Commerical Land?

I drive by this small strip of frontage land that is mixed use every day going to and coming from work. There are about 10 lots - some with single business buildings, and a few with residential housing units. The single business buildings are all rented out, and usually the business only lasts a year or two, before you see a "For Rent" on the property again. about 4-5 moonths ago, I noticed the two residential properties had an agent's "For Sale" sign in the yard. The buildings were in bad, but livable shape, and I never really thought much more about them. About a month ago, I'd say, I noticed an auction sign in the front of the properties. Again, I thought nothing about it. Within the last couple of weeks, I've noticed a hand-made "For Sale" sign in the front yard. At first, the sign said "$205,000", and then "$198,000", and kept dropping. Driving home yesterday, I noticed the price had dropped to $169,000", which finally caught my attention.

I did some research and found out that the property consists of 4 total lots - three of which front the main road, and one is to the rear of one of the others. This has really piqued my interest now as the zoning for the property is Real/Commercial. Like I said earlier, the buildings themselves are in bad shape, and I would definately tear them down if I were to ever buy the package deal. This led me to research the value on the land itself. It turns out that all four lots, collectively, were assessed at $204,000 (with the lot in the rear being the least valuable, of course). My initial thought was to buy the land, tear down the 2-3 buildings, put in a small office complex (1- or 2-story) with 5-15 "units" total, and rent the space out.

At this point, I would still need to find out who the owner was and if I could first negotiate th terms and/or price to help accomodate my future plans. I would also need to find out if the zoning would allow for what I would want to do. On top of all that, I would also need to find out how much demolition would cost as well as the costs involved to make the necessary improvements (i.e., water/sewer lines, other utilities, actual building costs, etc.).

The lots are in a prime location not too far from a brand new major shopping complex, which would make them ideal for this situation. I'd just need to do a lot more research before jumping in, though. What I'd like to be able to do is try to buy the land with great initial terms that graduate with time, or cut the owner in on some of the future profits.

Lot's to think about.