Seeing that you already put an offer on the table at 170K, I'd say stick with that if you feel that it's a great deal regardless.

Besides leaving the deal on the table, what other options do I have?

Electricity is split out by tenant, but domestic water is not.

Both partners have enough cash to bring to the table for 50/50 equity as far as acquiring first 2 properties.  

If you're only finding deals that your buyers want, you don't have to "test the waters" first to see if they'd be interested...you can go ahead and get it under contract immediately because you already know you'll have someone to buy it. 

Do any of you happen to have a spreadsheet that will calculate a particular tenants portion of the water bill considering the number of days they have occupied the unit?

@Justin R.Expenses (monthly)123 insurance 230 taxes145 water/trash65 gas55 vacancy275 capex 125 maintenance40 pm software1088 fixed expenses740 debt pmt

Are there separate meter for electric, water and gas?

The exit strategy worst case scenario determines how far under water this building really is in today's market.

I once knew of a situation where a tenant who had their water cut off ran a water hose with dual female couplings from their neighbor's house to theirs at night and fed their house with water the neighbor was paying for, until the cops caught them one night.