After months of reaching out to Brokers looking for MHPs in Arizona, I finally put together my own database of 130 parks and sent out letters of interest and inquiry to owners. Of the 5 responses, I have received to date, the most interesting is a Trailer and RV park in Central Arizona. It is a great location, potentially attractive upside, City Services, Sub Metered, surrounded by all of the great big box stores and centered in a clean blue-collar neighborhood. Most of the units have been there for quite some time and it seems a semi-permanent arrangement for the tenants.
I have listened to many many hours of Podcasts (including “Mobile Home Park Mastery”) and read many articles over the last year. I have analyzed a lot of properties too (I have gotten pretty good at it).
It seems that, after all of the research, listening and reading I have done the consensus is that, the smaller spaces in a Trailer/RV park cannot support or is not marketable to a prospective tenant with a small family. I started looking at Park Model Homes (under 400 Sqft). There were some two bedroom models but they were few and new units ran about $30K to $40K.
My question is, “is it wishful thinking to think that a park as I have described above could be turned around into something, cleaner, more respectable and family oriented and is the concept a recognized business model within the investor community for this asset class”?
You might be able to find a single parent with kids that would fit a home this size, but you have two competing priorities: 1) small lots for small homes; and 2) a desire for a family park which by design requires larger homes.
But you can still run a clean respectable park - but you will be targeting snow birds or retirees instead of families. While some people are turned off investing in parks with smaller homes, ultimately the cash flow tells the story of the market and how you run the business.
How many mobile home spaces and how many RV spaces? If you are talking about just a few RV spaces and the price is right, then no problem. If all spaces are small, then that’s a challenge, unless you can make one mobile home space out of two RV spaces and the numbers are still good.
Thanks for the feedback. Yes, the owner had passed my letter along to his broker. In talking with him I determined that the tenants are pretty much in their long term which flies in the face of what one would consider normal for a trailer/RV park.
There appear to be at least 25 spaces and one stick built home (Tax records say 31 spaces of which 20 are RV and one Stick frame structure). There are also two other structures which appear to be storage and an old coin op laundry room. The park is roughly 1.5 acres. There are some larger spaces for bigger homes but most of the spaces would accommodate a 14 X 33 home with the pad to one side of the home.
RVs can be moved very easily… even IF they live in them full-time. One other thing to consider is the fact that RV lots will not have the same electric hook-ups as a MH lot so IF you do want to put a MH on there at any time … you might be replacing an electric stand and you’ll need permits etc. … will the city or county allow that?
Given that there are only 5 MH spaces and 20 RV spaces I would pass on this one. If the numbers were reversed I would consider it. As mentioned before, RVers can pick up and leave at any moment.
RV parks and MHC are NOT the same animal. They are wired differently for electric hook-ups AND they are usually managed differently. RV parks are a lot more labor and hands-on management than a MHC. I have managed both business models and I found I make more money with less effort and expense with a MHC.
OK, I think there is enough consensus that there is an opportunity for snow bird/retiree community but not a site for a families, necessarily. The affixed residential structure might be converted into a Day-room/Clubhouse. Perimeter fencing, clean up, and rule establishment and enforcement are in order here. I am not in to the “nightly, weekly , monthly stay model” so I would opt for a background check and lease agreement.
I really want to thank all of the comments that helped confirm what I had thought. There is a difference between a calculated risk and wishful thinking.
I specialize in MHPs & RV Parks in Arizona. Park Model RV Parks as you described typically have seasonal or long term tenants vs a transient RV Park and have better financing as well (Yes Park Model RV Parks are quite similar to mobile home parks). It might not be for you but feel free to contact me if you are still looking to purchase: andrew.warner@naihorizon.com.