The thing that would concern me the most are the smoke detectors in the common areas (hallways and basement). they are supposed to be hardwired and connected. if one goes off all of them should go off. fortunately for you that is something easy to test.

I would be very concerned if you engage him to be your professional!

At that point, he/she does have liability because they're failing to disclose a material fact concerning the property. 

Obviously building new eliminates a lot of the cap ex concerns that you would have with a 100 year old property (roof, foundation, siding, etc).

While the cap vs borrowing rate spread is similar today, I am concerned about the cash flow squeeze if interest rates increase in 5 years when refinancing the commercial loan.

I know regional power lines are something I’ve read can be concerning in regards to radiation/cancer. 

Maybe Jim wanted me to make a slam dunk on my first deal to be considered to be in the game, but I'm comfortable with this being my first deal.But to address Jim's concerns on new investors buying into a renovation-heavy project:To new investors like myself,I believe that doing due diligence is the key.

We are concerned about property taxes so need to find something that won't blow up the property tax bill assuming house prices continue to rise 20-25% per year for next 5 years. 

Construction cost is a major concern as you pointed out.

These lenders close faster, less docs/headaches [usually] and are where many investors prefer to go.To take it up a notch, if Cash-Flow is your primary concern and the name of the game, then there are also options for Interest-Only, through a 'Hybrid' term product.