Structuring Equity for a Mobile Home Park Infill Partner

Mobile Home Park Investing
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Structuring Equity for a Mobile Home Park Infill Partner

Bryan SargentPro Member
Member since 2024 · 1 post · 1 vote

I’d appreciate some input from those who have experience developing and infilling manufactured home communities.

I currently have a new mobile home park that is fully entitled and ready to build. The construction loan has been approved, and we are ready to move forward with the buildout. I also have a line of credit in place with a chattel lender to purchase and stage homes as the community is developed.

I’m comfortable with everything up to the point of placing and selling the homes. Where I lack experience is the actual infill process—selecting and ordering homes, coordinating delivery and setup, managing completion, marketing and sales, buyer financing, and getting the community to stabilization.

I’m currently negotiating with experienced people who could take responsibility for that portion of the project, and I’m considering bringing the right person in as an equity partner rather than simply paying them a fee.

My question is: What percentage of the project would you consider fair equity for an experienced partner who brings the knowledge, relationships, and execution necessary to manage the infill through stabilization?

Assume that I am bringing the entitled project, the development, the construction financing, and the credit facility/capital necessary to purchase the homes. The incoming partner would primarily be bringing their experience and taking responsibility for executing the infill strategy.

Would you consider 5%, 10%, 15%, 20%, 25%+ of the project reasonable? At what point would you feel that you are giving away too much equity for this role?

For those who have structured a partnership like this, I’d especially like to know what percentage you gave up, exactly what responsibilities the partner assumed, and whether you felt the arrangement was worth it after the project was stabilized.

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Denise SuppleeBusiness Member
Realtor · Willow Grove, PA · Member since 2017 · 987 posts · 645 votes
2mo

Hi Bryan, this is close to a partnership structure I've seen work well in development stage deals. When the incoming partner is handling infill execution, sales, and buyer financing but not putting up capital, I've typically seen equity land in the 15 to 20 percent range, with the higher end reserved when they're also taking on delay or cost risk. Since you're carrying the land, construction loan, and chattel line, I'd start the conversation at 15 percent with a bonus tied to hitting stabilization on schedule. That keeps their incentive aligned with getting units placed and leased fast.

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  • Denise SuppleeBusiness Member
    Realtor · Willow Grove, PA · Member since 2017 · 987 posts · 645 votes
    2mo

    Hi Bryan, this is close to a partnership structure I've seen work well in development stage deals. When the incoming partner is handling infill execution, sales, and buyer financing but not putting up capital, I've typically seen equity land in the 15 to 20 percent range, with the higher end reserved when they're also taking on delay or cost risk. Since you're carrying the land, construction loan, and chattel line, I'd start the conversation at 15 percent with a bonus tied to hitting stabilization on schedule. That keeps their incentive aligned with getting units placed and leased fast.

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  • Dominic Mazzarella
    Investor · Hendersonville, NC · Member since 2016 · 498 posts · 285 votes
    2mo

    I’ve owned and operated parks, though I have not done a ground-up infill project at this scale. I’d be hesitant to think about it as “what percent is the experience worth?” and more as “what outcomes is this person actually responsible for?”

    If they are just advising you, I would not give up much equity. If they are truly owning the infill process through stabilization, choosing homes, coordinating setup, managing contractors, handling sales/financing, solving delays, and staying accountable until the community is performing, then equity starts to make more sense. I’d probably want a portion tied to milestones rather than giving the full piece upfront. Something like a smaller base equity position with additional economics earned as homes are placed, sold or rented, and the park hits stabilization.

    The big thing I’d define clearly is what happens if the infill takes twice as long, homes sit longer than expected, costs run over, or the partner loses focus. In a role like this, the right person could absolutely be worth more than a fee, but only if their upside is tied to actual execution and not just “I know the home dealers.”

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  • Vijay FriedmanBusiness Member
    Miami, FL · Member since 2026 · 766 posts · 122 votes
    1mo
    Quote from @Bryan Sargent:

    I’d appreciate some input from those who have experience developing and infilling manufactured home communities.

    I currently have a new mobile home park that is fully entitled and ready to build. The construction loan has been approved, and we are ready to move forward with the buildout. I also have a line of credit in place with a chattel lender to purchase and stage homes as the community is developed.

    I’m comfortable with everything up to the point of placing and selling the homes. Where I lack experience is the actual infill process—selecting and ordering homes, coordinating delivery and setup, managing completion, marketing and sales, buyer financing, and getting the community to stabilization.

    I’m currently negotiating with experienced people who could take responsibility for that portion of the project, and I’m considering bringing the right person in as an equity partner rather than simply paying them a fee.

    My question is: What percentage of the project would you consider fair equity for an experienced partner who brings the knowledge, relationships, and execution necessary to manage the infill through stabilization?

    Assume that I am bringing the entitled project, the development, the construction financing, and the credit facility/capital necessary to purchase the homes. The incoming partner would primarily be bringing their experience and taking responsibility for executing the infill strategy.

    Would you consider 5%, 10%, 15%, 20%, 25%+ of the project reasonable? At what point would you feel that you are giving away too much equity for this role?

    For those who have structured a partnership like this, I’d especially like to know what percentage you gave up, exactly what responsibilities the partner assumed, and whether you felt the arrangement was worth it after the project was stabilized.

    @Bryan Sargent
    I’d tie the equity more to execution and milestones than just a flat percentage upfront. If their role is taking the community from home selection through delivery, setup, sales/lease-up and stabilization, vesting equity as specific occupancy or stabilization targets are hit could help keep everyone aligned.

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  • Kasing Ng
    Accountant · San Francisco, CA · Member since 2026 · 94 posts · 50 votes
    1mo

    Hi Bryan—classic development dilemma. You have handled the heavy lifting (land, permits, capital), but infill execution can easily stall a project.

    The biggest trap is giving a flat equity percentage upfront. If they drag their feet, you are stuck with an unearned partner taking a permanent piece of your cash flow.

    Instead, structure it like an institutional JV:

    • - Base Equity: Keep it heavily weighted to you (e.g., 90/10).
    • - Performance Promotes: Tie their upside to speed and occupancy milestones (e.g., hitting 80% occupied lots in X months). If they do not deliver, they do not earn the back-end equity.
    • - Lean Infill Fee: Cover their operating overhead with a per-pad placement fee during lease-up rather than giving away equity early.

    Make sure your waterfall model maps out how that promote triggers post-stabilization—and don't forget to account for exit taxes once the park stabilizes.

    Curious how you are weighting performance hurdles vs. flat equity in your current term sheets?

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