Ken McElroy Doesn't Do Apartments At This Point!
In a 2018 video, Ken McElroy said he doesn't do apartment investing anymore. Talked about how it is too hard to make them work with the low cap rates, and instead he builds from the ground up. He's obviously a big name in the field so I gulped, because I heard from Ashcroft/Joe Fairless about a deal in WInter Park, FL that seemed so solid I pulled the trigger last month. My first-ever multifamily investment.
Of course, Praxis is good, too. And I like 4 Mile Capital, and someone said something positive about Three Pillars. Neil Bawa certainly seems to know what he is doing. Ryan McKenna is all over deals these days.
I'm just wondering if ya'll feel that Ken is mistaken, or being gimmicky. I mean, Joe F. says he has done this 27 times, and I haven't heard that Praxis is getting out of the game. I'm trying to use multifamily passive investing to build wealth and be my heavy hitter. I get that a lot of syndicators are in this space, and that cap rates are quite low. But a value-add investment not being able to "work", gosh I just doubt that Joe Fairless would be able to be convinced of that.
Then again, sometimes a vehicle with a lot of inertia can't slow down if it wanted to. Perhaps that is why Rod Khleif lost $50,000,000 in SFDs in 2008; the idea of throwing in the towel just didn't occur to him.