Currently the property is completely gutted to the studs, but drywall and electrical is up to date. 

* Do you have a written statement from your property manager that their fees are 8%* Are you paying electricity and gas for tenants?

...if the plumbing/electric are as old as the wood panels & popcorn, then it's possible they're nearing the end of their service life...If there are plumbing / wiring issues behind the walls (or if the plumbing /wiring are just nearing the end of their service life), then does it make sense to rip out the paneling & do drywall without addressing those issues in the process?  

Just imagine getting a 6 unit and for some reason things were missed during the inspection and 1) Electrical wiring has to be changed  2) Oh look that plaster is coming off and its all plaster  3) Turns out 2 of the tenants are leaving because they are buying homes 4) Looks like we need to replace 1/2 of the windows and appliances. 

Definitely focus a lot of your energy on relationship building too.

They typically don't add any value when it comes time to sell, but definitely save you  on electricity.

All new electrical wiring (down to the studs in the kitchen and bathrooms) put it over budget $100,000.

My concerns are: -Some of the electrical isn't wired properly (double tapped)-furnaces 50+y old -various locations of water supply line show signs of leaks at some point-galvanized steel pipelines.

All electric.

There is no way to completely separate it from the main part of the house, as it also has the laundry machines, furnace, electric panel, and storage areas I need to access.