All Forum Posts by: Mario Dattilo

☝🏻 Frank’s #5 is expensive but a huge life saver. AKA business interruption coverage  

We lost a self storage facility (TOTALED) in hurricane Michael and that was a big part of the claim. Be sure to get extended period of indemnity for as long as you can get it. 

Insurance sucks until you need it, then you are thankful you have it. Heavily insure your property. 

Look at demographics. If median Income for the zip code is low (less than $35k +/-), if market rents for a 2 or 3 bed apartment are pretty low under $600 and you see all the other parks are rental communities those are good signs that it is a rental market. One of the strongest indicators is home sales are sub $100k. If you’re seeing single family homes selling for $50k nobody is going to want a mobile home with rented land for the same price (and similar monthly payments). The numbers above are not hard and fast but when I see them below those I know it’s probably not good. 

If the market is checking the boxes above as more of a low income rental market I wouldn’t recommend buying it. Rental communities are more like horizontal apartment buildings and without getting into valuation you can end up overpaying compared to what a lender, appraiser, or future buyer will value it at. It will come with a higher expense ratio, a lot more turnover, more management intense, a lot of make ready costs, and require most staff/payroll. It kind of defeats the purpose of buying a MHP. 

Hope this helps. 

Hey Robert! Sounds like you got a lot of moving parts on this deal but the first I would look at is the market. Is there enough demand by doing a test ad. I only say that because you said it was rural. I think the next question is will there be demand for an ownership model. Often in rural markets the rental model is the only route. I would recommend reconsidering buying in those markets as the rental model is not ideal for too many reasons to list in this post. 

When you say septics, do you mean all the septics need replacement or a select few?

Are your lots large enough to support replacement septics? You dont want to get in a position where you need to remove homes to install septics.

Based on $300 lot rents (assuming that is market and the market supports lot rent model) it doesn't sound like a bad deal. 

Sell the trailers. Bring on an equity partner or affordable debt. Dont take 12% hard money. It isn't necessary.

I'll PM you. We may consider partnering with you on this one.

@Mark Rechkemmer make sure you are calling the right group in the DMV that handles MH titles. Shouldn’t be too difficult to get this answered. An alternative route would be to call a mh title company that works in NC. We use snickfish. They work most states and could give you instructions and handle it for you.

What you are looking to accomplish if file for an abandoned title which will get a new title issued in your name so you can take ownership, fix and sell it or demo it.

This is something every park owner deals with and honestly titles are one of the biggest pains in the *** in our business because every dmv office (even in the same county sometimes) handles things differently and they rarely know what they are doing.

A visit to the DMV in person should get you what you need if phone calls are getting you to the right person. Hope this helps!

Are there MH’s on your parcel already? You need to get with the zoning department and likely a land use attorney to see what the property zoning is and the number of units they will allow. It’s not as simple as just placing homes on your land. They will likely have requirements such as setbacks etc that will determine where you set the homes etc. you are asking to develop your parcel into an MHP. 

@Juanita Bell what is your zoning? Does it have other mobile homes on it?

Hey @Sunny Abbasi! We own multiple mobile home parks around Atlanta. Happy to help. PM me. 

@Nathan Barshinger one thing I don’t think anyone has mentioned yet is don’t buy a park you don’t have the time to manage (and manage the manager). Turn around parks do take some time and effort and if you have a full time job you just need to assess your availability to see the plan through.

Mobile home parks can become fairly passive when they are stabilized but the repositioning of the property can be a bit intense depending on what is needed.

If you are buying a park that needs a lot of infill, capital improvements, a lot of vacant homes needing rehab and sale then consider partnering with someone who has the availability and complimentary skills to yours.

The catch with partnering is there is also risk in that so make sure you trust and vet the partner and make sure it is structured in a way that you are both adding value equal to your interests and are not both doing the same thing where you are stepping on each other’s toes.

I bring this up because we have bought parks from people who thought the turnaround was easy and didn’t understand the time commitment required in the beginning. They realized it after buying it and then had to sell.

Alternatives to partnering would be to invest as an LP in syndications or funds that are focused on this space. Same rules apply with vetting and trusting the sponsors.

If you have the availability then by all means go buy them and operate them subject to all the other great caveats that others have been commenting.

Hope this helps.

@Brendan Hula what @Frank Rolfe said. Get multiple bids and recognize an overlay is different than a first time paving of the roads. With price increases happening across all labor and material figure in a little room for them to come back and increase it on you before their contract gets signed.

Any time @Steven Vitrella. What states are your deal in?