Nonetheless, homes are trading and apartment rents easily keep up with the city average.

I prefer a GC over independent trade contractors but that will also help.

You found the deal and are going to manage all the work, she puts up the money.If you do any of the actual trade work yourself you should be paid the same and anyone you would hire, however in this structure I would recommend sub contracting everything out and knocking this out quick. 

If you want to know the appreciation potential, records show I could have gotten $650,000 for it in 2018, therefore it appears the market has flattened out.Would you TRADE a 2-3% Cap Rate for a 5-6% Cap rate when you are looking mainly for Retirement Cash Flow?

From my prospective, economy of scale plays a huge role in my decision making and hence I chose commercial real estate (for example, multifamily versus single family).

From that point you make the decision based off their value (essentially the benefits they offer - the cost.)This is not legal advice, just my opinion as a real estate investor.

Oftentimes, sellers will sell cash flowing property because they are looking to trade up.

However, the actual filing and decision whether or not you should file, should remain in your discretion.Too many claims, especially frivolous small claims, can have an adverse impact on your premiums and insurability. 

So, I'm really stuck at crossroads between this decision.

This is a personal decision that varies by investor, but I chose commercial for the following reasons:1) I wanted to stop leasing office space for my accounting practice.2) The thought of "$100/door" as a metric/goal for residential was depressing.3) No calls from tenants at all hours of the day/night.4) Easy to evict.5) Commercial is much easier to force appreciation than SFR.