All Forum Posts by: Ryan Groene

do you mean 15-20 lots?? 

cap rates are this small of a park should be in the 10-13% range.  which will give you a cash on cash return of 20%, which is what most investors seek in MHP's.

simple formula to evaluate is lot rent*number of occupied lots*.6 or .7(whomeover pays water/sewer) *12 to get your NOI.  then apply whatever cap rate your willing to pay youll get your purchase price

basic information youll need is lot rent amount, number of occupied lots, and who pays water/sewer(park owner or tenants) also what type of utilities is it, private or public.  also you need to know occupany and how many Park owned homes there are and that rental amount.  

once you get this info you can establish a base price for what someone is wiling to pay. depending on the cap rate that they are looking for and cash on cash return.

MHP's are based on the net operating income of the property, just like self storage, apartments and any otehr commercial real estate.  

@Christopher Fulmer ??

@Kim Knaust just sent you a connect and pm'd you

No problem @Kim Knaust. if you have any other questions please let me know.  I wouldn't say that im experienced as some others on here...still a lot to learn.  I've just learned from some of the best in the business and thats how they start to look at a park.

You could also request to see any profit and loss statements, rent rolls, and any other documents the seller has to help make an evaluation of the park.  just explain it to them that way.

If you talking directly with the seller, some points to bring up to them is that you are going to need more information about the park's operations in order to make an educated offer that the banks will be able to lend on that value.  so assuming you get the lot rent, number of occupied lots, and who pays water/sewer and what the utilities set up is...if its private or public water/sewer.  you can establish your formula and establish an estimated offer amount based on these items.  

formula is a follows....lot rent*number of occupied lots*12(annualize the amount)*.6 or .7(operating expense)=Net operating income

.6 if the park pays water/sewer and .7 if tenants pay water/sewer

once you establish your estimated NOI, you then apply a cap rate that you are willing to pay to it by dividing into that amount and you will get a base purchase price. All banks will look at the NOI and then underwrite the park as so.

so if you want to pay a 10 cap, you divide your NOI by .10 and you will establish your purchase price.

This is all a quick evaluation on what you should pay for the park to establish a price range. you then can add in some other income if the park generate is thru apartments, single family house, Park owned home inventory...and any other things that you would pay for to get the total purchase price.  

@Jack Martin is correct that you should do your own diligence and make sure they meet your own goals before you invest.  I have no affiliation from a promoting standpoint with any of the people that i mentioned before. There are plenty of other syndication's as well out their doing Mhp's as jack mentioned.

identifying a property could be pretty easy as there are a lot on the market right now.  not sure what price point your looking at, and what areas you are looking to invest in.  the reason it takes a little longer when beginning is because there is a limited inventory of parks out there that most would consider investing in.  So it does take longer initially

are you looking to get into mobile homes?  or mobile home parks?  depends on which one and i can point you in the right direction

@kevinbupp and @charlesdehart have a second fund coming available very soon. Jefferson lilly has one as well. And so does frank Rolfe and Dave Reynolds. 

All great Park owners and great people to invest with. Regardless of whom  you choose.