The value add could be a mismanaged property, a property plagued by vacancy (marketing deficiency) a property that can be broken down into smaller units hence growing NOI, etc.A move in this direction would serve multiple purposes:a) Buy a deal you could generate greater NOI than a similar 'straight' leased investment.b) Allow you to gain some experience managing and marketing CRE space.c) Provide you with a track record in commercial which conventional CRE lenders look towards when loaning on CRE.

That business didn't survive my multiple trips to Iraq, so I'm cleaning the building out so that I can rent it also

Investors find it uneasy knowing the operating partner (gp) will have little skin in the game and are less likely to invest.

The best thing you can do is build a strong team around you and/or partner up with an experienced investor to help you get some skin in the game for at least your first few projects. 

Though the Hotel and Multiple Dwelling Law provides that multiple dwelling buildings having a condominium or cooperative or mutual housing corporation form of ownership are under the Bureau's jurisdiction, the law also exempts sections of such buildings that: 1) contain not more than four dwelling units, 2) have at least two exterior walls unattached to any adjoining building section and where attached, are attached exclusively by fire-resistant rated walls, and 3) contain dwelling units that are owner-occupied (if both owner- and non-owner-occupied units are contained therein, only the owner-occupied units are exempt)."

The private lending could finance only the down payment and the rest could come from a conventional loan, thought you may need to use a portfolio lender as some banks want you to have some skin in the game.

Data provided to OAR by Multiple Listing Services includes residential closings for new and existing single-family homes and condominiums/co-ops.

It's been a frustrating process with the agent who didn't honor our deadline for a response (which was the first by many days) but waited for more offers and then did a multiple counter offer, meaning they countered several offers.  

Multiple heirs can be a deal breaker.  

Running each property seperate from another in LLC's would be a bit much, most people run one LLC with all the property under the same umbrella, sometimes if they are spread across multiple states and cities people will separate them out.