There are several ways to achieve this though, and you can  check out this article to learn more.The fourth pillar is somewhat similar - you want to separate your operations from your assets.

Risk level is insignificant when you properly operate your business as others have mentioned.

I follow the core/satellite approach to portfolio diversification where the bulk is in very safe/conservative assets which allow a smaller satellite portion to be in riskier.

Collecting a damage deposit is a core task of a PM that you pay for and they either failed to do it, or failed to properly record it... either way, unacceptable.   

@Christa S Rickard I'm sure you could operate at 21% but it suggests that you are on auto-pilot...letting the roof rot of the place with insufficient reserves...I'd like to take a look at the actual property performance if you're inclined to send it over...

(I operate a restaurant) Anyone else start this way?

This, of course, will go far to help you start finding your core team to help you towards greater financial freedom. 

If your budget is constrained - either by the depth of your pocket or the amount of capital warranted by the business case - you will be better off in the long-run to cut-back on the level of finishes (which can be easily upgraded later) and not cut corners the building envelope and core systems (which are much more costly to upgrade after a unit has been finished).

@Mark Gast  Are you planning on living in the property or operating at a pure investment? 

Better Cashflow compared to "Core" Areas How did you find this deal and how did you negotiate it?