Several friends who bought units as investments went belly up (these were successful accountants, etc.).

I’m actually buyer, but need to reduce/ eliminate capital gains for seller for the deal to work.  

These are intercompany transactions in the books of both of the entities and will be eliminated while filing taxes.

They want less multi family housing and will eliminate it if they can eliminate it...the thinking behind it??

It starts with the location.The location, not the property, is the most important investment decision because it determines all the long-term income characteristics including:Whether rents will keep pace with inflationHow long your income stream will lastHow reliable your income stream will beThe location selection process involves eliminating cities unlikely to provide the dependable passive income you need through a series of elimination filters.

You also have to eliminate or at least discriminate against places with the highest cost.

--This clause hould eliminate that problem before it can occur.

At the very least, they'll eliminate some possibilities.

If I quickly repair all safety concerns and manage the property well, I will eliminate most issues.2) Have property insurance.   

Our 2 kids grew up in our unit (where only half of the lead has been eliminated) without any issues.