You will need a LLC, EIN Number, Operating Agreement, etc. 

I think his 12% may be referencing his multi-family that he owns and operates, unless he's not able to pull out all his funding.

However, I don't understand how buildings are financed when the net operating income will not support the mortgage payment.

If that was my only commitment, I doubt I could 100% comply with all state and federal laws and rules. 

It is your responsibility to resolve the problem caused by the annoying smell.Ultimatly if they do not comply you may be forced to issue a order to comply and either let them out of their lease or evict if they do not comply.If they refuse to comply they change from good tennats to bad tennats.

State law probably specifies minimum notice required, and if lease was done by a RE Agent or Attorney, would guess it complies with applicable state laws.  

In the U.S. you might be in the highest tax bracket and you would owe quite a bit when you sell or if you don't comply with a 1031 exchange or make one happen. 

My current model, as an owner-operator, accounts for my time - here's how:  Each new tenant signs a list of repair estimates they will be charged for various turnover expenses as well as labor at $25/hr for anything not listed. 

Provides Operating Agreement.

We should all happily comply for the better good even if it means going broke and losing our assets .