KS

My wife and I are mobile home park investors, currently living in Appleton Wisconsin along with 3 children ages 4,7, and 10 . We are looking for investors and funding for properties initially in the midwest,  Indiana,  Wisconsin, Minnesota,  Ohio, Kansas, Iowa, Oklahoma, Kentucky, Tennessee, but  are open to other areas of the country if the property and the deal is viable.

The team consists of myself,  I was a real estate agent a few years ago selling homes,  and my wife, who has a very extensive management background and is currently an administrator for Safe Step, a precision concrete cutting company and also she holds a Master degree in business management and  Andy Tallone who is a consultant and  Vice President of CCI Investments, CCI both sells and also assists owners and managers of mobile home parks with the day to day operations side of running a successful mobile home park.

One of the major problems today is affordable housing, its a giant topic in America, 20% of people who live in the U.S earn $20,000 per year or less and 10,000 baby boomers retire everyday into social security checks that average only $14,400 per year. Mobile home parks offer higher greater returns and stability than any other real estate sector. Its the only real estate segment that grows stronger as the economy weakens. That’s because they are based on the demand for cheap housing, which grows in stature as the economy declines. Experts already estimate that 50% of Americans can’t currently afford their housing, which means that affordable housing is a hugely in-demand commodity.

 Mobile home parks have the highest yields in commercial real estate, with starting cap rates often over 10%, and cash-on-cash returns of 20% standard fare. This is at a time in which apartment cap rates are often around 7% and retail cap rates are sometimes at 6% or lower. Because there are fewer buyers for mobile home parks than other real estate niches, the supply/demand formula has always given mobile home parks a higher going-in rate of return.
 
 If you believe that the U.S. economy will continue to decline in the years ahead, under the weight of social programs and the drag of an aging population, then mobile home parks are virtually the only form of real estate that performs better in a recession. As America gets poorer, mobile home parks are the only form of housing devoted to this demographic.
 
The American Housing market issue coupled with the very large and growing number of people who earn $20,000 per year or less, can be solved by offering safe and affordable housing.

The business model we believe in, is  safe and affordable housing through mobile home park investing. We also make money by considering other aspects of the business  that most other investors turn from and consider to be negatives.
 For instance park owned homes, small towns, well and septic. We include park owned homes  as part of our business model. Most investors turn away from park owned homes because they don t want to deal with the maintenance issues. But I can quickly dispelled that, in this example.

Lets say you have a 100 space park that costs $500 per month, per home          100 spaces times $500 is $50,000 per month      $600,000 annually

But the very same example from the point of view of most mobile home park investors looks very different, they would sell the homes to the tenants
which would drop their monthly income from $500 per month, per home  to $200 per month per home because they are paying just the  lot rent.
100 spaces times $200 per month per home is $20,000 per month, so instead of getting $50,000 per month they are now getting $20,000.
The cost to own and maintain a 100 space park which includes maintenance and repairs on the homes, insurance and tags is about $8000 per month. So they are giving up $30,000 to save $8000 and leaving $22,000 on the table every month. $22,000 times 12 months is $264,000 annually. 
This $264,000 extra, is income that most other investors turn away from. We include park owned homes because it greatly increases monthly cash flow.

The mobile home park market has much less competition than other areas of real estate. The typical mobile home park customer is choosing between an apartment vs a mobile home. so the major competition in any market will always be low priced apartments and single family homes that cost less than $100,000. Even if the single family  homes are cheap, the  major competitor to mobile homes is apartments.

Now that many Americans are working from home they need more space. But they also don’t want to be living up against their neighbors. Mobile home parks have always offered no neighbors knocking on walls and ceilings, a yard, parking by your front door, and all the bells and whistles that subdivisions offer yet apartments can’t touch.

But also important is the pricing of that conventional competitor: the single-family stick-built home. Not only are the prices of these homes exploding but lumber prices are way up due to the pandemic and that means that newly-built homes will be even higher. By contrast, mobile homes sell for a fraction of these costs, with a new mobile home set up in a park ranging from $30,000 to $50,000 while stick-built homes are around $200,000+

It can cost a tenant $5,000¬$7,000 to move their home out of a park and thus 98% of mobile homes will remain in the same location after the second year. 75% of owners expect to stay in their Mobile Homes for 5 years or longer, and a large percentage expect to never sell.” This means that there is very little turnover and thus very little risk of losing tenants and going through the pain of finding new ones. Our parks will offer tenants safe, clean and affordable housing at competitively low cost.

Success for us is acquiring a property at a value that makes sense to us and our investors, which means buying it on the income that it is currently producing. These kinds of deals will usually come with a few issues that need to be addressed. And then doing all of the necessary repairs and filling of empty lots to provide safe clean and affordable housing for people.

The actual cost needed to perform this will vary and depends heavily on the size and  price of the property, cost of infrastructure repairs on homes, due diligence, cost of off site management and the cost of bringing in new or used homes to fill empty lots to complete the turnaround process to stabilizing the property.
The amount we are asking for is $2M this amount would cover acquisition of park and all of the above mentioned .


America is a rapidly changing market when it comes to housing. People are fleeing the urban centers and the net winners of this migration are small towns. Suburbs and exurbs are absolutely booming right now, at a level unprecedented in American history. Houses that sold for $50,000 a few years ago are now selling for $250,000. With the massive run-up in values comes a gigantic need for affordable housing. Most small towns have virtually zero multi-family, and if builders start new projects the monthly rents will far exceed $1,000 per month. In this way, mobile home park owners in small towns are protected from competition on any front.


I can be reached at 920-268-8880 or 920-257-6385



Best regards,
Kelvin Ayres
Shannon Ayres