All Forum Posts by: Jim Kimmer

@Jack Martin This is the exact type of input that I needed, and is the sole reason why I posted about this park in this forum. Thank you so much for the time and effort you put into your post. 

Like you said, it will require so much capital expenditure and patience. And the biggest thing is, will it be worth the stress and headache that this turnaround project will require. This park appealed to me because of its quality location, attractive demographics, and the fact that it is just so much harder to find parks these days with so much investor capital on the sidelines chasing the same product. 

I will counter the seller with a Much lower price (sub $180,000) and offer the seller carry terms that you mentioned. The worst thing the seller can say is “no” and then I will just move on. Again, much appreciated. 

@Jason Ray Richardson all points noted. The distance of the park is not as much of an issue as is the overhaul that will be needed to rehab the homes and/or to execute infill of new homes. Like you pointed out, I have thought about posting an ad that will allow a tenant to own the abandoned home if they do all the rehab themselves...and then moving forward, they would pay the monthly lot rent. 

@Don Gouge I agree that older homes pre-1970’s can be a liability. During the walk through, if I deem some of the interiors of the homes to be non-salvageable, then I am planning on demolishing the unit(s) on-site and tossing into a dumpster. However, other park operators have done well by rehabbing older homes (assuming the needed repairs are less than $15,000)...in the end, shelter is shelter—especially with the shortage of affordable housing that is available. 

@John L.  yes, I have contacted 7 different mobile home parks in Indianapolis. 5 of them are completely full, with no lot rentals/purchases available. The other 2 are in B-class neighborhoods of Indy and have brand new mobile home rentals they are offering for $800/month. 

@Account Closed I will have to contact the city to see whether it would even be possible to start from scratch, as mobile home parks in general are not beneficial to the city from a tax revenue standpoint. This park already has a zoning issue since the utilities were shut off 1.5 years ago. But the broker is working with the city to secure and confirm the zoning designation to continue to use as a mobile home park. According to the broker, city approval is pretty much a done deal. Electric amp is 50 amp. Condition of Water/sewer lines are unknown. A plumber would have to snake a camera through the sewer pipes. A better option would be for water to be turned on to the park (water is master metered), so that I can use a hose and blast water into each sewer line on each lot. This would easily confirm viability of the water and sewer line infrastructure. 

Hi all,

Would like to get feedback of a possible mobile home park deal that I have on contract in Indianapolis, IN. 

It is located 4 minutes away from the Indianapolis Speedway, 10 minutes away from downtown, and resides in a C-class neighborhood of Indy. 

11 abandoned mobile homes (1960’s and 1970’s models) on the premises. All of them would be transferred over to the new owner. Exteriors of the home are in average condition. Interiors of the homes are unknown (fire department boarded up the doors and windows to each home). All back taxes owed on the homes will be paid by seller (the bank). This park was abandoned about 1.5 years ago after the owner defaulted on the loan, and hence all utilities were shut off, forcing all tenants to leave. I called the State department of Health and they stated that mismanagement of the park from the absentee owner caused the park’s dysfunction. 

- 18 lots.  11 abandoned mobile homes.  7 empty lots.

- A 3 BD/1.5 BA also resides on the property...which was used as a 2 BD/1 BA and office.

- City water/sewer.  Water is master metered.  No sub-meters installed.

- Paved roads.

- Electrical AMP needs to be updated for all lots.

- Trash utility included as part of property tax payment.

- Market lot rent: $410 - $460.  Market rental rate: $700 - $850

- $250,000 offer accepted by seller, 35% down, 20 yr amo, 7 yr balloon, 7% interest rate. Offer contingency rests heavily on condition of the park and the interiors of the abandoned homes...and assessing whether these homes can be repaired—and if so, will it cost me an arm and a leg to repair 1 or 5 or 10 of them.

Obviously, this is a distressed, non-performing MHP, which has a ton of risk. The positives are the attractive city location within a big, growing population...in a city with strong job growth within the health and education sectors, among other big employers. 

I’d like to get feedback on this mobile home park, and specifically, is it worth my time and money? Or am I better off passing on it? I’m supposed to go to Indy in 2 weeks to visually inspect the grounds and interiors of the homes with the broker and a mobile home contractor. 

I own a portfolio of 2 cash flowing multi-family properties in Southern California, but this would be my first MHP deal. I reside in Southern California.