The one-year time period will allow us to minimize the holding costs and, if I understand correctly, avoid the capital gains tax.Thanks in advance!

You're improved expenses won't matter.What's your payback period on the $12k? 

It also depends on your hold period; next year might not be great but over ten years the average is likely to be much greater than 3%/inflation most places in Denver IMO.   

If you provide an example, I'd be happy to analyze it for you. i bought 4 different townhomes in an East point complex within a 6 months period and paid 119k...140k..150k...150k...my rents are 1600 and I've had no problem getting tenants. i paid full listing price for these.

If you play your cards right, you can find a lender who will allow you to use the "delayed financing" exception to do a refinance without having to wait the usual 6 month seasoning period.  

After the discount period is done, you are paying $840/year!

Real quick turn around and i have a local bank who will do the refi without the seasoning period.

Your contract should have an inspection period in it that will specifically outline what inspections you are doing and how long you have to complete them.

One huge risk of being over-leveraged is when you have a mortgage with a term shorter than the amortization period (most all commercial mortgages). 

In my experience, the funds I was raising were committed up front, and can be called over the investment window of 3 years, and AMF are charged based on commitments during that investment period, and called capital after.