One of my partners is looking into the legalwork and comparing development costs with other contractors. 

Luckily we bought under our MOA and built in high prices purposefully on our Rehab Budget to buy safe.

This sort of renovation will actually be small compared to the one I just finished rehabbing.

As long as it was put in place by a reputable contractor, the quality should be no different when compared to a neighborhood of houses.

(I imagine this would depend on a number of factors, but I’m at a loss on what to compare a USDA-guaranteed offer against.)

I assume your agent ran the CMA on the property and if so, did you guys did compare it with other 3 bed rooms, 1 baths in the area? 

Comparable houses to this house are selling for about 75% of the list price while similar size land plots within a couple of miles have sold for 100% of the list price. even after commissions and whatnot, it looks like a 150% ROI is realistic in just a couple of weeks.

Payments are too high compared to rent. you're over $650 per month before maintenance, property management, capital ex reserves, etc...

I live there for almost 20 years  in the 80s and 90s  and really enjoyed it but was forced to move  for employment purposes .

It's a completely different process for appraising, loan origination, and ownership structure between residential and commercial.Commercial is based off income the property produces, residential is based on comparable nearby properties.