I think the crux of my concern is that i would prefer to buy and hold and repeat, but I get the impression he and his wife are concerned about being able to make a clean/concise split at the end of the "sale" which would require a flip. 

Keep checking out BP and asking questions and you will find the next investment that you will get you excited.There are no limits, keep it up and reach out if you have any questions or concerns.

@Daniel Weber @Chris Isley thank you both for the quick and grest insight.As far as the contractor is concerned, for this scenario, do you suggest finding a contractor who will (or can) subcontract other professionals (example electricians, plumbers etc) or finding someone for each particular job that needs to be completed?

Basically they are just telling you "what you see, is what you get" and after you close they don't want to have anything to do with it.Clean title is not a concern with an REO (if it is one - the listing will state REO/foreclosure on MLS).

My main concern is the eviction process.

We don't charge a security deposit for this apartment because we aren't so concerned about the apartment being damaged but we are concerned that a dog might damage our cat so we'd prefer to avoid that scenario all together.

In terms of the right property and absorption: I am not looking to sell it, my goal is to rent it out and refinance with permanent mortgage once the project is complete.

I would be more so concerned with insurance.

I went down yesterday to ring their bell (it's second floor of a multi-family) and no answer.Should I be concerned?

The issue was the underlying zoning had changed to commercial over the years and the concern was that the property couldn't be rebuilt if destroyed....I only use that as an example to say that asking what the issue is the best way to get your answer.