Investment with 12% Cap rate but not the greatest apartments/tenants

[Danny Colacicco]

So in seeking wholesale deals, I came across an investor looks to sell two apartments with 5 total units in a decent area of Baltimore (Greektown). All of the apartments are currently being rented, however, when viewing them, the apartments were dated/not in the BEST shape and the tenants (not all) had very poor hygene. Nonetheless all teneants have been living there 1.5-4 years and do not want to leave. I have negotiated the property to a cap rate of 12% (after taking out all fixed/variable costs and my fee) but I am still weary of putting it under contract as I am nervous that I wont be able to find an end buyer given the condtion of the property/tenants?

Can anyone give any advice as to how they would proceed with these? Would you put them under contract?

Thanks in advance for the advice!