Apartment building Analysis

[Parker Chrisman]

I'm definitely in need of some help/advice. Rookie investor with one rental property that was a "live in then rent" so haven't actually purchased a property solely as an investment yet. In all of my education over the last couple years, I've focused on SF and SMF housing. I already have a market(about 3.5 hours away from where I live) where I want to invest and an agent. I just came across a 12 unit apartment building for sale with asking price of 200k. That already jumped off the page to me and have been doing nonstop research trying to find out as much as I can. The property is in poor condition as 4 or 5 of the units aren't even livable at the moment and the owner is trying to evict another tenant for nonpayment. Current monthly rents total a little over $2,000. Seller is just trying to dump the property as they aren't interested in owning rentals(it's a widow whose husband bought the building years ago) so I know I could probably talk to the selling price down a bit. Complex isn't in a great area but went on HUD website and got their valuations of fair market rents as would probably rent to Section 8. Total monthly rents would be almost $8,000 based on the HUD numbers with all 12 units rented. EVEN with putting 200k of renovations into the property it would still cashflow well. Based on my calculations, with the HUD rents and a 9 cap rate, the value would be $800,000. My questions are;

1. Do I pass on it simply because I have been studying up on SF/SMF and haven't "planned" on buying an apartment this size at least for a couple years(planning on doing "The Stack") or do I go for it since it has the potential to be a killer deal?

2. Should I go HML and BRRRR it or would I be better off getting a construction loan with renovation costs in the loan?

3. I don't have any experience dealing with contractors so for something this large and also being 3.5 hours away should I look into hiring a project manager? I could potentially approach my agent about doing it for some extra cash.

4. At what point during the process do I have contractors go to the property and give me estimates? Before I put an offer in? When it's under contract?

5. What all am I missing in the valuation process and analyzing the deal? Seems almost too easy for me and an absolute no-brainer yet it has been on the market for over 2 months...