Seller is stuffing tenants to juice the numbers. 

Even though not student oriented, the crush of students looking for rentals, do add some competitive juice to people looking at my SFRs. 

You've got more than enough to get your juices flowing here.

Plus, this does not sound tremendously dated or obsolete building situation (built mid-century and updated since)....I do, though, like when landlords are responsible and don't squeeze all the juice out of the lemon and exit stage left (and pass on all the deferred capital costs to a less informed buyer, like a hot potato).

I'm not sure there's enough juice to squeeze for that.Maybe a "master lease option" with a mix of repair options: ie: if it's an expense above $1000 they have to pay for it otherwise I would?

@Paul Choi  I am not sure the juice is worth the squeeze on this one. 

I would have them post a performance and payment bond for the build (so you have recourse if it goes belly-up) and have them name as you additional insured on their insurance policy.Don’t forget to check the utility infrastructure to the site.

Bank likes it because at that amount of owner financing they feel the seller won’t walk away if I go belly up.  

Much quicker than a multi-tool if all you care about is wether or not their is juice in the lines.

If your father owns a mortgage company, then he has seen many, many investors go belly up after the mortgage crash.