The Mobile Home Park Investing Podcast - Real Estate Investing Niche

Today's episode of The Mobile Home Park Investing Podcast delves into the all-important topic of due diligence. Host Kevin Bupp is joined by Jethro van Aardt, the Director of Operations at Sunrise Capital Investors, and they break down the many moving parts and processes of due diligence--from kick off to title transfer.

Due diligence is one of the most critical aspects to master when diving into the niche of mobile home park investing. It has its own unique set of nuances and to be aware of, as well as opportunities and usual skeletons in the closet to watch out for.

Quotes:

"Due diligence process, it's a pretty thorough process and a lot of sellers often get intimidated by it. They're worried that you're going to uncover something and it's going to completely throw the deal out so they get kind of secretive, which is pretty strange. It's counter-intuitive."

"The offsite phase is critical. We need to know that we have the exact information. For example, simple things like the exact address of the property, the exact pad count, how many homes are abandoned, how many homes are resident-owned, how many homes are rented by tenants, etc etc. So it's verifying a lot of information."

"DD is really just a long checklist and it's following that checklist and obviously you start off with the most critical things and, if you can get through those critical things from the top to the bottom, then you reassess and understand do you move forward or not."

"Sometimes these places look really nice from the outside. When you get inside, they're in really bad shape. You need to understand the quality of the resident base. If anybody is prepared to live on the floors, you know that person's not paying the rent and they're probably going to skip the town in the middle of the night."

"Unfortunately that's one of the painful things sometimes is that you can do all that prep work and offsite, think that you've covered everything but there's still going to be skeletons and that's why the onsite is so crucial."

Discussed in this Episode:

• 09:25 Kickoff call process and offsite due diligence
• 19:55 Onsite due diligence and prelim investment committee phase
• 38:13 Closing and pre-take on
• 43:32 Software used by Sunrise Capital Investors
• 46:54 Usual skeletons in the closet

RESOURCES:

• View Career Opportunities at Sunrise Capital by visiting Careers.SunriseCapitalInvestors.com
• Check out our company and our partnership opportunities by visiting SunriseCapitalInvestors.com
• Would you like to partner with us on future MHP deals, call 844-CASH-FLW to learn more or click here to schedule a time on our calendar.
• Grab a free copy of our book “The 21 Biggest Mistakes Investors Make When Purchasing their First Mobile Home Park...and how to avoid them Click Here to Grab a copy
• Get our Free MHP Due Diligence training Video DD.SunriseCapitalInvestors.com

Snickfish is a Title Management company focused in Mobile Home Real Estate, Mechanic, and Storage Facility Markets.

If you’ve spent any time around the mobile home park niche then you’ve surely familiar with abandoned mobile homes and the challenges that are sometimes associated with them. And if you currently own a mobile home park, then you might even have a few abandoned mobile homes in your park now and have no clue how to handle them. Case in point, if you intend to enter into this niche, then you will need to get familiar with the abandoned title process of the state in which your park resides.

Residents abandon mobile homes for a variety of reasons: eviction, loss of job and can’t afford to move, death, skipping town, mobile home is dilapidated and they can’t afford to fix it, and the list goes on and on.

The goal is to obtain the legal ownership of that home so that you can either renovate it and resell or legally remove it from your property. And that is sometimes easier said than done. It’s challenging to stay current with State laws and regulatory mandates governing abandoned property. Mobile Home Park owners and Property Management companies are constantly battling the State, local courts, and the DMV bureaucracy. What works today might not work tomorrow.

Snickfish just might be the service that will help you solve your abandoned home challenges.

Click Here to Gain Access to the Newly Revamped Deal Finders Formula

Recommended Resources:

• Check out our company and our partnership opportunities by visiting SunriseCapitalInvestors.com
• Would you like to partner with us on future MHP deals, call 844-CASH-FLW to learn more or click here to schedule a time on our calendar.
• Get our Free MHP Due Diligence training Video DD.SunriseCapitalInvestors.com
• Grab a free copy of our book “The 21 Biggest Mistakes Investors Make When Purchasing their First Mobile Home Park...and how to avoid them MobileHomeParkAcademy.com

In todays show, Charles and I are going to be doing a little something different based on direct feedback from numerous listeners who suggested that it would be helpful if we, Charles and I, did a show that specifically went through deals that we are working on and/or have under contract so you can view it from our eyes.

As you know, we typically do case studies on parks that we’ve recently acquired but I can see the many benefits that one might receive by having us go through a park that we’ve recently tied up but haven’t yet closed on yet. And so we’re going to walk you through all the particulars of a deal that we recently tied up in Charleston, WV so that you can better understand our deal selection process.

