Advice on Small Park in Midwest

Looking at an off market park in the midwest w/ the following details:

  • Town has population of 6k, 20 miles to a city just under 90k
  • Median home price in zip code is $160K, in metro is $140K
  • Metro vacancy is 10%, town vacancy is 6%
  • Metro unemployment at 4%, town also at 4%
  • Avg. 2br rent in town is ~$700K; avg 3br ~$1k
  • Called a few parks closer to the primary metro. Lowest lot rent I could find is $285, and that park is expanding.
  • Metro population up 8% since 2010, town’s population up 10% since 2010,
  • No Walmart in the town itself - nearest Walmart is 20 miles away in the center of the metro
  • Mom and pop park, they’ve owned it for 25 years, no website
  • 17 total lots, 13 TOHs, lots rented at $240/month
  • All TOHs, no POHs
  • Public utilities
  • Tenants billed directly for water
  • Park generally well kept, skirted homes, no junking lying around
  • Park is right next to a train - not sure how often train passes by. On google maps there’s another park in town also next to a train, and it looks to be around 80% occupied
  • Access to the park is on land that is owned by railroad. Owner can’t get an easement, but is organizing a 30 year lease from the railroad, cost TBD
  • Not yet under contract, haven’t done test ads
  • Seller asking for $309K, but we all know 13 x 240 x 12 x 0.6 x 10 = $225K. Some room to raise rents.
  • First park, and I’d need to manage this park from out of state, probably with a friend who lives in state. Seller only open to financing up to 40% w/ 5 year amortization, not sure of interest rate.
  • Seller doesn’t have tax returns from 2018 (generally disorganized and in poor health). He does have returns from 2017.

Thoughts or advice? Not trying to hit a home run here. Goal is to just get moving on my first park and get some momentum.

Personally that would be too small a park for me to buy and manage from out of state. But if you are comfortable with that, then that’s fine. You really need to know everything you can about that small town and the larger metro. Some of those midwest rural towns are vibrant and growing - others the complete opposite. Also, it will likely take more time to find a buyer once you exit the deal just because it is on the small side. Good luck!

This park will be too small to generate much profit relative to the time required, but it could still be worthwhile as a way to learn about the industry while still making a few bucks.

A few thoughts:
-The seller doesn’t seem to be reasonable on his pricing and terms
-The seller likely needs to sell, and you’re probably the only one serious about buying it.
-I would ask for a much lower price, and if needed require fully amortizing seller financing with ~30% down. I would delve into his financials and see if that gives any leverage. I would also say a discount is just the reality given that it’s a smaller park and he doesn’t have 2018 records in order.
-If he balks at lowering the price, I’d walk away on hopefully good terms and offer to check in on things in a few months.