There is an REO property in the town next to me that I would like to investigate further and ultimately make an offer on.

The deal is not too good to be true due to 3 large risk areas that need additional investigation/information1) Actual rent controlled rent versus market value since it's a rent controlled unit.

He’d like me to proceed in investigating this option...Thank you for all who are able to help...Park: $650k18 pads , 13 owned homes, room for expansion.

Have you investigated those areas at all?

Have you start investigating with the city? 

So after further investigation the property has been on the market for 2 years.

It may be worth the time to investigate this as a possibility for you.The DST is not obligated to pay the $800 franchise tax mentioned above, and can contain as many assets as you like.

This civil penalty may be recovered in any action brought under this part by the enforcing authority; or the enforcing authority may terminate any investigation or action upon agreement by the person, firm, corporation, association, or entity, or the agent or employee of the foregoing, to pay a stipulated civil penalty.

If that's the case, essentially, there are two types of professionals that can help you when investigating and analyzing the comparable sales in an area -- real estate agents and appraisers. 

I don't know anything about the Fort Smith market, but if you think this place has potential its worth your time to investigate further.