The guy I am looking to work with is a national icon in the entrepreneurial world and knows what risk is.

Without operating statements you are left making an educated series of guesses to arrive at a number representing your risk in the purchase.With every single step you take in this always remember you are buying a failed business.

They wouldn't carry the risk, even though I have a rehab loan that would pay for all of the repairs.

Your risk exposure as a flipper is similar to that of a builder and as such you need to operate through an entity to limit your exposure.

Can I view depreciation write offs as a no intrest, no risk loan against my future appreciation realized at the sale of the property because of depreciation recapture?

Tenants, once approved for subsidy, don't like to risk losing it.

., price + rehab = 70% of ARV), they certainly won't make anywhere near $80K profit.Assume they get a hard money loan for the $140K and hold for six months.They pay purchase closing costs around $2500.They pay the $20K for rehab.They pay about 10% of the loan in money costs, $14KThey pay insurance, utilities, and whatever else in holding costs, $3K (try pricing a vacant house or builders risk policy.)

If a bankruptcy is due to a once in a lifetime bad event, and he is good about paying his bills since, he is probably OK as a risk.

If its retail, and you are determined to have something in that area, just go buy something now, and eliminate the risk of this developer failing.

This is called "risk overlay(s)" and is explained here.