Mobile Home Park Investing in 2020

[Ephraim Bistritzky]

Hey -

What does everyone think of mobile home park investing in today’s market? considering the recent consolidation and the limited supply do some of you seasoned professionals think it may be “too late” to start a MHP ownership career now? I have experience in acquisitions, dispositions and management.

If not - how do I go about finding an asset to purchase. I have experience in a few sectors of Real Estate and understand the underwriting process and have read enough about the differences between MHP’s and regular assets so I believe I somewhat understand that end of it (still have much to learn but ready to asses properties). My issue is I can’t seem to find any deals on the normal market where I would normally find my MF / Retail / Office deals (Loopnet, Crexi, CBRE, JLL, M&M, RCM etc.). All the deals on these “marketplaces” seem to be extremely overpriced and are priced out of the value they offer. The more research I do the more it seems the only way to truly capitalize on this niche asset class is to find off-market deals. Luckily, I have the equity sources for quick closings so I believe I can make that part of it work. I just do not know where to start on the deal sourcing side of it. I’ve never had to work to find a deal before typically there were always way too many deals on my desk. Not too few.

Looking forward to hearing from the BP community.

[Frank Rolfe]

The mobile home park market is still alive and well despite Covid-19 and urban unrest. It is barely consolidated (institutional investors only own roughly 4,000 of the 44,000 mobile home parks in the U.S.). But you are correct that 90% of the deals on-line are overpriced and the only way you'd buy one of those is if you could convince the seller to drop the price substantially (which does happen once it's been on the market awhile.

The top places to find a park today are:

#1 BROKERS. Of the 300+ parks we've bought, over 50% came from brokers (mostly pocket listings).

#2 COLD CALLING. This is where roughly 50% of the other half came from.

#3 DIRECT MAIL. This is where roughly the other half of the half came from.

Since the mobile home park market is weird and fragmented, your typical sources of deals will not be of much help. There is a little more effort required to successfully buy mobile home parks -- it's more like going to garage sales than buying out of a Neiman's catalog.