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We’ve been buying mobile home parks for over 20 years – but never in Florida. Sure, we’ve seen deals in Florida on a continual basis. But Florida parks frequently have extremely high prices and often difficult issues such as private utilities or master-metered electricity, in addition to a large number of RVs or even weekly rentals. But in 2016 we purchased our first Florida mobile home park. Here’s why we bought it:
- It has city water and sewer, which are directly billed by the city itself to each lot.
- It is a pure mobile home park, with no RVs or weekly rentals.
- It has 137 lots with 78 occupied, which gives us upside in renting 59 lots.
- It has lot rents of $363 per month, which we have raised to $393 on current residents, and which can be raised to $465 per month over time.
- All new residents will be paying $465 per month (which is closer to the market rent)
Here’s how the numbers work out. At the price we paid, we bought it at around a 7% cap rate. But between filling lots and raising rents to market, the cap rate will rise to around 15%. And this is on a senior community that has an attractive appearance. That should increase the value of the park by around 100% -- and we think we can complete the project in less than three years.
If you want to learn how to identify, evaluate, negotiate, perform due diligence on, re-negotiate, finance, turn-around and operate mobile home parks in Florida or the other 48 states (there are no mobile home parks in Hawaii) then consider attending our Mobile Home Park Investor’s Boot Camp in Orlando, Florida on January 13th, 14th and 15th. It’s an immersion weekend that is taught – both in the classroom and in the field inside real mobile home parks -- by Frank Rolfe who, with his partner Dave Reynolds, is the 5th largest owner of mobile home parks in the U.S. with over 250 mobile home parks in 28 states.
Affordable housing is one of the biggest challenges in U.S. real estate – and one of the biggest opportunities. Learn more about the investing options in this unique sector.
To reserve a ticket for the Mobile Home Park Investor's Boot Camp in Orlando, FL on January 13th-15th 2017, Click Here or call us at (855) 879-2738.