Files migration failed
First off, when there are failures, check the messages table to see what the specific failures are:

$ drush8 mmsg upgrade_d7_file


In this case, I'm sure what you'll find is that it couldn't copy the files, because it couldn't find them - your .yml file does not include source_base_path, so there's no way for the migration to know where to copy the files from.

I'm guessing when you ran drush migrate-upgrade --configure-only to generate your migrations, you forgot --legacy-root - this value (either the address of your site such as http://www.example.com if you want to scrape the files directly over the web, or an absolute local filepath if you've copied the files onto your D8 server) will be used to set source_base_path in your destination configuration.