Looking to buy restaurant/bar with 8 rental properties

[Jesse Levi Kelley]

As this is my first purchase in the commercial realm I am hoping to gain some skilled knowledge of what I am getting into. I am dealing with a seasoned seller who seems to be demanding a bit much for the property I would like to purchase. I say this based upon: The geographical location, the appraised value, and the laundry list of inspections I have paid to have done that have noted some upgrades that need to be done to meet code. 

According to the P&Ls they are counting the maintenance done over the last 10 years as equity and would like to have that back on top of the claimed equity they feel the property is worth. Here is where it gets a bit sketchy for me (the new guy to this industry). The owner wants twice the appraised value for the property (approx 180k), but is willing to "float" the cash in the form of a personal loan against his other businesses and give us a year to start paying him. Honestly, doing the math based upon my didactic background in business finance, there is no way I can take over the notes he has on the place (his suggestion to avoid banks and inspectors), cover operational costs (variable and fixed), maintain the known issues and repair the (recently) discovered issues without being either behind every month on the loan or going belly up. The realtor says "This is a good deal", however the math is not adding up. After breaking it down to the realtor they are starting to see my perspective. Yes it is a turn key business, yes it has been operational since 1947, yes it has cash flow, but none of this stands a chance against the work that needs done to brings things up to code, repair the issues that the owner is denying (even after 4 building and code inspections) and keep everyone on payroll. 

Honestly I could see paying close to the asking price if I didn't need approx 250k to get the place up to par, but as it is now I cannot. 

Why the heck am I still interested? The place has been in our community for a long time and has a well established name. It has a great deal of size and parking for my next phase (a micro brew). The building itself is solid and just needs a lot of maintenance. Geographically it is a perfect location for my venture and the apartments keep the income steady. 

I need help seeing past a seasoned seller (the bull crap) and how to see the truth. In the mean time I will keep watching and reading the information provided in this amazing website and what I have in my text books. Let's be honest they don't teach this type of skill in the class room. 

Thank you all in advance

Jesse