Leasing Pads to MH Dealers


#1

How does it typically work for MH dealers who seek to place new homes on vacant pads in an established park? Do they pay rent from day 1 or only when they sell the home to a resident who will then begin paying lot rent?

Also, short of getting a MH dealers license, is it possible to get paid a commission from the MH dealer for steering a prospective buyer? Possibly by forming a joint venture to sell homes at the park?

I am looking at an asset in the mid-atlantic area which will have 11 vacancies and would like to go the new homes from a dealer route but also maximize revenue.

Thank you for your help,

CFB


#2

Banks (for repos) and mobile home dealers are becoming more creative and engaging the mobile home park owner in many areas of the country. I have seen several mobile home park owners allow the refurbished “ready to move” in repo or new home being placed in their park and allowing 90 days+ of free lot rent. We are currently doing this in one of our parks.

I know on the repo side, several banks have paid 10%-20% bonus to the mobile home park owner. It is almost as if the mobile home park owner has their own mini used consignment lot. I think that the commission is paid as a bonus to avoid issues of not having a license.

Corey


#3

In MD it has worked for us everytime. We have sold 4 DWs and 2 SWs in the last 6 months. I started with one dealer then two. I let them set the homes, take care of all the decks, landscaping and the homes are sold before they get them completely setup. The last new 16 x 80 was sold before the dealer had time to choose the colors. We just took delivery of a home on our last empty lot. To answer your question is “YES” Give the dealer 3-4 months free lot rent, work a deal for you or your manager for commissions, you’ll get a new home in your park and you will be soon getting lot rent for that empty space that has been setting empty for years. JMHO, Good Luck Terry


#4

Does anyone know dealers or banks in the pa area that do this? Thanks


#5

Thank you for your responses.

Dom - I am in Eastern PA and will let you know if I have any success.

CFB