Welcome to episode 30 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Jefferson and Brad are joined by a very special guest, John Hurd, on this episode. John is a mobile home park owner, broker, fee manager as well as turnaround expert for parks for other owners. John’s favorite quote is, “When in trouble, make more money”. Listen in to discover John’s experiences and insights on running a successful mobile home park business.
Key Takeaways:
[1:40] How did John get into the business of mobile home parks?
[4:16] How to go about sourcing the best mobile home park deals―John shares his experiences.
[8:15] True Blood, gunshots, a lost baby, and other creepy stuff―John has seen a fair share of horror stories when turning around some parks.
[12:03] What are some of the most difficult problems to deal with? A park with a drug problem? High vacancy? Tenants that culturally don’t think they have to pay rent?
[12:57] Cleaning out a meth house is a seriously tough business.
[14:11] How do you know if there’s a meth house in a park?
[15:46] How to effectively deal with a meth problem to ensure a safer park for tenants.
[17:25] Not all parks have a meth problem and John has seen a dramatic drop in the last couple of years.
[17:55] How to avoid making some common due diligence mistakes made by mobile home park buyers.
[22:26] Why Managing mobile home parks is John’s favorite part of his business.
[26:25] How did John find the asset managers and book keepers working at his headquarters?
[27:28] How to find houses when you’ve got vacant lots to infill―Do you buy new or used homes for your park?
[30:16] Has John seen any material change in valuations of parks over the last couple of years?
[32:17] What is John’s compensation for taking over a turnaround park vs. a more stabilized park?
[33:24] John tells us more about his 38 foot mobile home and how he got it tricked out!
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
Park Street Partners Business Resources
LinkedIn: Mobile Home Park Investors Group
Send deals to: deals@parkstreetpartners.net
John’s website: Johnhurd.com
Email John: john@johnhurd.com
Call or Text John: 361-522-5564
Welcome to episode 29 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly, as Brad Johnson is off this week. This week, Jefferson dives into three hypothetical scenarios and offers practical math on whether you should build your mobile park home from scratch or purchase a pre-existing mobile home park. And he covers using Berkshire Hathaway's 21st Mortgage CASH program (or equivalent) to infill your mobile home park with mobile homes. Find out more by listening to Jefferson's detailed analysis.
Key Takeaways:
[1:10] Today's topic is about why you should never build a mobile home park from scratch!
[3:05] Do you want to buy an up and running property or build it? Jefferson goes through three different scenarios.
[4:35] Let's talk numbers with these three hypothetical scenarios.
[13:00] What would your first year of business look like if you built from scratch?
[21:10] What happens if you pay for your mobile homes using Berkshire Hathaway?
[27:00] If you bought an already established mobile home business, what would the cost come out to be?
[32:50] Being generous with the numbers, if you try to sell your mobile home property after 5 years, your IRR will be -9% every year.
[36:15] If you bought an already established mobile home business, you would have made 23% per year.
[38:40] What's the liability if you were to use Berkshire Hathaway?
[45:45] When would it make sense to buy a mobile home from scratch?
[47:15] There's a big difference in being in the affordable housing business vs. being in the construction business.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Email your deals to: deals@parkstreetpartners.net
Welcome to episode 28 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly, as Brad Johnson is off this week. This episode is quick but informative. We get a lot of questions, at Park Street Partners, about whether Section 8 is something that people should accept. In a nutshell, the answer is that it varies, based on where your mobile home park is. Listen in to find out if it makes sense for you to accept Section 8.
Key Takeaways:
[1:13] Jefferson has been accepting Section 8 vouchers for ~ 7 years, in Oklahoma, and it’s worked out quite well. Find out why!
[2:23] Jefferson has heard that section 8 tenants are really rough in the Southeast.
[2:50] Great tips on whether it makes sense for you to accept section 8, but don’t rule it out.
[4:28] Quick little tidbit on the H.R. 3700 legislation. Find out what the significance of this legislation is in relation to Section 8.
[6:34] Jefferson speaks on his experiences for those who may actually start accepting Section 8.
[9:55] Some reasons why you would want to accept Section 8.
[11:51] Couple of caveats to be aware of with respect to Section 8.
[16:16] How to best connect with the Park Street Partners if you’re interested in co-investing in a mobile home park.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Email your deals to: deals@parkstreetpartners.net
Welcome to episode 27 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson. Dyches Boddiford, real estate investor and educator, shares his wealth of knowledge with Jefferson and Brad in a two part interview. If you missed the first part of the interview, check out episode 26, where Dyches talks about his background, having nearly 4 decades of experience investing in real estate, and how he uses land trusts and personal property trusts to protect his assets. Today, in the second part of the interview, you’ll hear more about how Dyches uses tax-advantaged accounts such as self-directed IRAs, health savings accounts and educational savings accounts to own real estate, and more.
