Want to buy my first mobile home park
We own a hefty amount of retail/office around the nation and we've recently peaked interest in mobile home parks due to cap rates being so high. 

What are the pros and cons of mobile home parks? 

How do you under write mobile home parks?

What are things we should look out for?

How would you value the fire sale price is everything were to go wrong?

What cap rates do mobile home parks typically trade at in the southeast/midwest?
[{"id": "ffah61p", "text": "What I have been told is you want to buy the land and not the homes. Small tidbit.", "replies": [{"id": "ffai9fa", "text": "Buy the land, provide loans or find a lender to partner with on the loans for the homes.", "replies": [{"id": "ffalyx1", "text": "That's what I've read: buy it, self-finance the homes to the tenant so you're just leasing the land, keep or package and sell the note on the homes.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ffaisex", "text": "I financed a (I think)150 unit mobile home park deal.  I remember half were MHs, the rest were traditional multi-units.\n\nFrom memory: \n\nPros: Cash, sometimes not shitty tenants, laundry and vending machine income, leasing the ground, making a deal with a manufactured housing maker to put them in and you get rent (i'm doing this from memory)\ncons: cash, sometimes shootouts depending on how shitty it is, turnover, needs constant on-site PM, things can very quickly spiral out of control over the course of 3 months, need to collect payments in person.  \n\nDid the deal 10 years ago, so kinda foggy.  $3.7MM in a rural area.\n\n&gt;How do you under write mobile home parks?  \n\nRent rolls and P&amp;L and a police activity report from the cops.  You're going to need 20-30% down, and I go the seller to hold a note, so the borrower ended up bringing like 10 or 15%", "replies": [], "depth": 1}, {"id": "ffb5jxi", "text": "Own a few. Parks that are 50+ units trade much better than those that are smaller, that is when you want to sell. My opinion is that anything under 30 units is not worth it.\n\nYou want to have lot rents only, when you own the park owned homes (POHs) you have a very high expense ratio although income is much higher. Our model is get those that are POHs and convert to rent to own and eventually lot rent only. When it\u2019s lit rent only the residents are less likely to leave, then you raise lot rents and provide a good park for you residents.", "replies": [], "depth": 1}, {"id": "ffbeetv", "text": "One of my buddies works with one of the top mobile home brokers in the nation and they have a lot of off market deals. Happy to make an introduction if you wanna PM me", "replies": [], "depth": 1}, {"id": "ffbz9yw", "text": "Im a MH park broker. One of the top in the Southwest. Cap rates are not high here at all. One listing we sold recently at below a 3 cap in AZ. They are a shrinking property type and huge sellers market (little to no development). PM me I\u2019ll add you to our distribution list but don\u2019t expect much as most stuff is offmarket and there will be a lot of competition from other buyers depending on where you are buying.\n\nThere are generally 2 types of parks. The senior 4 &amp; 5 star parks which are high quality, low cap rates, sometimes even on golf courses, etc (they are quite nice)... and the Family parks which tend to be 1-3 stars (I\u2019ve seen some rare higher quality family parks but most aren\u2019t. These are where the stigma comes from but still quite profitable.  There is stiff competition in both, more so in the senior parks", "replies": [], "depth": 1}, {"id": "ffd4uai", "text": " **interest in mobile home parks due to cap rates being so high.**\n\nYou are making a mistake of buying cheap.  There is a reason mobile home parks are cheap.  They are not very profitable.  At a 10% cap you will only increase your value by $10 for each increase of NOI by $1.  That same $1 increase in NOI will get you double in a 5% cap rate asset/market.  Work smart, not hard.", "replies": [], "depth": 1}]