We are taking over a new park and don’t have our acquisition checklist dialed in like I want. Was hoping to get some input.
We have the basics…
Welcome Letter
Changing Utilities
Delivering New Park Rules and Regulations
Rent Payment Info
etc.
But was hoping someone had something a little more dialed in that I could add to.
Examples being , add new 10mph speed signs with vinyl surrounds “with these measurements”, add sign to front of park with “these measurements and this font” , paint speed bumps “this color yellow” , Add community specific signs, etc. things you do in every park to make them uniformed once taking over.
You’re off to a good start. The transition is always difficult, namely because the last owner/manager wasn’t you and likely did things just a bit differently.
Utilities is important. I also like that you have the Park Rules going out.
Something else to consider, maybe sending out critical information on multiple occasions, in multiple formats. For instance, the Rent payment info = you send letters to all tenants, but also maybe post something to doors, or a phone call. The goal is to get it right, and quickly! So, over-communicating is likely helpful.
Who’s going to pay you, who’s staying, who’s leaving, and who’s needing eviction.
Im not certain on how much you’re working with capital wise to start with, or what your goals are, or if you are raising rents, or what the demographic is in your park, how much debt you have on the park, what your cashflow looks like, etc…
Before spending money on capital improvements, make sure you set a “cool off” period (1-3 months) to understand who and what you’re dealing with to understand the most important aspect - your income. All of your energy needs to go into getting tenants signing new leases, knowing how to pay, the rules / regs, and so on…
Understand this first before spending any money at all, then start with capital improvements after you feel confident on your income. Just my two cents from experience so you don’t find yourself in a cash flow crunch / cash burn position. If you have cash to burn or don’t really care - then go for it.
Also make sure you have a contingency line item…for example 20K cash for unknowns. Unknowns will happen - water leaks, 15 tenants move out, tree falls down, etc…
We have a 79 point checklist from pre-contract to post closing integration. The last 9 items on the checklist, which begins on the day of settlement include the following:
Sign management agreement
Send transition letter to tenants informing them of new owners
Requested final tenant ledgers and update prorations for rent, deposits, taxes, prepaid expenses, etc.
Obtain mobile home park operators license
Import tenant accounts and open tenant ledgers
Issue credit to waive charges for tenants who have paid in advance
Enter charges for security deposits and credits for deposits transferred at settlement
Enter charges for tenants who are past due to prior owner
Enter the starting balance sheet of the property.
I’m happy to send the full list to anybody who responds to this survey currently running on the mPark Partners LinkedIn page:
What is your favorite value creation lever for investing in manufactured housing communities?