Hi.
I have a Letter of intent written up by a broker on an off market deal were the seller is going to take out the commission from the sale.
Structure of the offer is as follows.
-Price 2.15 Million
-mix of RV’s and mobiles 100% full with calls asking for space.
-450k down, seller to carry the balance at 5.1% , 25year amortization, Balloon Due in 8 years.
-Pad rent produces $17,000 per month which is conservatively 15% below market value from comps.
-City is 90k plus in population and growing with a super Walmart less than 4k away.
My intention would be to first try and purchase the park myself, shopping around for the 450k down at a 10% return hard money which the income should support.
Or wholesale ?
I am moving forward being conservative as possible on numbers.
Anyone who could rank this deal 1 to 10 and or have some input on this deal would go a long ways in boosting my confidence.
60 days due diligence.
The Seller won’t let you use a hard money lender for the down payment, otherwise they would have offered you those terms themselves. And they will want a first position lien, which the hard money lender won’t accept.
Hi
Thanks for the reply.
As it stands the seller is not aware of were the down payment is coming from and I believe they want some liquid cash to play with from the sale, but some negotiation is still happening.
@oceanview - A little more info would help in giving you a good answer:
What is the ratio of RVs to MHs?
Are the RV spaces also suitable for MHs?
City Water / Sewer? Who pays?
What capex do you anticipate in the next 1-10 years?
hi
sorry for late reply have been on the road etc.
yes the numbers are tight from day one, good comps support a conservative 15% increase and there was a one time 22k construction cost last year on the numbers i have so far .
tenants pay all utilities.
Thank you for getting me to look harder at the numbers i have a half hour conversation with the broker today on your points plus other.
I will have to add to this post later as i’m in a noisey room and had a long day!
During due dillagence i may have to change numbers,
Hi
not sure on how to PM on here yet but to let it be known after some long negotiations the seller has backed and has elected to wait a year before selling .
If you are interested in selling the park off-market (wholesale) I can help you. We can both get paid a fee if the transaction closes. Call or text me if you are interested in talking on the phone about it.
Hi Trevor
I think I responded on the wrong platform here?
Hope you receive this and I would be interested in selling this deal but the owner has backed out, only to say they want to wait a year before selling.
I will keep you on file and see how it develops.