How to find managment for Mobile home park

Question

I found a park that cash flows great and the owner is willing to do owner financing. My problem is I can’t find anybody to manage the park. Anybody have any recommendations or ideas? I’m in central Florida if that matters

Jack Martin · Answer

@Jason Bierman please allow me to share some perspective on mobile home park management.

There are two components of management for you to consider: onsite and offsite management.

As it relates to onsite management, the common and most generic strategy is to interview the existing tenants to find a capable, trustworthy, willing resident to be your manager. That strategy works best if the park is too small for a serious onsite team and you have the ability to watch over the manager. (usually parks under 40 spaces) However, don't expect to get much more than a person who collects rent, interacts with the other tenants, and puts eyes and ears on the park. I would not suggest this generic strategy for a larger park, parks with a lot of park owned homes, or parks that need a lot of work.

For value-add parks with vacant park owned homes, vacant spaces, and one that may have been previously poorly managed and in need of a lot of work, the generic strategy above will not likely allow you to move the needle much. The best approach is to hire a full time onsite management team that is experienced, and capable of performing all the duties of management, home sales, managing maintenance and repairs, and the implementation of software systems and processes that will eventually have the park running like a Swiss watch. This kind of management team will cost more money of course, so a smaller park may not be capable of affording that kind of horsepower. Usually, the break even point tends to be about 40 lots before a full time manager is warranted. If you can afford a great onsite manager, particularly one who has experience turning parks around, they will make your life a LOT easier and will be well worth your money.

As it relates to offsite management (3rd party management) we have found that this solution only works if you have a park that is already stabilized and running at or close to efficiency. However, if you choose to go this direction, make sure to select a company who specializes ONLY in parks and is familiar with all the state regulations. Hiring a 3rd party PM company without intimate knowledge of parks is a recipe for more brain damage than you can imagine. If you have a park that requires heavy lifting to fill spaces, sell homes, complete major capital improvements, etc, I would not recommend a 3rd party. They just don't have the ability to move the needle at the park, nor will they care as much as you do as the owner, so you will be left disappointed with their lack of performance.

With all that said, if your focus is to acquire value-add parks that require a lot of work, I would suggest YOU become the expert and take the role of offsite manager, overseeing the onsite manager. That will allow you to stay engaged with the property, move the needle, and give you the freedom to acquire more parks. This will require you to learn all the ins-and-outs of parks, to include filling up spaces, renovating homes, selling homes (along with licensing requirements), carrying paper, crafting the correct leases and notices, establishing the right park rules, proper tenant communication, metering of utilities, and the list goes on... You can gain some of that experience through education and mentorship, but there is no replacement for running a park yourself.

As it relates to management, just remember that your ability to move the needle will be directly related to the quality of the onsite manager, and YOUR ability to provide the proper leadership, goals for the park, and resources/support to help your onsite staff achieve them.

All the best,

Jack

Cameron Tope · Answer

@Mat Trenchard & @Ethan G. - there may be some useful information on here at some point.