Real estate for the last four years was betting on red or black but the ball was fixed to win as it was nearly impossible to lose.

(I know a lot of investors who are doing this, but I've been surprised to find out that it's a new concept that others haven't considered.)The more units, the better in this scenario because you can hedge your bets with more units.

The Midwest is probably your best bet for a number of reasons.

There's likely some good lessons he's learned that you may heed I'm not betting against you, but it seems like it could be a massive problem snowballing in the future.

If you kept the property, and accumulated the CF/yr, it would take you 25 years to get that same equity that's sitting, frozen in your property.Also, if you cashed out and used that same equity as a DP on different RE, at 20% DP, that equity would buy you $2M in PV, not just $700k,...and, I'd be willing to bet, you could find new RE that would have a yearly CF well over $20k/year.On top of that (remembering my initial statement above), any appreciation applied would be applied to $2M, not just $700k. 

To confirm my recommendation ask him for references at his current developments, I bet he won’t give you names and will make up an excuse!

In my opinion, that is a riskier bet because you have to have a big pile of cash for contingencies.  

I haven't seen any statistics to this effect and I don't think any has necessarily been compiled but I bet I wouldn't exaggerate if I state that 95% of the value of real estate in Southern Spain or at least the province of Andalucia is in the Costa del Sol.

The debt may not report to your personal credit (unless you are late on or miss payments, then all bets are off)2.

The owner needs to know you are solid, a good bet.