81 Year Old Developer of House for Shaquille O'Neal

[Bobby Holley]

Last week I went on a ride along with an 81 year old developer who lives on a beautiful 21 acre lot that he developed next to a 17 home subdivision.  Shaquille O'Neal bought a house from him in that subdivision so he could live there when he works in the Atlanta area.  

Although he is a sharp guy and doing relatively well physically he needs to downsize his business and liquidate some of his real estate holdings (he showed most of them to me during our 3 hour tour).  Most of his property resides in the community in which I want to do my initial investing.  He also has plenty of other properties in the surrounding communities.

He is one of the godfathers of development in this county and has relationships with many of the politicians and other seasoned developers.  One of his developer friends (a guy who has a street named after him in town) deeded a house to his son that he bought in 1985 for $23,500.  As a result of some family health issues, however, the current homeowner is considering selling the house.  My developer friend (who is also a real estate broker) drove me to the house and initially told me the seller would "probably" sell the home for $125k.  By the time we were done discussing the situation my developer friend said I could probably offer as low as $75k.

What's confusing is that my friend has not listed the house but he's actively selling it because he told me has the keys to let me see the inside. Here's my dilemma: I want to keep a good relationship with my developer friend so I want to know what kind of offer on this house will make him respect my skills as an investor / negotiator without lowballing and creating disrespect. After all, the house is in the family of one of his longtime developer buddies. The ARV on the house is around $175k.