I immediately ran into an issue - I'm a research analyst at a global Asset Management firm and our compliance department restricts me from having any ownership in a company that issues securities or receives outside investments.

A single violation of any of the provisions of this addendum shall be deemed a serious violation and material non-compliance with the housing agreement.It is understood and agreed that a single violation shall be good cause for termination of the housing agreement.

I have title insurance the so the insurance company is dealing with it.. its a full blown lawsuit.. and outcome is not assured.2.

Rest assured, if they do/did that , then they would be making up that lost profit somewhere else, probably in the management, so the "investor" would end up paying it (and very likely more) one way or another ... 

With regards to advertising legally considering you hold a license, check directly with CalBRE about that to ensure you are in compliance.

The second gym will assuredly drain clients and income from the first, weakening their business - and their ability to pay rent.It also shows bad faith to other tenants.  

Typically they allege a due process violation (i.e. lack of notice) or lack of statutory compliance and ask the Commissioner of State Lands and/or a court to set aside the sale.

Overall the owner seems to have planned this rehab with the codes in mind... should be close enough to compliance, with maybe skipping stove/oven and settling for a countertop electrical appliance insteadCould it be done without rezoning... or is that a no go and I better forget about renting this basement separately?

That means there are no additional compliance costs other than the LLC annual reports etc. 

Room additions, structural modifications, or other alterations or repairs made without necessary permits or not in compliance with building codes in effect at that time"You might not be able to charge extra money for the addition but you should just chalk that up to lessons learned.