The ones that do survive 80% plus are owner operators meaning they are the business and have just a few employees.

My guess is the houses are in class C areas because they had to be, for ARV and cash flow purposes, but are unlikely to operate at a high enough Cap to justify a buyer not just moving on an APT building instead.

I operate a property management company in Indianapolis called Intrigue Indy.

Caution:Contracting for repair, maintenance, remodeling, or improvement by any person licensed under part I of chapter 475 (real estate agent) while acting as the owner’s agent pursuant to that license, where all work requiring a contractor is performed by a contractor who has a current, valid certificate or registration issued under this part to perform such work, and where the aggregate contract for labor, materials, and all other items is less than $5,000; however, this exemption does not apply: (a) If the maintenance, repair, remodeling, or improvement is a part of a larger or major operation, whether undertaken by the same or a different contractor, or in which a division of the operation is made in contracts of amounts less than $5,000 for the purpose of evading this part or otherwise.For the sake of your cousin's license, either make her a part owner (sharing the gross profit as her compensation) or get a GC on the job asap.Just a helpful hint to keep a fellow real estate agent out of jail. 

Do the operational partners have the liquid capital, net worth and background to close?

If you can swing it, I feel Blackstone BREIT is a better initial/core holding because it is a much more conservative core plus strategy (or maybe stREITwise if no).

Almost 3 years ago, we found her and she became the most integral part of our operations.

This will likely increase your operating costs to some degree over a non-project HUD building.

I have been invited by a fellow that is a member of Biggerpockets to be involved in buying and selling single family homes and I might go into that because of my brother who has plenty of experience and is knowledgeable in that field and he has offered to help me.The reason I chose apartments is that I have been convinced of it ultimately because of all I have learned that it is the best way to go long term and ultimately you can hire a Property Management Company that will take care of the daily operations and that managing a property management company will not very time consuming. 

And do the smaller listing agents also operate this way?