But for large multi-family, that amount hardly covers your legal fees for one transaction, let alone down payment, due diligence costs, lender fees, other closing costs, etc.

I'm not sure I would get to cute trying to squeeze every time out of it now with a lease that might cause you issues in the future, but the scenario you describe is common and probably smart. 

Our main issue is these properties are owned in an LLC.

And also that rates are just going to continue to be an issue, so it's likely something to plan for in rent rates and/or overall investment costs. 

The most valuable lessons are issues that stop you in your tracks and you devote time and effort to solving them.  

Premiums in Iowa, Minnesota, Montana, Utah, and Washington jumped by more than 20 percent.The insurance situation is especially serious in California and Florida.In 2023, around 7 percent of realtors saw deals fall through due to insurance issues, with the share jumping to 13 percent last year as of October, according the California Association of Realtors.

Since Landlords are going to be monitored even more now with the price gouging issues surrounding the fires in LA, I would be extra cautious.

We never fixed the issues, we didn't.

3) If their handyman can't handle a repair issue and they have to hire outside contractors, many PMC's will then charge a markup for their time - but they don't tell you this upfront or disclose in their management contract.

Usually if you have several accounts and investments with 1 bank they will provide you with low to no lender fees and the better rate.The main issue here is that there is a lot of time/effort spent looking at your financials and documents to make sure there are no discrepancies, qualifying you, and sending Pre-Approval Letters, for you to just go with another lender that is offering you the better rate/fees.