Help with first mobile home park

[John Kim]

I'm currently looking a 39 lot only mobile home park in the west coast and looking for any advice/help on making a decision on it. The asking price is $850,000. From what I analyzed so far, it seems like a decent deal but I would like to see what you guys think. Here’s some details of it:

Number of MH Lots: 39

Built: 1930

Park Owned Home: 0

Structures on Park: 1 (Laundry+Office)

Water: City (Included in Rent)

Trash: City (Included in Rent)

Sewer: City (Included in Rent)

Total Occupancy: 24/39

Avg rent: $385 (based on current month)

Here’s some history of the MPH I found:

7/16/2008	$1,850,000	Sold
6/1/2008	$1,700,000	Sold
4/9/2004	$761,000	Sold
2/24/2017	$1,500,000	Asking Price
5/23/2017	$1,140,000	Asking Price
??	$975,000	Asking Price
7/13/2017	$900,000	Asking Price
10/18/2017	$850,000	Asking Price

Here are the numbers based on the agent ($9525/month rental income as of today):

Total yearly rent (based on 24/39 lots rented): $114,300

Expenses (agent estimate): $30,000

Management fee: $19,200

The agent said the current owner never kept good accounting and has had some trouble managing the park. He did provide me with the current rent roll, 1 year bank statements, water/sewer/gas/tax bills.

Here are the numbers based on the bank statements for 1 year:

Total income: $82816

Total expenses: $75967

The park isn’t making much profit but if the occupancy stays at its current rate or increases, it seems like a good deal to me. Am I missing anything? The park price keeps dropping but nobody is biting, is there something I'm not seeing? Oh, the agent mentioned that they took over management of the park back in Aug and am actively increasing occupancy. He said he would like to continue as the property manager and their fees are 6%. He also said average rent can be increased to $450.