I am looking at a park with about 35 lots with tenant owned homes. They are sub metered for all utilities from the town and the trash collection is done by the township. Everyone must mow their own lawn and keep their home in acceptable condition and the few empty lots are mowed by a tenant for a few extra bucks. Utilities are underground and the asphalt road is in pretty good shape. My partner is about 1 hour from the property and I am 3-4 hours away. I am in the area approximately 15 times a year and don't mind coming back more often if needed. Given that we would be absentee owners, do we need a park manager? Our plan is to use a PO Box to collect rent, so for this discussion, assume rent collection is not needed by the park manager.
If we needed a manager, would free lot rent and $10 per managed lot monthly be considered a fair salary in exchange for park management? Does anyone have experience with managing a park of this size? How difficult is it to find a park manager? We have a vacant lot to offer. And would we need to include lot utilities in the compensation or should the park manager pay for that? The location is rural and lot rent is currently at $140. We believe market rate is around $180 and plan to raise to $160 within the year. Occupancy is 90%. Appreciate your thoughts!
A park like you've described doesn't need much attention, unless you've got a collection issue, or high turnaround. I would start out with no manager, and see how things go. Your partner is very close by, and it sounds like you're in the area once a month or so. If your park is running smooth, then it doesn't even need to be checked on every month. Don't worry, if a problem comes about, then your phone will start to ring! If you ever decided to hire a manager, I'd start with the resident with the nicest house/yard, the one who pays on time every month, and the one who calls you when there is a problem in the park.
A manager for a 35 lot park will eat into your income. Parks usually need to be at the very least 50 units for a manager to make sense. But if you can get a manager and still get decent cashflow let me know because you will be the exception to the rule.
Well... I have parks this size and I have a manger. I send a letter to the residents stating I am seeking a manager, and some of the duties they would perform. If that does not pan out- I post on craigslist. Now- I require my managers live onsite. I comp space rent, and give 10 per month for each occupied home and 15 for each vacant lot. I choose not to visit my parks except about 1 time per quarter. If your there too often- you have a job, not a passive income investment. Even small parks have quite a bit going on with collections, posting notices, violations etc... Using this strategy I can own parks anywhere close to an airport and manage the managers from Colorado. questions?
Thanks for the response. Would you be willing to share that letter? Have you done any consulting for first time MHP buyers? I would be interested in discussing a few items with you for fee. I can contact you via your website.
I had a 44 unit park in Vancouver.. I hired a local PM who cut me a very good deal as the park was extremely well run by the couple I bought it from that started it from scratch and owned it 25 years.. IN our neck of the woods there are special rules for park residences regarding management so it was good to have a licensed broker handling that for us.
Since I am in the development game any maintenance issue our crews handled. But a well run park is one of the best investments out there.. Just on the west coast a well run park is in such high demand the returns are pretty weak all things given.... I got lucky on this one it was off market rents were way low to market.. So with in 36 months I had my rents from 210 a space to 440 a space then sold to large MH investor on the west coast I think they own 50 plus parks... So it was a cash deal very simple and we made a very nice hit.
If you can find someone content with a regular paycheck and able to enforce rules, I find these folks are more effective than those who are not. Best of luck!
Originally posted by @Michael Lyons:
Thanks for the response. Would you be willing to share that letter? Have you done any consulting for first time MHP buyers? I would be interested in discussing a few items with you for fee. I can contact you via your website
Letter to residents-
This is a letter to inform you we are seeking applications for the management position at the __________ Mobile Home Park. Our current manager is vacating the position so we are seeking to hire and train a new manager.
We will be hiring a park manager, to oversee and maintain the community as well as collect rents and enforce the park rules and regulations. We are currently looking for residents who might be interested in this position.
If you are interested in possibly becoming the park manager, please contact us via email – _________________ or fax us your information to _____________. We will give you the details of this position as well as the requirements and proposed compensation.
When you contact us- please let us know why you think you would be a good manager and include any experience you have in maintenance and management. Experience is not necessary.
We plan on keeping the park in good repair and improving on areas we feel are necessary as well as needed.
Thank you for your interest.
end of letter-
I do some consulting for buyers and current operators. Getting through to me via my website is perfect.
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