fixed, this resulted in a lot of failed attempts to be inspected.

Does anyone have a checklist they can share on number of reports/permits I would need to get at different stages of construction?

Depending on whether it was done legally with permits depends on whether or not a lender could count the income from it towards your income (to help you qualify). 2) Trulia, Zillow, Realtor.com, and many of the other listings sites are pretty accurate.