Buying land leased to mobiles

[Robert Crossley]

Hey everyone, wanted to put some info out on a deal I am closing currently. Feel free to provide any feedback and I apologize if I don't have all the details listed. So I laughed at my agent when he sent me a mobile park but then I looked a bit deeper at this deal and got pretty excited. The deal is for a 15 acre plot in South Carolina, 30 minutes outside of myrtle beach. The land is divided into 24 lots that all have their own septic, electric, water etc. each lot is leased to people who own their own mobile homes and they pay a monthly rent for just the land of $175 (which is a bit under valued should go up to $200) owner takes care of absolutely no maintenance, utilities, structural insurance, etc. 23/24 lots are filled with long term leases in place. Here is what I have projected Land cost $280,000 Down payment 100k, at 5.25/ 15 years Vacancy 10% Repairs 10% Capex 2% PM N/A (will explain) General Liability Insurance $800/year Prop taxes 1.4% (land only) Misc cost $160/mo So factoring in any capex and repair is me being conservative, as I explained I am responsible for very little but do have options down the road to clean the place up, maybe even buyout some of the homes to make the land overall more attractive and more profitable. The land is 5 minutes from my families home in SC so even without that the Property management is minimal but they will be handling all the rent collection and anything else that may arise. They are actually going to contribute to 25% of the deal so they have a vested interest. Here is how it plays after those projections Vacancy-$420.00 (10%) Trash- $80.00 (2%) P and I $1,515.31 (36%) Capex-$85.00 (2%) Repairs-$378.00 (9%) Insurance-$70.00 (2%) Property tax- $338.33 (8%) Total Expenses 2,886.64 (69%) Cash Flow $1,313/mo Cash on Cash return 15% Total return annualized 19% Been over this a lot and I still really like it, there is a lot of other upside potential as well. To those who are going to ask why put so much down or why do a 15 year...I'm not greedy and capital isn't a main problem form me...I'd rather build the equity faster and pay less interest . Questions, thoughts, concerns?