How to proceed with mobile home park in texas

[Mike Reynolds]

I made an offer on a MHP for 423k with OF a little over a year ago. I was turned down (it was a good deal for her). It went on the market and had 2 offers. The 1st offer wanted her to get rid of the TOH's and wanted her to clear them out. Well, she did and now she has gone from a 10k a month to 3k a month. The second offer wanted a new driveway but by this time she couldn't afford it. 

Now we come to this year. 3k a month with 7 vacant MH's and 2 vacant SFH's. Both have been upgraded. One with wiring and the other with house leveling and siding. It is off the market. I talked to the (ex) broker and he gave me his blessing. The park comes with 2 water wells and septic which is common in this area. I talked to the plumber that installed both and he says they need to be upgraded but will work fine for the MH's there now. The property is 45 acres and only uses 10 of these acres. I can rent out the POH's for about 650 or sell them and charge lot rent. The lot rent is 190 but needs to be at least 230-250 (min.). Especially with water/sewer included. During the option periods she spent 70k ( got this figure from the contractors I know that did the work) doing upgrades) on the 2 SFH's and the MH's. Now the MH's are toast again but the SFH's have never been rented out.

I bring to the table- cash for a down (1031 or solok), building experience, and a dirt crew from Ark. that can fix the driveway in short order.  

How should I approach this deal? I l know she did all this work but in the process she decimated her numbers by evicting. I feel she will want more money than 423k but I feel like it is worth less now. Am I wrong? I am not sure how long it wil take to get renters back in. The driveway is so bad the mail or school bus wont run down it anymore. The driveway is close to a mile long. Her husband passed away 2 years ago and she never knew how to run it. Some lot renters have been there for 20 years or more but will leave of she doesn't get something done soon. 

I feel I can help her and the long term renters, I just don't know how. 

[Salvatore Lentini]

Hi Mike - I don't have anyone to recommend.  The basics of it are not difficult to grasp.  You'll want to look up Master Lease with Option.  That means you will agree to become the Master Tenant and then you sublease to all the current tenants.  Say for instance current monthly rents are $3000.  You agree to pay $2800/month.  Tenants pay you $3000.  You cashflow $200/month.  But, as you increase rents through better management, renovations, capital improvements...you get all of the upside.  So if rents go up to $7000, you now cashflow $4200/month.  Then you also have an option to buy in the contract for a set amount and date.  You decide when to pull the trigger on that.  Seller wins because you take over the management of the property right away, you win because you get the property for a likely discount.  You only buy if you decide the property is worth it in the future.  Anyway, that's a summary but you can find better info out there.  Once you work out some details with the seller just get your attorney to write it up.  A precursor call with your attorney would probably be wise so you know what to negotiate for with the seller.