I am aggressively pursuing purchasing my first park. In my search criteria I have been listing towns with at least 60,000 population count, with an upswing in the last census.
Can anyone comment on this? I’ve seen some attractive parks in smaller towns (down to about 10,000). Am I being naive by only looking at the bigger towns or cities?
Thanks for your input.
I have no problems with smaller towns. Of course, I grew up in one.
What you have to keep in mind about rural towns is that the town itself might not be that big, but is the town stable and is there a stable and growing “economic center” nearby? Many small towns are just bedroom communities. People live in the town and drive to the next, larger town for work. I would still focus very well on the stability of the town. It’s not shrinking, is it? As long as it’s staying stable, and there are jobs nearby, I’d be comfortable with it.
Other times, the small town is the one with the jobs but still doesn’t show a lot of growth. Why? B/c it’s cheaper for everyone to live outside of town in the next small town where housing in $x cheaper. Or maybe everyone in town wants a “place in the country” so they move out of town, but build a $200,000 house on 5 acres 3 miles outside the city limits. That’s not going to show up on the census. In that case, you’re going to have to look at the stability of the larger area - probably the county.
My partner and I looked at a 100-space park in a rural county in the middle of KS. The town wasn’t large, but it was stable. It had several businesses along main street, including an O’Reilly’s Auto Parts and a couple fast-food places. The town hadn’t shown any growth for a while but I had no qualms about it as far as the demographics. Ultimately we didn’t purchase the park b/c we were too far apart on price and he wasn’t willing to come down that last $100k.
Bear in mind, I haven’t owned a park . . . but I’ve grown up and lived in rural areas my whole life.
Michael(KCMO)
Rick,
Ditto what Michael says. One other aspect you’ll want to consider if you try use conventional financing is the requirements that the lender has. They are all different, but one fairly common thing we heard was that they want to see at least 25,000 people within the MSA. Several looked at an area within a 30 miles radius; others were plus or minus that.
In my case, the park is in a town of only 2,000 people, but it a bedroom community smack between 2 growing cities, each only 8 miles away, so they were ok with it.
Cheers and best of luck!
Howard