Mobile Home Park Renovation

[Kenneth Harrington]

I have come across a 117 site mobile home park that is in need of renovation. It is now rented at a 30% capacity. The site has great potential and would be a great investment once the park is updated. Preliminary estimates on Renovation are about 200,000 which I have and am willing to put into the park. The park is on 9.3 acres and  has been in threat of being shut down, unless renovations are made. I am looking for an investor to put up the needed 600,000 to buy the park. I will get the park in compliance and rented, then we together will resell the park for about 1.8, which is still a conservative resale considering the rent is 450 per lot and has a great cap rate. Any interest, please get back to me.

Ken

[Jay Hinrichs]

@Account Closed  from my point of view based on the discussion  200k to turn this around and create spaces that are worth 500 a pad would not be near enough..

I just did a turn around on one in ORegon I bought.. same thing old family owned it totally neglected

I put in all new power hauled off 6 trailers rehabbed a few more there was a home I took to studs and remodeld an apartment.. fencing utls clean up.. and I added 3 more spaces.. and I spent about 85k on this work.. so that park being that big I would think if you have to deal with 40 or 50 derelict trailers new electrical.. etc would cost far more than 200k.. just a guess.  Now my electrical was all new poles and box etc.

so at the end of the day I have 17 spaces a 2bd 2bath home that rents for 1200.  apartment rents for 700 .. 10 HM's owned by park at 600. each.. 7 new spaces at 350 each.. so about 10k gross.

at the end of the day I think I will have about 220k all in.. purchase and rehab.  I am thinking this is a decent deal to keep.. Oregon is pretty solid rental area.. although this park was full of tweakers who I have since evicted. 

You guys in the business what kind of cap rates do these style of parks cook off at ?  just curious.

I have a park next to mine that has been repositioned and is very nice.. he offered to buy it from me but not at a price I felt was a good enough return on the time we have spent goofing around with this and dealing with the delightful hold over tenants.

If this goes well I might target more of these.

I owned a 44 unit in Vancouver WA it was a dream completely the opposite bought from a family who owned it day one.. EXTREMELY diligent who they let in.. I was able to sell that to a large West coast park owner for right at 2 mil...   that was a good one for us.