My municipality is demanding changes which, in essence, is turning my project into a new construction project and I am going broke with two mortgages and no tenants. 

We have two young men who are our only candidates at this point, and one of them is a construction worker who smokes.

He will/should ask you to share your short- and long-term goals with him so he can help you construct a plan that will enable you to achieve your short-term goals and reap benefits from those goals that will provide you with the proceeds and resources needed to pursue and achieve your long-term goals.

Look up "constructive eviction."

2015 LOW INCOME HOUSING APARTMENT CAPITALIZATION RATE: 10.0% The Appraisal District is giving public notice of the capitalization rate to be used each year to appraise property receiving an exemption under Section 11.1825 of the Property Tax Code for Organizations Constructing or Rehabilitating Low-Income Housing: Property Not Previously Exempt.

Susan Winderman my bank offers a construction loan for investors, it's a conventional loan it includes rehab costs as well.

Specializing in Residential, New Construction, Commercial, Investments, Foreclosures, REO's and Short Sales.

He'll be able to help you construct a plan that will enable you to reach your short-term goals and reap the benefits you'll need to have the resources available to pursue and achieve your long-term goals - it needs to be one master plan.

Do you have an engineer on staff that's familiar with industry standards that supervises the construction?

Then, you would have to start the labor/construction.