I think it's still the case here in Charleston County that you can add an accessory dwelling of up to 800 sqft as long as your lot meets certain minimum lot size requirements.  

If anyone knows if it can be done on either a conventional loan, fha loan for a triplex, or would a portfolio lender be the best bet?  

Sites like Zillow and RentOMeter say that my ask of $1400 for rent is near the top of the market for the area, but still reasonable for a unit of this size - and that is even without the basement.So does the basement effectively get thrown in for free?

The current owner is shopping it around for 1.35m (7cap) and the proforma numbers are as followed: ANNUALIZED INCOMEActual MarketGross Potential Rent $191,639 Less: Vacancy ($5,749) Effective Gross Income $185,890 Less: Expenses ($91,497) Net Operating Income $94,393 Debt Service ($65,592) Net Cash Flow after Debt Service $28,801 Principal Reduction $17,403Total Return $46,204 ANNUALIZED EXPENSESActual MarketProperty Management Fee $9,582 Replacement Reserves $5,250 Building Insurance $6,712 Maintenance $12,560 Taxes - Real Estate $36,296 (37220 w/o exception)Utility - Electricity $2,453 Utility - Gas $12,369Utility - Water/Sewer $6,275 Total Expenses $91,497 Expenses Per RSF $8.39 Expenses Per Unit $4,357I did some additional digging and found that they offer Wi-Fi for the building (I talked to a rep and said providing service for a building that size should run 285 a month) and the trash was left off which runs about 285/month.

When I met him face to face, he said I bet your surprised to meet a Chinese guy with an Australian accent.

Define size of each market segment - Number of units sold, dollar values, absorption rate (avg. time it takes to sell)2.

Granted, this 5 unit will be a much larger project, but the size & cost of the project is what's making my other partners a little apprehensive about this property. 

.- assume 100% chance the sellers wont do anything. i am betting a pizza on it and i hate betting!

The judge may have ruled your tenants have to pay back the court fee but it's a fairly sure bet that they are not likely to do this. 

Off market is the best bet, but of course that takes more work.