Hey Gang, I am new to this site. I am posting here out of desperation. Hopefully you can provide some soundly advice. I purchased a mobile home park approximately 8yrs ago. I really had no idea what I was getting myself into as I was new to mobile home parks and investment properties in general. The park is only 20 units and has very aged mechanicals. When I got my hands on the park it was very run down and the manager was using it as a place to perform scrapping. It was a mess.I replaced the manager, replaced 5-6 trailers(replaced 1950-60 trailers with 1970-80 trailers)…doing everything I can think of to put my best foot forward with the property.I’ve had a revolving door of managers for all sorts of reasons…marital issues, terminal illness, neglecting tenant requests, lying about expenses, etc. The number one issue I’ve had over the years with this old park are water lines breaking underground, going undetected and/or unreported. The local community has high water and wastewater rates so in times of water leaks it’s not unusual for me to get a $6,000-7,000 quarterly bill. The community will not offer a break on the bill as they state I am a business and I am responsible for all usage by the business.Last fall I had a tenant who accidentally started a fire in their trailer by leaving a candle unattended. In the process of putting out the fire the trailer shifted snapping the water lateral 6’ under ground. Went through the normal process excavating, repair, etc.After 8yrs of “pain and suffering” I gave up on my park. I put it up for sale. I came to the conclusion I would never find a quality manager and in turn never have a base of quality tenants who stay in the park for more than 6-12months. Two months ago I came across the perfect, in my mind, manager for the park. We’ve booted the rift raft and are making upgrades to trailers as fast as possible. Unfortunately we still have 4 outdated, run down, vacant trailers left. I’ve run my available funds very low in remodeling three trailers in the last two months. The park is too small to bring in modern trailers so remodeling these old trailers seems to be one of our few paths forward.My biggest priority for the park is getting the water and sewer lines replaced. Being an older park it was designed to have the park manager be responsible for water and sewer lines to central location in the park property. The sewer lines are made of orangeburg and the water lines have rusted and quite brittle. My primary lender doesn’t want to invest anymore money into the park. They’ve helped buy the park and replace mobile homes but I just haven’t been able to turn a profit and run it in the black. With the new manager in place I am thoroughly convinced we can finally make the park work. I think I can come up with enough funds to repair the four vacant trailers in my park to make them more attractive to a higher quality tenant however i don’t have the funds to do both the trailer remodels and the mechanical upgrades.Does anyone have any experience taking on these projects with tight funds? Microloans? Angel investors? Equity partners? Any chance there’s grants available? I am open to anything.Sorry for the long post. I wanted to paint a complete picture of where I am at. If I am not able to identify a source of funds I might have to go back to trying to sell the park which is the last thing I want to do.Thank you kindly in advance for any suggestions. Big Luke.
I am more than willing to put together a business plan, pictures, discuss over the phone, etc. We are currently working on getting three bids from local plumbers so that we have an idea of what ballpark costs are going to be.
BigLuke -Ouch. Sounds like you should have gone to Bootcamp prior to purchasing this park. There isn’t an easy answer for someone in your situation, but if I were you, I would:1. Make sure the master water meter has a leak alert on it. This is usually a graphic image that appears on the meter’s digital screen that looks like a faucet dripping. Basically the meter is smart enough to know when water is being used constantly, which indicates a leak. Your municipal water provider should install a meter that has this feature. City/rural water companies are usually obligated to replace meters more than 10 years old and/or meters with more than 10 million gallons on them (regulations vary by water company). But be sure you’ve got a ‘new-fangled’ master meter at your park that your manager (or you) can go check daily to see if it’s detected a leak. Finding out you have a leak from your quarterly water bill 90 days after the fact is obviously too late.2. Sell off as many of your mobile homes as you can. Don’t rent them. Sell them on terms. This will generate cash you can use to…3. …replace the water lines. You might call American Leak Detection to come find leaks; it’ll cost around $750 and is money very well spent if you can get away with ‘spot replacement’ of water pipe. But it sounds like you have leaks ‘everywhere,’ and the only path forward may be complete replacement. (Of course, use Schedule 40 PVC).4. Sewer pipe may need to be ‘spot’ or ‘entirely’ replaced too. Orangeburg is a disaster.5. Ask your local MHA for their thoughts on grants, etc. And if you find such, please post back here on the Forum!Good luck,-jl-