The purpose of proof of funds is to identify and eliminate dealing with people doing exactly what your doing.

The section they referred to referenced 4x4 roads and not publicly maintained road. 

The business plan is to basically BRRRR these properties, purchasing at a discount due to the properties are underperforming, we are obtaining a construction loan from a lender, improve NOI and refinance a 1-2 years down the road and then hold long term. 

My advice is to identify a good multifamily broker in your market and have him/her reach out on your behalf.

Alex, this could be a difficult situation because the tenant has essentially been trained and probably identifies as a victim with a right to free housing.I would make the tenant one offer: if they move out within 30 days, you'll hand them their deposit plus a full month of rent.

I am at a cross roads here and I would be very thankful if I had some assistance.

Assume everything is obsolete unless a good appraisal identifies something in good shape.imho

zoning did NOT ALLOW for any off road parking..

Roads/parking.

That risk can be managed by learning and following the rules of the road, but you should be aware of it.