How do you valuate a bank owned asset?

[Tyson Cross]

So I came across a 259 unit complex that is for sale and is bank owned. The listing price on the flyer is 2.1 million with another 1.5 in estimated cap ex improvements. The complex is 15% occupied due to the deferred maintenance and poor management. I got access to the financials and they are pretty dismal. The asset is clearly not making any money, so there is really no way to do an income-based evaluation. So, as I think more about this, the only way to really value the property is a market-based approach? How do you factor in the amount of money for repairs? In this case, you could do a full property inspection and realize that the place needs much more than 1.5 million in repairs. If that were the case, I'm assuming you could lower the sale price even more?

The other thing I noticed, being that it is a bank owned property, is that they are requiring cash for the purchase. In this case it needs so much work, that Im sure the only way the bank would feel safe enough to sell this is with a full cash offer. Are there any cases like this where the bank would actually consider financing the sale? Or is it ever possible to get financing from another source to purchase the asset from the bank who currently owns it? It seems like with the right amount of capital, this could be a huge value add project with huge returns.