Here the building is affordable and rents are comparable. 

Sounds like you did a good job of comparable, see how the process goes.  

The downside is (1) compared with residential, comps used in appraisals are nowhere near as accurate, so the income approach is heavily relied on, which can produce huge swing in “valuation” depending on cap rates, interest rates, revenue swings, expense costs.

This all depends on your goals, but comparing just the two options you describe, I think in most cases the 10 yr fixed would be better.

I use RentoMeter, as well as our own system to compare with other homes in the area.

The work load is extremely low compared to renting by the room. 

If I can get a comparable rate it would seem like this is the best route for me which would allow me to do a cash out of about 300,000 ( 80 %) of my built equity from my understanding. 

One should compare apples to apples by doing a cash on cash and IRR rates of return.

It would be best to use pictures taken of the property when it was being sold or any images you may have taken prior or during closing and compare them with the new pictures.

Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers.