As mentioned by @Anthony Dooley, having the property owned by your custodial IRA does require the custodian to write checks every time you want to pay someone, and that can get irritatingly expensive and cause delays and errors, depending on the way your custodia charges.

If they are investing their money in your property, they have more skin in the game.

A bank would be skinned alive holding a no income verification loan in any portfolio by regulators!

The "bad loans" don't scare me much those as most loans have buyers with skin in the game in regard to down payments, proving they can repay, etc.There is some talk going around about helocs adjusting, and loan modifications adjusting, that may add some desperate sellers to the market but we will see.

That feeling of having "skin in the game", brings another level of awareness to the playing field.

The thought of someone building right behind me makes my skin crawl.

I think the terms @J Scott laid out would be very fair - if you have no experience and no skin in the game, I wouldn't be agreeable to lending any money on it.

Regarding the cash reserves- It's not about using all your reserves but you must some skin in the game.

I'm really not looking for a yes/no, to my "untrained" eye all the numbers seem ok (expenses don't seem under-estimated, the increase of ~250$/mo/door rent over 3 years seems reasonable considering the area, sponsor has some skin in the game and they have been in business in that area for a couple decades, ...), so I was looking to some more seasoned investor willing to share with me any clues as to how this deal might be bad (the only one I can think of is that returns might be very tight if a downturn occurs over the holding period, however since this one is not a class-A SFR property it should be more resilient).I would be looking to invest about ~50k$ in this, which is a small enough portion of my net worth (< 10%).Thank you.

Private lending may work but you still need skin in the game and the interest rates are more than conventional mortgages.