Leasing a whole multi family building

[Menachem Dahan]

Hi,
I was recently scouring LoopNet and came across a property that had an interesting note to it. The seller is offering a lease option on the property. That means that I can lease the whole building from him until we come up with a date I want to buy it. Now, the asset is a 24 unit building in San Diego that has a price tag of 6 million dollars. That means he wants $250k a door. Each unit is 1 bed 1 bath most fully remodeled but some not. Rents range from $1,000 to $2,300. I'm young and unsure if this is how I want to start off my career in real estate. My question(S) is, should I try and work out a lease deal with him and eventually buy it off him? Should I try and cut a seller finance deal with him ( he said that he may do that) and refi in 2 years? Or, should I try, if there is, another route. My fear is that if I lease to buy it then the market in a few years wouldn't be good to buy I would be devastated. This post may sound all over the place but I hope this gives a basic idea on what I'm dealing with and to potentially give ideas on how to go about. If u want to know numbers on the property I could pm them to you. Thanks guys! 

Looking forward to all the great replies.

[Justin R.]

Originally posted by @Menachem Dahan:

...My fear is that if I lease to buy it then the market in a few years wouldn't be good to buy I would be devastated. .

I see this property is being run as an AirBnB business and the lease option is positioned for the AirBnB rental business (including the building), correct?  While the location is in a high-potential area, these old, tiny unit buildings are potentially tough - there's only so many desirable tenants who want to live in a 400sf studio in a 100+ y/o building and pay more than $1k/m in rent for it.

Not many people want to own and operate as asset like this, which is probably why it's (A) on Loopnet and (B) has a lease option offered to entice buyers.  Personally, I don't want to own anything that requires AirBnB income to make sense - I don't think mini-hotels and AirBnB will win the land use game here in the 3-5y timeframe.

That said, this location is AWESOME as a development play.  It's aggressive, but I could see a strategy to buy, operate as AirBnB, with the intention to pursue future development.  That warehouse next door will get torn down soon and replaced with 100+ unit midrise ... and whoever does that will want this land as well.  Have you investigated whether the neighboring property could be purchased or controlled?