*MOST* of the time, unless you have something that's a maintenance or operations nightmare (i.e. you're driving a 10 MPG Hummer), the cheapest thing you can do with cars is keep the ones you have until the wheels fall off.

This was a really good reminder that we need to put together some sort of operating agreement and some other policy paperwork as well but I'm not sure where the best place is to start or should we just get a lawyer?

The broker was initially trying to close the business portion first by 1/15/19 (which I think is why my father in law agreed to the transition date of 1/1/19) where the ABC license would close later and the new owner would just operate under a temporary permit or something along those lines.

All great advice.Follow up question... do you prefer to work with one-man operations or companies and why?

Small operation the Property Manager will know you as well as all of your tenants personally.There is a trade off though.A big company is a proven entity whit proven policies & processes.

It currently costs me around $1,000 just to own and operate while it is at full occupancy.

I’d run like a bat out of hell from a lagoon or a water treatment plant , though.Again, it is best to get some input from an experienced operator but consider this:  if a newbie who has just been reading books and listening to podcasts can pinpoint red flags, you know that’s a deal to run from.  

Develop an operating agreement that spells out the purpose of the LLC who has what role, who makes decisions, how are differences between the two of you resolved and an exit plan.Have an attorney draft up the document so each party is protected.  

Under the provisions of this section, each accessory dwelling unit shall comply with local building code for detached dwelling, as applicable, and all development standards contained in Division 3, with the following exceptions:1.

Not to mention you can scale infinitely with a Series LLC.You can also set up an additional traditional LLC on the side to perform your "operations" that would separate the liability for operations from your assets, or properties.