The owner may pay utilities also, the gross rents can be deceiving..

Anyway got a lawyer involved and the decision was she has to be out by September 30th 2018.. today she calls me up asking for a extension because she cannot find a place.

Its not cheap to have a property demoed in Detroit, Ex.  2100 sf , two story, between two existing homes will cost approx. 13k, without asbestos and lead remediation - it will take 60-90 days to get utilities terminated, and proper permits issued.

One has much more capital to put in for a down payment than myself and the other friend, and he is not opposed to utilizing his greater capital to get us into a larger property. 

Landlord pays for oil, water/sewer and trash.If we end up acquiring the building, we would somehow want to pass the heating cost to the tenants for new leases.One way would be to implement RUBS (utility bill back to the tenants based on sq footage of the units, # of occupants, etc).Another way would be to convert to electric heat.

Has anyone tried to utilize a rental property mangement company for this purpose?

@Josiah Kay tenants pay all utilities.

Some states allow text messages or emails as notice.What the landlord can do though, is as soon as your friend signs the lease for a month extension, the landlord can then send him the notice right after.

Yes, I agree with the SF comment, for me they are asking way far from what what is really worth perhaps betting on the potential of the lot (huge patio around the house) that easily accomodate an extra room extension for example.

To best identify true value, I would look on the MLS or utilize an agent to pull comps for current condition and ARV comps.