And as a side note, Charles and I are also looking for potential partners on this deal. so if this sounds like something you might be interested in, we’d love to discuss the possibility of partnering with you. Send us an email to [email protected] for more information.

Park Characteristics:

• 135 total spaces
• 128 occupied – All TOH
• Average lot rent: $160 (market rents are $225)
• Water/Sewer: City direct billed
• Wide Concrete Streets
• Great school district (If you are a buy and hold long term investor like us... then this is important)
• Purchase price $1.8 million
• Built in 1980’s

Recommended Resources:

• Click Here to Grab a free copy of my latest book “The 21 Biggest Mistakes Investors Make When Purchasing their First Mobile Home Park...and how to avoid them

In this episode of The Mobile Home Park Investing Podcast, Kevin Bupp speaks with manufactured housing finance expert Jerry Muir. He is Managing Director at Greystone working with the Agency Lending Team with a primary focus on building out and expanding their manufactured housing lending platform.

Jerry is a 25 year veteran of Fannie Mae and, during his time as Director of Multifamily Credit underwriting Fannie Mae, was responsible for a 12-state southeast region.

He had dual roles in developing and managing the manufactured housing community lending platform. Impressively, he has overseen north of 10 billion in financing.

Quotes:

"You might not have the prettiest homes in there but if it's a well-run community, it's stable, it's going to do well."

"Our manufactured housing community, because you've got so much stability because it costs so much for a resident to take his home and move it to another park (I mean it could be in excess of $7000), they're not just going to move down the road like in the multifamily property."

"If you've got a tier 2 loan on the property and you want to do a supplemental, you would get tier 2 pricing on the supplemental, basically."

"Their regulator, the FHFA, basically restricts the amount of business the two agencies can do and they call it cap or uncapped business. An uncapped business is they can do as many loans as they want in that space."

"They really open to more people and make it more affordable for them to get into a home and get into a park, no question about it. "

Discussed in this Episode:

• Developing MHC at Fannie Mae
• Differences of Fannie Mae and Freddie Mac
• Supplemental Loan Program explained
• Future outlook of Fannie Mae
• Detailed overview of Greystone in the MHC space

RESOURCES:

• View Career Opportunities at Sunrise Capital by visiting Careers.SunriseCapitalInvestors.com
• Check out our company and our partnership opportunities by visiting SunriseCapitalInvestors.com
• Would you like to partner with us on future MHP deals, call 844-CASH-FLW to learn more or click here to schedule a time on our calendar.
• Grab a free copy of our book “The 21 Biggest Mistakes Investors Make When Purchasing their First Mobile Home Park...and how to avoid them Click Here to Grab a copy
• Get our Free MHP Due Diligence training Video DD.SunriseCapitalInvestors.com
• https://www.greyco.com/

Today's podcast features Jethro Van Aardt, Director of Operations at Sunrise Capital Investors. He has an extensive background in commercial real estate and asset management.

Jethro talks on how he’s implemented processes which produced multiple benefits to consolidation planning, better organization, cost savings, and higher quality of coverage, while also spearheading their insurance project. Quotes

"That's what it boils down to. That's why you want to choose your broker first. You also want to be sure that you've got the right person servicing you."

"Like everything in life, you get brokers that are small, they don't have access to products that the big corporates would have."

“But generally, I'd say about between 800 and a thousand pads is when you really could start seeing some great pricing efficiencies and really the brokers would start getting excited. Anything smaller than that, you know, it's going to be difficult to get the brokers excited because it takes a lot of work on their side too."

"Guys would never do this product if they felt that their clients were at risk or the entire industry was at risk."

"Insurance is a complex product. When you are going out there and you're comparing your different products, just make sure you're comparing apples to apples."

Discussed in this Episode:

• Jethro discusses his personal and professional journey leading up to Sunrise
• Details on his insurance project
• Brokers and the "Decision Matrix Tool"
• Working with IMA Corp of Jed Bond

RESOURCES:

• View Career Opportunities at Sunrise Capital by visiting Careers.SunriseCapitalInvestors.com
• Check out our company and our partnership opportunities by visiting SunriseCapitalInvestors.com
• Would you like to partner with us on future MHP deals, call 844-CASH-FLW to learn more or click here to schedule a time on our calendar.
• Grab a free copy of our book “The 21 Biggest Mistakes Investors Make When Purchasing their First Mobile Home Park...and how to avoid them Click Here to Grab a copy
• Get our Free MHP Due Diligence training Video DD.SunriseCapitalInvestors.com