Investing In Mobile Home Park In Illinois

[Linh Khuc]

Hi All,

I'm from Illinois, have been focusing on commercial multifamily investing and I came across MHP in Illinois, I ran through the numbers and it looks pretty good, details is following:

-  5 acre lot, 30 lots and converted to 24 due to city requirement.

- Lot renting only, tenants bring their own mobile home

- Rent is running ~$365/month, 85% occupancy, 15.5 % cash on cash return

- City water & sewer, gravel driveway

- Tenants pay trash, gas, electric, Park owner pay water

From little I know about MHP, I think the following:

-Pros: good on cash return, low maintenance (not having to manage the mobile home), only manage the lot (trees, snow removal...)

-Cons: tough to find new tenant (they need to bring their own mobile home), gravel driveway will be tough to shovel during the winter

Is MHP a good investment in the Midwest, especially in Illinois ?  

[Mario Dattilo]

The most concerning issue I see at a glance is the fact that it is in the socialist state of IL. Chicago MSA is the highest risk but you are taking on unnecessary risk buying in that state. 

Some people are comfortable with it either because they already own real estate there or live there but we avoid that state along with CA and NY. 

*Get familiar with the landlord/tenant laws in that state regarding mobile home parks during due diligence by consulting with an attorney and determine if you can get comfortable with it.

Hope this helps! Check out my profile for some resources you can use to learn about mhp investing.