- Insurance policies (some may not cover rent by room)- Friction among tenants regarding common spaces

I am in the long-term property management space, so I may be a little biased, but everyone saying "STR is more profitable" should really be saying "CAN be" more profitable. 

Quadplexes will fall under residential financing, while larger units will move into the commercial space.

But if you look into their marketing, socials, Youtube, IG, past sales record on Zillow and stuff you can see if they really are in the investment space or if they work with traditional homeowners.

To find good LPs, you need about one to two years of brand building to have any credibility in the syndication space if you didn't come to it from another part of the industry.

It also has become a popular travel destination over the last 5 years or so, so there has been an increase in competition in the STR space as well. 

Most flippers will only add the ADU if there is already under utilized living space (not garage conversions but craft rooms, bunk house, etc) to convert.  

I'm in the messy middle as a residential agent who works mostly with investors and specializes in the small MF space.  

Given the high demand for industrial space, especially near major interstates, this could be a smart move.

Quote from @Marc Shin: Look underneath it (crawl space, basement).