Making an offer on a trailer park.

[Brandon Malbrough]

I’m looking at purchasing a small trailer park. Would you run the numbers just like you would if you were purchasing an apartment complex or evaluate each unit separate?

[Neil Schoepp]

@Brandon Malbrough

This is the method I use.

So you may or may not have all Tenant owned  or all park owned or a combo or the two.

Take your pad income minus your expenses and divide by your cap rate. (Just like apts.)

If you have any park owned homes you will have to value them individually. DO NOT pay a cap rate on the rent the park is charging for the home. You will way over pay for the home. 

If the park also comes with a small stick built house then that will be valued out separately also.

Now add your three values and start your negotiations.