I am looking at a park to buy in Pennsylvania. It was built in the 1960s in a town that seems to be economically stable and growing due to the increasing industry in the town (powerplants being built and the natural gas & fracking companies, etc.). There are a couple other parks in the area that appear to be doing quite well.
Details about the park’s history are hard to come by since the current owners inherited the park and have not kept many records. I have a P&L from last year which shows a 23% expense ratio. There are 23 lots and 19 of those are occupied (lot rent only, no POH’s). The park is on city water & sewer and all utilities are direct billed except for garbage pick up which the park pays. The lot rent is $150 currently but should be closer to $185.
Many of my due diligence questions have been answered but the big thing for me is that there are no P&Ls or rent rolls from previous years. This is a real mom and pop park and is not owned by an LLC which eliminates separate tax returns for income verification.
My visit to the park confirmed that there are many people living there and the park itself is in good condition (older trailers probably from the 70’s). The asking price for the 10 acre park is $370,000. The upside is that rent can quickly be raised and the 4 vacant lots should be relatively easy to fill if I brought in trailers to sell.
How does this deal sound to you guys? I’m not exactly sure how to proceed since there aren’t any of the typical financial documents available.
Thanks for the help,