All Forum Posts by: Samuel Coronado

First step is zoning and asking what they need as well as what it takes to make it happen. Each county is different with its requirements. Mine is like the wild west while the county next to me is a very very different story. I only truly needed permits for driveways/culverts and septic tanks. Everything else is being done by the individual contracting and utility companies. The order of operations would go something like this: 

Zoning/permitting

Financing

Grading the area, draining management

Gravel or paved roads 

Pads creation

Septics

Water lines

Electric

Internet

Mailboxes

communal areas (laundromats, gazebos, bbq areas, walking tracks, dog parks, playgrounds, etc)

Infil of mobile homes

Where I am from, most of the contractors who do septics can also do most of the rough and finish grading as well as any drainage needs. A civil engineer can help you out immensely. I paid about $2k for my small park but there is another investor I know who paid about 12k in all the design fees associated with it. His park is wayyy bigger, though I can't recall the pad count. Mine was about 20 or so that it was designed for. I wanted some healthy space in between them as well. 

To follow up with this: I was able to get the same policy that the park was already under. Actually got it about $50 cheaper due to my credit and insurance history. The policy was through American Modern. I will be looking for additional umbrella policy soon as well. 

I think you've done a great job up to this point. I occasionally shop estate sales for this purpose. I just got a great fridge for $200 that usually goes for $1000. I have a few backup appliances so when one goes down, I can immediately switch it out and then fix it on a less stressed timeline. These appliances aren't the same brand or clout as the originals, but they're just stand ins. Tenants are customers. I am sitting at 90% retention over the last 10 years because of the small details. 

How are the losses shown? Capex? Depreciation? Major repairs? If you've kept strong books with receipts, a P&L, and other documents, it may be easy to show the correlation and how the value added results in a higher valuation. I would also look into using a niche broker if I were you. They have the resources to market it to a ready to buy list. I'd also be interested to see what the numbers look like. I'm in the market for another park.

I think there is a lot of opportunity in this deal.  Mobile homes are often slept on, so there may or may not be as much competition in your local market. I know in Alabama people aren't exactly clambering to buy up all the mobile homes like I am. haha. I would love to see the numbers of this deal if you care to share them. I can also tell you some things to watch out for. I usually have a partner come along with me to do an inspection. I once crawled under a trailer while my partner turned on all the faucets to check for leaks. One of the drain pipes went directly to the ground and didn't feed into the main drain at all. At all! That was a fun discovery. It was a high shock item with a lot cost fix that helped me in the negotiations. These aren't as complicated as normal homes, so you should be able to do it without a professional inspection, minus the septic (which you shouldn't be responsible for if you are only renting the lot vs buying the land). 

 Definitely. I tried having the policy that was currently on the one under contract rewritten for me. I figured it would be easy for all parties since that broker already has all the info needed, but the customer service at American Modern has been lacking a bit. I'm not sure what the issue, but I'm all about focusing on the things I can control. I can't control what they're doing over there, but I can control whether or not I explore more options from the rest of the market. haha. 

Forgot to add: Look at GreenSky for rates on home renovation. They gave me 2% for 10 years on a 20k loan. Very great terms as the tide was starting to come in from the rate hikes. Not sure what it looks like now.

Every RV park I see is based on an earnings multiple and not based on the income approach to the point there is not a day 1 profit from the end buyer without a large capital injection. By creative financing, what are they open to? Is there an assumable mortgage? Does the current mortgage have a balloon like a lot of commercial mortgages that are coming up now? I spoke to one guy who went from a 5% and may be going to a 12% soon on that refinance. It's not looking pretty. Commercial real estate will take a big equity hit, but there will be a lot of opportunity out there as a result! 

I was putting feelers out and found someone who has 8 figures of property over their short life and is looking to exit. I was very upfront and said they were above my level, but I would love to sit down and have a conversation about how a young (29 year old) person can get there these days. I often extend this invite to people who are echelons above me, but don't often get a bite. This person agreed! Now I need to get some questions and conversation topics ready. They own and operate multiple million dollar commercial property around my area in my specific niche (mobile home investing). What would you ask this person?

 How much did you pay for that park? How has it worked out since then?