All Forum Posts by: Charles Chester

Its been a while so figured I would update this thread.  After a lot of time an effort I have to pull the plug on this project.  Our original lender pulled out of the deal.  I scrambled to find another option.  Two other lenders gave me options with the final lender willing but with a larger cash injection than I was comfortable with.  

@Frank Rolfe was right and I should have listened a little more.  It was naive or ignorant of me to think with 20% down and 800+ credit the loan was the last thing to worry about!

The industrial expansion that is planned has still not been publicly announced, so maybe theres a silver lining.

Moving on to the next one

With an image overlay.  This shows the existing school to be demo'd.  The structures are in good shape.  I wish converting them to condos/apartments wasnt expensive.

This is the plan that will be submitted to City Council for approval and permitting.

Mike I took your advice and made all the interior spots pull throughs on Phase II.

I spent a lot of time in the Cherino area. 
The interior border is the 20’ setback from the property lines. It is to scale what that scale is in the image im not sure. 
I have laid this thing out so many times I have a few with pull throughs. I may be a little congested good point. 
I have the roads at 40’ wide. I used a park in Katy as a goby. The West Orange ordinance is pretty lenient.

Here is a snip from my model of the property.  The white hatch patterns represent existing buildings or concrete.  Blue & green are RV spaces.  20x40 each.  This is complete build out and best case.  There are a couple of spots that need to be omitted that are not practical.  The outcome of the asbestos survey and inspections will determine which building if any we can reno for office, laundromat & common areas.

Quote from @Adrienne Bryson:

Quote from @Charles Chester:

I was never planning to own the actual homes. Just the dirt and maybe that is an issue  

Mobile homes fit the demographic pretty well, there is half a dozen mobile home dealerships a short distance away.  This may not be a great indicator as I first thought  

I am about 100 miles east of Houston. 

I’d be happy to share my spreadsheet if you’d like to glance at it. It’s pretty detailed and versatile and may be a useful tool for you if nothing else. 

Charles

 Charles,

Did you end up progressing with this? I have toyed with the idea of building a smallish mobile home park with most if not all tenant-owned homes, but everyone always says buying existing is better than building new. I'd love to see what you've come up with in your research.

We pivoted slightly from the discussion above. I hope that property stays available though. 
We are under contract on a piece of property now and in the DD period.
The reason We changed is due to Chevron and the upcoming expansion planned. We changed to RVs instead of homes for the workers that will be in the area.   My goal is to develop and sale I’m not an operator. 
A little background on the property. It is an old school house that has been vacant for 15 years or so. There is about 50k sq ft of buildings that need to be demo’d. The structure is in good shape really but the money to convert them to a multi family gets up there. With the price of concrete it is less expensive to tear them down and use the slabs for RV spots. 
The property has beautiful live oaks and the connections to the utilities are already there. 
The property was listed at 450k I offered 350k we settled in 365k. I have the construction cost broke down in several options. If you’d like more on that let me know. 
It will hold just above 100 RVs. With the location being so close to the refinery spots will fetch 550-600 a month. 500 is the going rate it seems. 
I will try to document the process as best I can 

Quote from @Paul Moore:

@Charles Chester that $7 million railroad deal seems like a play for very experienced people with deep pockets. I applaud you for walking away. Even if it’s a great deal for someone. The risk has to be huge. 

I like your idea of storing mobile homes and I would like to hear more about that. I know someone who does that for their own mobile home park business, but I’ve never heard of anyone doing it as a third-party. Can you tell us about your plan to acquire the homes, and then how you plan to use or sell them? 

@Paul Moore good morning, sir.

I may have worded that in a misleading way.

I plan to develop a mobile home park.  The property is 10 acres and the purchase price is roughly $12,000/acre. The preliminary layout I put together has 70 spaces, completed in phases, expanding with demand.  Spots are brining $250-$300/month.  I do not want to own the homes, only leasing the dirt.  I have had a preliminary meeting with the county and have the city is next.  

After a little research there are programs, HUD offers to encourage these developments. There are strings attached when dealing with the government for sure. I will let you know how that shakes out.

I know it will take time to fill up 7-10 years probably.  Most people say just buy an existing park, but I am a developer/builder by trade.  I enjoy the process, from concept development through design and construction.  The goal is to sale at or near full occupancy. 

Originally posted by @Mark Wooldridge:

A lot of due diligence will be required - one big one:  What kind of base is under the tracks?   This was originally built as a rail car manufacturing and repair facility, so the base may be just enough to handle empty cars - Fully loaded cars could be an entirely different matter - If the base isn't sufficient for the weight, big problem.

Very good point. 

There are several companies that own railcars no doubt.  There are railcar storage facilities but most offer other services.  I didn't want to get into that.

I did submit an offer on a tract of land that is 1/2 mile away.  Going to store mobile homes instead.

Originally posted by @Paul Moore:

@Ronald Rohde this is an idea I’ve never thought of.  Storing rail cars?!  Wow, thanks for enlightening us, @Charles Chester. I would have to guess that the demand is inconsistent, however if there are waiting lists for these opportunities year in and out perhaps it might be something to consider. Can you share the math on this one so we can discuss it here?  Sale price.  Capacity. Typical occupancy. Etc.  thanks. 

One of the major "pros" for this site, is it located right on the edge of a major port and a rail loading terminal.

Sale Price - 7mm

Capacity - 440 railcars (roughly 5 miles of track)($250-$300LF for new install)

Rates - $5-$20 per day per railcar (several variables)

Occupancy - This is a tough one.  Conservatively 50%.  The image below shows it full.