Deal:
South Carolina
50 pads, No POH
lot rent: $250
90% occupancy
Other parks in area avg 94% occ. with lot rent of $300
Sellers wanting to retire and travel; will owner finance at 6% I/O with a 5yr. balloon (20% down)
City water and sewer; metered and billed to each tenant by the city
Before I am able to get the financials, etc. to do my due diligence, this is what I would come up with:
Yrly Gross: 150,000.
Actual: $135,000.
Expenses: $40,500.
NOI: $94,500.
DS: $45,360.
Net: $49,140 ($4095/Mo)
My offer price would be $945,000. (cap rate of 10)
So, my questions are:
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Are my numbers anywhere close to what you experienced peeps would come up with before actually doing thorough DD? Am I on the right track?
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If my numbers above were actuals, wouldn’t this be considered a good deal? Would any of you be interested in it?
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In the above, the seller carries 80%. Assuming I find a FF that has $189,000 for down pymt, would it be fair to offer them 50% of monthly net with them having no management duties? (and also 50% of profits realized at sale)
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Assuming that is fair, would we be paying interest monthly on his down payment money like it is a 2nd mortgage?
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If we were able to raise lot rent to $300 like all the other parks, how long would we have to season until we could sell the park at that raised value? Same question if we filled the 5 vacancies?
Thanks for your time!
Sandy