Hi @Vicky Luu, from your initial rough estimates this sounds like something that could work well for you.  

I'm used to raising over a million dollars a year, so I have no problem asking anyone for money, and I have no problem being told no, and working my way from that initial "no" to a "yes".

If you make 50% return on investment and you make your initial investment back in 2 years is it good to you?

A lot of the time it really will not matter initially.

If it's an Absolute NNN lease that means the tenant is going to pay all expenses directly, roof & structure included, not reimburse the landlord.In your case since it's a sale leaseback, I would try negotiating with the tenant to have the lease be an Absolute Net Lease since they initially owned the building and understand its working history.

We then subtract $40k for reno (because it will more than likely run on the high end of your estimate), bringing us to $57.5k, which is below the initial offer they received from a realtor and since you don't want to work your butt off for $5k, you ultimately need to offer them less than every other offer they've already turned down.Long story short, really focus in on your estimates throughout the equation and prepare to move on when you can't make a competitive offer. 

As for rents - the 1% rule of course is ideal but most investment properties are evaluated initially on cap rate.

Having put 20% down for the initial purchase, it was easy to make it cash flow.

Have the licensed plumber that was initially called for this issue provide you with a report of the items found as the cause of the blockage and the recommendations, preferably you should also have photos of the items causing the blockage.

Unless you have significant other assets...in which, case why do you need to recapture that initial equity?