I looked at a small mhc in Alvarado which is about 1 hour south of Fort Worth. I think it was called “Creekview” and that should have been a big red flag. I asked the seller about being in a flood zone and he assured me only a “tiny” part of it was and that unusable for homes. The place has some empty lots and he assured me the residents are long-term and wonderful people. The seller sends me what I later find out to be some pics with absolutely fantastic camera angles and things look OK. The numbers look good so off I go.
FYI: A park on LoopNet with no pics is a bad thing.
I drive up to this piece of dog meat and the first thing I notice it is next to and downslope of an old gas station. Hmmm, I think, given the lax environmental laws in TX, the Phase 1 people should have lots of fun. Then I see the homes are old and decrepid and not placed in any type of orderly layout. It is like a tornado picked them up and wherever they landed that became their address. Several of the homes are vacant (the park-owned ones as it turns out) and the others are just plain ugly. Dogs (emaciated and vicious) on long ropes everywhere just waiting for the opportunity to make a meal out of your lower leg. Then there is the babbling brook that runs right along the back of a number of homes. Not good. I called the seller in the morning and, lo and behold, now he tells me about 1/3 of the park is in a flood zone. No way in hell will I buy anything in any kind of flood zone. Oh, and did I mention the town itself? I have seen figures in a wax musuem with more life than this place.
Not having much to do the next day before my flight back, I drive down to Temple to check out another place. Older park but really lovely. BIG mature trees and in a great town and a location on top of hill to die for. In walking around, I notice water line repairs being done. Hmmmm, 1" schedule 40 pipe running just inches under the road with no sleeves. 26 units and they are using 1" pipe!!! Must be great in the morning when everyone is taking a shower. No problemo as I am a landscape contractor and it’s pretty easy to do a water system.
Things start to go south when I open a panel box to check amperage. An entire nest of the most unusual and largest wasps (killer bees???) flies out and attacks me. I probably set a new Olympic record for the 100 yard dash.
Nonetheless, I decide to pursue this place as I really like the area. To make a really long story short, it turns out the person who built this place installed a clay sewer line across 2 adjacent parcels to the closest manhole. Problem is he neglected to record an easement for access. Things are a little murky but it seems the owners of those parcels do not like the owner of the park. The city never even had platted the park so they made the new owner do it. As nonconforming as possible so,in exchange for being nice enough to allow the use. the owner had to give the city $38K so the city could fix its crumbling manhole/sewer connection. Great, I think, I can upgrade the sewer system at a reasonable cost. Wrong. Turns out the adjacent property owners will not give the owner an easement for access to his sewer line even though their properties are open fields. They cannot make him tear out his 50 year old clay sewer but they do not have to allow him to cross his land if it ever needs to be fixed and clay sewer pipes have an extremely limited life. Plus you cannot usually line them with a PE liner as the size is usually too small for modern codes. At this point, my offer is to either get a sewer manhole in front of the park or buy the adjacent lots or forget the whole thing.
All of the above I found out long distance on my own.
I hope you get a sense of just how badly you can get burned in this business. I owned a park in AZ a couple of years ago and had to give it back to the sellers. Turned out there was some outright fraud and non-disclosure and the place was close to be unihabitable. Infrastructure again. Contact me if you want some real horror stories. In my mind, infrastruture is key to the long-term success of a park and you must assume everyone is lying to you when they tell you they never have any problems. I still want to eventually own 2-3 parks and I believe in the business but caveat emptor should be permanently etched into your brain.
After a year of looking, I think I am onto something I really like. Horribly managed and failing but great infrastructure (200 amp pedestals, good roads, plastic sewer and water, city utilities) and layout. Lots of possibilities if managed correctly. Just sent in a letter of intent tonight. The sellers have 2 more parks in the area they royally screwed up and are desparate to sell them by the end of the year. Give me a yell and maybe one of the them can work for you.
Post Edited (09-27-06 18:05)