I started looking at individual properties and then began looking at small class B portfolios with 5+ units.

You can use up to $25k a year of those passive activity losses if you are actively participating in your real estate ventures ("small landlord" exception) and income stays under $100k a year.So yes it can be useful if someone happens to fall under these circumstances, but for anyone who is going to have over $100k a year of retirement / other sourced income, they may be out of luck.It's all timing - you are just using up those PAL earlier than if you waited for the rentals to start producing taxable income (they normally do if it is a good investment), or a property is sold and PAL are released to offset that income. 

Collections, payables, marketing, maintenance, they are work great but with some small issues here and there.

Your wholesaler will 100% point you in the right direction to get started if you are feeling overwhelmed. 

The only thing is that will not allow you to do it as a cash-out refinance, because they only allow you to directly invest the money given in a new property with financing from that bank.

Also, in a mainstream asset class like value-added multifamily, I see no reason to take a risk on a sponsor that doesn't have full real estate cycle experience or that lost anything more than a small amount of money (and prefer no money lost).

I'm doing some work for a client who is looking to do the same, though not specifically near the Clinic, as you can reach people at any of the three health systems without being directly near the Clinic.

I would self manage...in a way..I have a crew I use pretty regular for all the rehabs I do so I have people in place to help if I go the STR direction.

MTR seems like an underserved niche, but maybe it's too small?

again, i'm not trying to be discouraging - just trying to arm you with some facts as you get started.feel free to PM me if I can be of additional help