Developing mobile home parks from raw land in Austin, TX

[Christopher Gilbert]

Has anyone ever developed raw land into a mobile home park in the Austin, TX area?  We come across land deals from time to time and wanted to see what types of expenses typically go into getting the land ready (zoning, utility taps, roads, etc.).  Does anyone know of any good books, websites, etc. that specialize in this type of development?

[Scott Sutherland]

I have a client in Lockhart selling something similar. He put 3 double wide homes on an ETJ 10 acre lot. In that county we can have a maximum of 1 structure per acre based on the sanitation limitations. So 10 double wides would be the maximum. We also have deed restrictions limiting the structures to double wide only. so we can't add single wide units. 

His development Costs break out like this:

1. Used Double Wide $25K each

2. Delivery $5K per unit

3. Site prep $2500 per unit

4. Electric Pole $1500 per unit

5. Septic Install (1/2 unit). $4000 (we can use one septic tank for 2 units).

6. Water Lines, water meters, Road access: I think he has about $20K invested for the site.

7. Land Cost $60K for 10 acres

Challenges we've faced:

• Flag lot doesn't allow for subdivide
• Financing is tricky (20 year amortization and 75% LTV are typical

Renting them has been very easy. He's getting $800-$850 per unit and I've seen up to $950 per month in the area.