The fact that your property is rented quickly at the highest rental rate in the neighborhood has little to know impact on the appraised value of the property.Apartments are valued based on Net Operating Income (NOI).

Additionally I am sure there are huge possible liability concerns if the tenant is injured while putting up the hurricane shutters.There are many different types of Hurricane shutters from the panels you fit and tighten, the accordion, roll down for sliding glass doors, and impact windows.Depending on what story the window or door is located on and your budget will ultimately determine what hurricane mitigation device you choose. 

I prefer a cushion with a positive cash flow - which impacts how much I am willing to pay for a property.  

A few quick examples.Monthly payment is $1,000 and rent is $1,000....a lender sees this as -$250 a month on your debt to income ratio.Monthly payment is $1,000....rent is $1250...this is even and will have no impact on your debt to income ratio.If you have a DSCR on the property greater than 1.25 then they will consider this as more income, and it will increase your borrowing capacity for your own home.

Does the delay impact your plans with the property?

Even if that doesn't happen it sounds like flood insurance will get really expensive based on the chance of that happening.A friend that used to live in Cali said with cliff type areas a rise in seawater will not impact as much as the beaches.I know the rising water for a big impact is a long time off but it seems risky also with earthquakes and fault line.I am just an outsider looking in though.  

Also, I'm surprised that your property did not have a reputation from the student body, which would lead to an easier time finding tenants.

It may be wise to seek an attorney to begin an action for breach of the lease agreement, while seeking out new tenants.You should not operate on any advice I just gave, as special considerations in local law may impact your particular case.

The real impact to REI will be interest rates rising...

If you do end up selling it as a business investment adding $300 a month to the cash flow would have a large impact on what it could sell for.