Thoughts on this 126 pad park?

mobile home university
1

I’m a regular lurker on this forum but first time poster. I’m intrigued by the MHP investment for all of the reasons that are continually discussed here. I’m looking at the following MHP and was curious what the general consensus was here:

126 single wide Pads on 8 acres

99 lots have homes (older homes around 1955)

84 occupied at $320/m lot rent

27 lots vacant

12 park owned homes

Public water

Public sewer

Older park Located 15 minutes from medium size city in upstate new york.

Gross Income $322,560

Net Income $158,757

Asking Price $1,500,000 Asking CAP: 10.58%

Other details: separate water meters are needed. Also, the park owner is responsible for the administration of the NY STAR tax refund to the residents (need more info about this)

From what I’ve read this seems like it hits alot of the good points - public water and sewer, few park owned homes, near a medium size city, etc, and the asking price does not seem outrageous. Maybe offer around $1.2mm?

Thoughts?

2

That sounds like a reasonable deal to me. Purchase Frank & Dave’s books on MHP due diligence and valuation if you’ve not done so already.

Quick and dirty valuation:

84x$320x60=$1.6mm

  • the value of the 12 POHs

=$1.6mm+

I’d install meters and bill for water, rehab the existing POHs as needed, and start infilling the vacant pads with newer used MHs.

Best,

-jl-