Praxis Capital

The MF fund I am in is having trouble. The causes are complex, due mostly to the significant headwinds that all MF from the last decade now faces. I'm not getting distributions near where I'd like. The good news is that it is largely due to no fault of their own. In hindsight, variable rate financing and rate caps ended up costing a lot of money and I'm not sure if I prefer a syndicator who chooses that route--though obviously in a different macro-economic environment, I think they would have sold all the assets in the fund in like 2023-2024 and I would be having pina coladas on a beach right now. The fact is that much of my MF portfolio is ailing, and many LPs know what this is like because they are experiencing the same exact situation. C'est la vie. Though I have had some moments where I questioned much about multifamily investing in the last five or six years, I have never questioned their ability, their integrity, or their honesty. In fact, I think they are working hard to manage the assets and the properties well enough that eventually when a sale is possible for a non-negative amount, they will jump on it. As he says in his book (paraphrasing here) unfortunate things happen in MF investing, but it is the integrity, the hard work, and the ethics of the sponsor that matter as much or more than any other factor when it comes to earning profit for investors in a timely fashion. Or when it comes to not losing LP capital. Will I make the IRR I was hoping for? No. Am I happy with virtually ANY of the MF I bought in the 2020 era? No. Would I invest with them again? I just did, in their Healthcare Fund. I probably came away from this era feeling that fixed rate, agency debt is advantageous--but the CEO Brian Burke makes a cogent and compelling argument that in most normal cycles (this is not one of them), variable rate financing + rate caps allows a certain nimbleness that fixed debt does not. I think one can get a really good idea about what Praxis is all about by looking into videos, podcasts, and forums online, and if one does I bet they will come to believe that Praxis is a unique and trustworthy company based on the evidence that is out there.

I invested in Multifamily Fund V. Most of these assets were acquired near the peak of the market in 2022. Subsequently, distributions were paused for some time. During that time, Brian and the leadership team have been very detailed and transparent about what's going on with the portfolio. The professionalism and real talk is second to none. They were able to avoid a capital call and just turned distributions back on. If my expectations were't met, it's only because the investment didn't produce a home run. However, if you go into an every syndication with that expectation, you will most certainly learn disappointment. What Praxis showed me was the gold standard in how to deal with tough situations and anxious investors during a difficult time in the market cycle....A+.

I invested in a fund with Praxis and Brian Burke, and I couldn't be happier with my decision. They are smart, experienced, and they manage risk very well. The fund closed in 2021 during the peak of multi family, but I'm still receiving distributions and there have been no capital calls, which is a stark contrast to many other syndications closing funds around that time that have paused distributions and made capital calls. Their communication is excellent, and I can't speak highly enough for their team. I'd be happy to invest with them again.

Let me preface this review that this is our first syndication investment, and we just completed the first tranche. So I'll keep my comments to this aspect and update later on performance. Praxis has been doing mainly MFH syndications for well over a decade, and Brian, the CEO, even longer in the game. Their IR peeps, Bob & Haley, are great communicators and all are an "open book" to all annoying questions during my many inquiries. We live in Northern California, where Praxis is based, and they were open to a physical visit (near Sonoma wine country, so we made a day of it). I spoke with a long-time wealth manager who has put his clients and his own money invested with them in many MFH syndications. He described them and their communications as "Top Tier" among syndicators he has invested with over his many years (he was in his 70s. On the website "BiggerPockets.com" and another Investor's club website, I follow Praxis received many very good comments. BTW, they brought in a new partner who had decades of REIT experience in senior living to do this offering since it wasn't in their wheelhouse house and like most RE investors know, the past few years have not been good for MFH investments, but should be soon as the market is bottoming. Assisted living tanked during the COVID pandemic, which has created an opportunity in an industry that has an exploding need from all the "baby boomers' navigating their elder years. So there you have it: Reputable, Ethical, God communications, with Experience, and now hopefully opportunistic with their healthcare fund VII.