You might have hit upon a very exciting opportunity. Without hearing about the asking price or what you think of the neighborhood, it is difficult to say how promising this investment could be.
But if I were you, I'd start by checking out the vacancy rates in the neighborhood. The owner currently has 5 vacant apartments and a seasonal commercial rental(call it 5.75 vacancies?) out of 11 units. Any way you cut it, that's over 50% vacancy.
If the vacancy rate in the neighborhood is under 10%(or thereabouts,) then it would appear that the building is being run incorrectly. If you can get it for the right price(meaning some price which reasonably reflects its poor state of operations,) rehab it cost-effectively, and bring it to full occupancy, there may be substantial upside for you. Deals like this one have worked out very well for me.
On the other hand, if the vacancy rate of the neighborhood is around 50%, then the problem isn't the building, it's the neighborhood.
Good luck with it,
Join the Largest Real Estate Investing Community
Basic membership is free, forever.