if the operator fails  they can foreclose and unless you paid them off you get wiped out.. what happens is some senior lenders will not cooperate .. need to get that hammered out on the front end

(see @Eamonn McElroy post above) If the laborer isn't the owner or employee of a company you hire then it looks like they are your Employee which means you need at a minimum Workers Comp, payroll and associated taxes to comply with the law - Bummer right?  

My partner is based in Central Jersey and we are looking for a property manager to help manage day-to-day operations as we aren’t super close to the building.

I am told the current owner operated on handshake agreements. 

Currently tenants go off site to do their laundry, I plan on cleaning out the basement and adding coin operated laundry and installing storage cages for the tenants to rent if needed.  

@Kristin Shopp I have partners who operate in Dallas and San Antonio as well as Austin.

rehabbed the trashed studio into a 1 bedroom, made repairs to broken exterior staircases, coin operated laundry room, and fixing up the garage for extra income.

With a projected 5% vacancy rate, and 10% factored in for annual operating expenses, and a conservative $800 per month rent, I'm still calculating a Cash on Cash ROI of 19%.If possible could you provide slightly less subjective feedback, and share with me what you think an acceptable cashflow should be. 

More to the point on this though, was that his dad made some very shrewd investments including buying the building he operated his practice in.

Year-end comes and the CPA will be spending countless hours to fix the financials and bill a huge amount for the work without a reliable person to speak to on what went on during the year of operations.