Evaluating park in OK

Hi,
My partners put a 33 space park on 3 acres in Oklahoma under contract. Supposed to close by end of the month and we are still trying to get financing on it. I’m out-of-state and doing a JV with them to come up with the down payment. Here are the details on the park:
6 TOH, 29 POH, 1 ancillary structure, lot rent is $170.

It is currently under contract for $500k. I’m concerned that the park is not worth $500k, the homes would need a lot of work, and my partners and I don’t have any experience with running mobile home parks. However, the park would still cash flow at that price (depends on the financing of course). We can increase lot rent because it is between 30-40% under market. We can also bill back the water.

Appreciate any feedback on this deal as far as valuation and risk.

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Is seller financing available with good terms? Might be best since you are so uncertain here versus having a full recourse loan on it… Sale price definitely works if you can push rents 30-40%. How sure are you that you can convert the POH’s to TOH’s, do comp parks have a lot of TOH’s? Also, have you finished DD and been inside every single POH at the park? What kind of shape are they in?

Seller financing is not available. I’m not sure about other parks in town as far as how much TOHs there are. Not much due diligence has been done at this point to be honest. My partners insist on getting the financing first then due diligence will come after. No one has seen the inside of these homes yet. There’s deferred maintenance like road repair and missing/damaged sign.

For that many POH’s I would not close until I saw the inside of them all or (my DD team sees them). I don’t like not knowing what I am about to own. I’d slow it down, get more time for DD. But that’s my opinion.

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