The numbers currently make sense but we are concerned with the potential Health risks as well as how this could effect us being able to rent the units in the future or selling  the property a few years down the road.

This legal description is what will define the new parcel on any future deed or contract.

Personally I'd probably professionally and respectfully point out that she is full of BS and ask to see the quoted law she is referring to for your future reference....then let it go......take the partial payment, and start marketing the property.

Homes bought as primaries and then turned into rentals (without considering them as a future rental at time of purchase) rarely work out well.

You are bound to make mistakes like this in the future with a lease like that.

And does this limit what I can apply these funds towards in the future? 

Keep Me Posted For Some Joint-Venture Deals In The Future!

I'm going to do it on my own but like you said I will help the fellow agents and build good relationships for future business.

Also check with your electric company to be listed as the landlord so that you would be notified of a future tenant does not pay.

Acquire the business owner mindset now by doing and giving your future earnings purpose.