I was considering a 50/50 partnership minus any money invested into the intial purchase or for renovations. 

I do have 760+ credit score but just don't have money to make down payment at this time. 

I bet Walmart isn't even at less than 1% net, why isn't everyone flipping out that Walmart is "colluding" for higher prices on product's in it's stores.

The reason for selling is because the home has been a money pit (major tenant damage) and a revolving door (tenants leaving).

I only know about the times where this was found out prior to closing, obviously I have no way to know about the times this shady behavior wasn't found out.Since you get a vote in who this tenant is, and it's retail, PSA that commercial lenders (especially the ones offering the best terms...) are starting to vet deals by how 'recession proof' the tenants are, even if they are currently paying on time.

Like politics, real estate is local (even hyper local sometimes) and none of us have a crystal ball.

- Is it possible to avoid paying taxes if we just re-invest all the money to pay down the principal on the new mortgage (residential)?

I suggest building relationships for private money, this is how we fund out mobile home with land deals which we buy.  

I was able to save a good amount of money and purchase a 3 bedroom 2 bath mobile home on an acre of land all cash, that property generates $875 a month, no mortgage or HOA fees.

I want to pay them a preferred rate of return on their money without giving up equity in the deal.