This Mobile Home Park is permitted by the city for 100 spaces. 57 are currently developed. There are currently 46 park owned homes of which 37 are online (the owner just moved in a few that they are working on installing), and there is one leased space.
Gross income with the 46 online is $33,665 per month with the net income being $25,863. Once developed out to all 100 gross income will be around $75,000 per month or $900,000 per year (NET cash flow would be about $600,000 annually).
Homes rent for n average of $755+ for three bedrooms. All are three bedroom/two bath except for 4-5 two bedrooms in the community. This is a Modern Park that was built in 2001 with all new infrastructures: water and sewer lines, electrical underground, asphalt road, concrete parking at each lot, etc. Each lot has its own individual water meter.
Currently the park is undergoing a big project right now consisting of bringing the new homes online, repave work to the road, fix some skirting and decks on the existing homes (which is deferred maintenance from the previous owner), etc.
The estimated expense would be $1.25M additional to fully develop out the park to 100 park owned homes, or $125,000 or so to develop the remaining 43 lots if you wanted to rent out the lots. So, for 3,700,000 total investment, including the initial purchase, the property would generate $900,000 per year gross ($600,000 NET cash flow).
The owner has offered to manage the park for one year at no cost to a buyer and after the first year can revert to a predetermined fee that works for both parties.
If you run the "Income Approach Appraisal Method" with all 46 online, it shows an appraised value at a 10% cap rate of $2,936,760. If you are interested or have additional questions email me directly.
Brian R. Baker, MBA
Texas Housing Partners LLC
brian@texashousingpartners.com
