Determining offer on possible tear down wholesale

[Donald S.]

Hey everyone. 

I've got a good lead on a property in a nice suburb of St. Louis. Recently a lot of home owners are tearing down their 75 year old homes and building huge houses. Taking their value from ~250k to anywhere from 550-700k. 

The seller on this lead told me she thinks the place would be a good candidate for a tear down, or just rehabbed and rented out again. So I'm caught on how to value it. I've spoken to some people and found that $220/sqft is about min to build in this area, which meams i cant buy the house for its cirrent value of ~220k and wholesale for a profit. 

So my question is how would you approach the seller with price? Determine the ARV with rehab, and do a normal wholesale?

Determine the value of the land and tell her it'll be a tear down so I can only offer the value of the land?

Something else? 

Also, how do you value the price of land when there really aren't empty lots in this area? And tax record valuations are nowhere near accurate in StL county. 

Any help would be appreciated. 

Cheers!