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I'd just replace it with a reguler tank heater.
Reasons being your not going to be able to just "swap" the two heaters out.
All new gas or power lines will need to be run.
What little bit of cost saving to run will be eatten up by the cost to install.
A tankless will require more maintaince, last ting I'd want on a rental is to be getting calls for no hot water.

There will be no pay back time, once it's payed it's self off it will be time to change it.
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