Buy MHP land only, MH owned by third party management

Working on a deal where I buy only the land the long established park sits on. MH owned and leased by third party management company. I collect rent from management co and maintain common areas. On well water and municipal sewer.

Is this a bad idea for 1st time MHP investor?

That is literally the idea I was thinking of earlier today for one of our parks - let a third party firm manage the park owned homes and even deal with the home owners who just lease the lots. The park then will simply maintain infrastructure. How this could be so difficult - the way frank and others claim it is - I dont’ understand. Third party property management works in multifamily and it works in the SFR market - why it couldn’t work managing rental park owned homes is beyond me. I think it can.

Yes, this idea can work.

The only drawback I see is the heavy expense load. A third-party management firm is going to charge you a percentage of the income to manage the property. You can hire one to manage just the park, just the POH inventory, and/or both.

The reason it’s not super desirable is it’s cheaper to hire your own on-site staff to do the same job.

Many management firms also have a monthly minimum charge. IE $2500/month or 10% of the Gross whichever is higher.