Instead, perhaps look into alternative financing so that if things don't pan out, you can then tap into that $100k your grandparents are willing to pony up. 

The smaller commercial units usually attract Mom & Pop types of businesses that are often times in business today and gone tomorrow so you are constantly turning tenants.

Walgreens or similar properties on long term ground leases or something similar with AA, AAA+ tenants tend to be attractive.

We also offer other services to attract them that not all commercial owners will do. 

I've found in many cases the margins in real estate are not good enough if management is an expense.As an alternate solution, and I'm not sure how many investors do this (I do, my partner lives out of state), but I would say a solution might be to partner with someone in the market you want to invest in.

We think we’ll live here 1-5 years before buying our forever home.I’m open to alternative scenarios I haven’t thought of.

@Kyle GallowayI don’t think I would get any renters in my market if I did not include a fridge and oven I’m loathed to include a dishwasher but I’ve been advised in my high end market, I need those extras to attract busy tenants with families.

Converting a garage will most certainly be cheaper, though of course you lose a garage and it may not be the best use of the land area.On your original question, though ... these sort of smaller balance, no collateral construction loans are really risky and therefore hard to come by if you want any sort of attractive terms. 

Now I'm looking for alternatives and wanted to know who you guys use or if anyone can point me in the right direction?

You attract under market tenants.