Unless the property management company has a collection attorney on staff, they are not really equipped to handle the matter.

I will be handling a lot of the hassle with the property but our partner will be providing the majority of the funding.

One of their biggest issues was that they were not on town water and sewer and were going to have to dig a well to service the showering and restroom facilities as well as build s septic system to handle the proposed traffic.

Back when we could purchase properties for a deal, building in enough discount to handle every contingency was doable.

For your first question, I do intend on keeping money aside to handle those issues, thats a great point. 

"But with fair market rents of $950 and $900 for these units it would cashflow $518/month with a 16.58%CoCROI" Your use of the term "fair market rents" assumes that the market can handle those numbers.... if so, it sounds like a sound investment.... 

I would like to get some feed back on how some of you have handle the real state investing outside of state and how to handle property tax.  

Dave Foster- who commented above, is 100% who you want to hire to handle it as well. 

Is there a down side to keeping the properties in an LLC and then setting up an S-Corp to handle the management?

I plan to manage myself to start out.As for Improvements I'm estimating 20k but how do you handle that when it is fully rented?