Greetings! I am interested in buying a mobile home park in Washington State. I have sold a couple larger ones from a brokerage perspective, but they were both development plays, so I feel the feasibility was very different than what I will be looking for in buying one as an investment. The part was in foreclosure, someone bought it and fixed it up and about half of the spaces are still vacant but ready to be rented. All spaces are land lease only, part does not own any of the homes (which I was looking for, for my first MHP purchase). I am very familiar with underwriting Multi-Family Apartment buildings and think it would be somewhat similar, but as it was recently distressed I am working with limited financials. Does anyone have any advise on specific things I should be aware of when looking into this MHP in WA State that I wouldn't look for in Multi-Family? Thank You!
I'd buy the 30 days due diligence manual from Mobile Home University. But for starters infrastructure is a biggie as there is a lot more of it (and it's more complex) than with a simple building. Is it on city water/sewer? What are the sewer lines made of and what condition are they in? Water lines? Is the gas/power direct billed or master metered? Condition of the roads?
Zoning can be important too. How big are the lots? Is everything up to code? How old are the homes? Inevitably you will end up owning some.
Shouldn't be too difficult to rebuild the financials if you know the market well. Depending on the factors above and who pays utilities you're likely going to be in the 35-45% range as an expense ratio.
half empty parks are tough.. seller wants market for pads.. but absorption ( or lack therof) will kill you.
I have owned 3 parks.. and am buying one in Eugene right now... I like them but they are not anything like a apartment.. they can be much better if you get a nice one.. or can be a ghetto headache if its west coast which means full of white trash tweaker types.
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