Really interested in investing in this market and would accept a relatively low return (or even a break even scenario because i believe in continued appreciation potential here). 

However, the 1031 exchange only applies to the real estate component or real property, of the business, not the business itself or its non-real estate assets.In other words, while you can exchange real estate used in your business for other like-kind real estate, the business itself, including goodwill, equipment, and other non-real estate assets, does not qualify for a 1031 exchange.To maximize your tax deferral, focus on the real estate portion of the sale.

@Jonathan B.Assuming you pass the "material participation" test for 2023 and did not use the property yourself (or used very little), you should be able to treat it as an STR for 2023, including bonus depreciation.  

Whether it's considered an arm's length transaction is debatable, but it's not illegal.Move forward with the sale and ensure full transparency with all involved parties, including your CPA.

I am considering offering him $1.8m with a low (or no) down payment and seller financing at a low interest rate so I can at least break even on cash flow after getting rent closer to market value and with upside potential as a MTR and strong  appreciation opportunity.

The risk is not including due diligence caveats in your offer, like inspections.   

We don't allow any "deal-making" in the forums, which includes advertising your services or properties, looking for partners, etc.

How much do they charge and what's included?

Are you both friends and have unique skill sets and are breaking up the duties of investing based on those skills?

Buying a second home to rent out is a solid strategy, but be sure you understand the cash flow, including mortgage, taxes, and potential vacancies.