Rental Property Investor · Las Vegas, NV · Member since 2016 · 18 posts · 4 votes
Hey all...
My background is as both a real estate and mortgage broker since 1990. I am interested in updating our underwriting guidelines on MHPs where it pertains to the inevitable mixed-use looking park. It is common to see a MHP that also has SFRs (1-3 buildings), small multi-family (2-3 ,maybe 4 units), RV park and/or Self-Storage all on the same APN. I need to know how a commercial lender would underwrite NOI (income/expenses) on such a mish mash of asset classes under one U/W umbrella. I would imagine each asset class is underwritten as if stand-alone (potentially using a 2-3 year average on NOI on the RV due to wide swings in occupancy, etc.) then mashed into one big NOI. But, I have no idea and most commercial lenders we know sit on that information as if it were a lithium mine they had sole ownership of. Other asset types we buy are 10-50 multi-family (pretty straight forward on the U/W side), Self-Storage (new to this asset, wonder if there are underwriting nuances I should be aware of), Senior Care and Hospitality.
I appreciate any feedback or resources on this topic. Enjoy your weekend!
From an investment sales perspective, underwrite each use independently to segregate the NOIs. Then identify the market cap rate for each use. Lastly, combine those into a weighted average cap rate for the entire project.
My background is as both a real estate and mortgage broker since 1990. I am interested in updating our underwriting guidelines on MHPs where it pertains to the inevitable mixed-use looking park. It is common to see a MHP that also has SFRs (1-3 buildings), small multi-family (2-3 ,maybe 4 units), RV park and/or Self-Storage all on the same APN. I need to know how a commercial lender would underwrite NOI (income/expenses) on such a mish mash of asset classes under one U/W umbrella. I would imagine each asset class is underwritten as if stand-alone (potentially using a 2-3 year average on NOI on the RV due to wide swings in occupancy, etc.) then mashed into one big NOI. But, I have no idea and most commercial lenders we know sit on that information as if it were a lithium mine they had sole ownership of. Other asset types we buy are 10-50 multi-family (pretty straight forward on the U/W side), Self-Storage (new to this asset, wonder if there are underwriting nuances I should be aware of), Senior Care and Hospitality.
I appreciate any feedback or resources on this topic. Enjoy your weekend!
Douglas
We’ve purchased several self-storage facilities that had industrial warehouses or houses on the same parcel. We (as well as the appraiser and UW) underwrote each asset separately. Each asset had its own NOI and cap rate. We haven't received any pushback from banks about the mix.