Preparing for possible Eminent Domain buyout of my small MHP

10 Replies

Examining highway expansion plans it appears the highway dept will need most or all of my small MHP (15) lots, all with park owned homes.  Park and homes are  free and clear.

Reading online and talking with my CPA I understand when an offer is made the first one will be low ball.  Ok..I get that.   I also think they (highway dept) will only be interested in the land and not the mobiles. 

The park is an income producing asset which I did not plan to sell and would eventually turn over to my children.  For the most part my wife and I are living off of the income.  I'm also at the age that I prefer to not start another park...nor have 15 mobiles for sale.

What is best way to arrive at a fair value..and get it?  

There is a lot of experience on this site and I would appreciate ideas, thoughts, experiences, strategies...etc.

Thanking you in advance.

Great Morning David, 

I’d say the income approach & or comparable properties would be your best bet. Have you had an appraisal done? That may be the best doc to present to the highway Dept. 

Where are you located? I’m always looking for used homes. I work with parks in Virginia helping them fill empty pads. 

Thanks,

Tom

@David Starr Definitely start with an appraisal. If you've had any offers in the past for the park, you may be able to use that as well. Also, any documentation regarding upgrades to the park itself or lot rent increases should help to build a stronger case. Good luck! 

there are appraisal firms that specialize in this type of transaction.

my Daughter interned for one in CA.. and her job was establishing value along the Napa River

in Napa CA.. it was a huge undertaking as they were doing big flood control project.. 

dealing with all sorts of business's and land owners..  

@David Starr My partner and I own several mobile home parks in the Tulsa and surrounding area. I would be more than happy to set up an appointment for you to come by our office to put a value on the property and help in any other way that we can.  If you're intersted, feel free to direct message me. 

Thank you Will.  

I'm just trying to determine what is to be expected as I run the gauntlet of eminent domain.  A small property like mine is problematic for most appraisers, even those with MHP experience.  Comps usually are not ready available.

Had a very good friend, now deceased, who was an appraiser.  He always said "everyone is an appraiser...at the end of the day something is worth what someone is willing to give for it".  I've found that to be pretty truthful.

Of course buyers, sellers and bankers have to have numbers to crunch and the numbers usually won't lie.  

However,  the right situation and circumstances can turn good numbers bad or bad numbers good.

Thank you Rachel, 

My tax guy (CPA) has a pretty good paper trail of improvements I've made over the years so that will help.  Park is small enough to be under the radar of most buyers and Ive never had it "for sale", yet it is big enough to provide a good return (for me) on my investment of time and money.