Key Takeaways:
[2:02] The best ways to buy real estate using more tax-advantaged accounts such as IRAs, solo 401(K), Coverdell ESA, and HSA.
[2:55] You’ve got to understand the prohibited transaction and disqualified party rules before starting to do self-directed investments.
[7:59] Dyches talks on rules pertaining to the Coverdell savings account.
[10:23] Discover more tax saving advice from Dyches.
[13:14] Dyches shares some major lessons learned from his nearly 4 decades of experience in real estate investment.
[15:37] Contact information for Dyches Boddiford.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Email your deals to: deals@parkstreetpartners.net
Welcome to episode 26 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson. Real estate investor and educator, Dyches Boddiford, shares his wealth of knowledge with Jefferson and Brad in a two part interview. Listen to part one to hear about buying real estate (including mobile home parks), how to protect that real estate by using land trusts and personal property trusts, how to form entities properly, how to protect your assets, and more. Make sure to listen to the second part of the interview next week, to discover ways to own real estate that are more tax-advantaged such as using a self-directed IRA or an educational savings account, and more.
Key Takeaways:
[2:09] Interview with Dyches Boddiford, real estate investor and educator.
[4:21] Find out why Dyches saw mobile home parks as an investment opportunity back in the 80’s.
[5:22] Land trusts, liability protection, and 3 types of statutory entities: LLCs that hold the land, LLCs that hold the homes, and the S Corporation that holds the management of the property.
[7:36] Benefits of structuring your entities properly. Meaning, not co-mingling funds, not co-mingling assets, and treating each entity as totally separate from each other.
[9:20] Insurance is always your first line of defense.
[10:09] Dyches’ recommendations on insurance for mobile homes and mobile home parks.
[15:04] Another reason to have LLC as the beneficiary of the land trust.
[18:05] Find out why Dyches says “You won’t get a bank to agree to finance property that’s had a land trust.”
[21:43] Discover how land trusts provide anonymity and estate planning benefits.
[25:15] Hear more about successor or alternate trustees that have the ability to step in for the trustee if something happens to them.
[26:59] How to find a trustee that you can trust.
[28:55] Tune in next week for part 2 of the interview to hear about self-directed IRAs, health savings and educational accounts, other ways to own real estate, and more.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Email your deals to: deals@parkstreetpartners.com
Welcome to episode 25 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson. In today’s episode, Jefferson and Brad talk about a necessary but not always pleasant topic: how to hire and work with contractors. Whether you have a clean park and just own the land or you own any mobile homes, you’re bound to deal with contractors sooner or later. Listen in to find out how to navigate conflicts that may arise, mitigate losses, get contractors to perform, manage their expectations, and to deliver on time/on budget.
Key Takeaways:
[2:32] Discover tips and resources on finding the contractor for your newly purchased Mobile Home Park.
[6:39] What are the next steps after finding/hiring a contractor?
[8:20] Do pay the contractor upfront for all the material. Do pay them after the job is done for the labor. Do NOT pay them for the tools they should already have for the job.
[10:50] How exactly do you pay for the materials when you’re living thousands of miles away from your mobile home park?
[13:07] Find out why it’s beneficial to get a general contractor to get the bids from subcontractors.
[16:15] Problems that pop up with independent contractors and how to manage their expectations upfront.
[22:17] You can get workers comp on an independent contractor.
[23:20] Jefferson shares a story about one of the best contractors he’s ever had. Listen in to find out what things to look for in a good contractor.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Email your deals to: deals@parkstreetpartners.net
Welcome to episode 24 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson. This is the sequel of the interview that began on episode 23 with MJ Vukovich of Bellwether Enterprise. Tune in for the remainder of Jefferson and Brad’s discussion with MJ on various options for financing a mobile home park.
Key Takeaways:
[1:18] Find out what makes conduit loans so interesting.
[2:40] What insurance companies look for in a borrower.
[5:07] The kind of insurance companies MJ is referring to include, All State, Nationwide, MetLife, John & Cook’s, Lincoln Financial Group, American Equities, etc.
[6:31] Do mobile home park mortgages ever get placed directly with some of the CalPERS or big pensions?
[7:49] What CMBS lenders look for and what might disqualify a loan, either on the property side or the borrower side?
[10:07] CMBS lenders, park-owned homes and the metro area population.
[14:54] Non-recourse loans, bad-boy carve-outs and what CMBS lenders look for in a borrower.
[17:18] CMBS and mixed-use properties.
[22:03] Chattel financing or chattel loans for mobile homes.
[27:58] MJ gives a shout out to his dad, uncle and the great people at Acentia who taught him everything he knows about mobile home parks.
[30:09] MJ signs off by sharing one last story.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Email your deals to: deals@parkstreetpartners.net
Welcome to episode 23 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson. This is part 1 of a 2 part series, where Jefferson and Brad are joined by MJ Vukovich of Bellwether Enterprise, which is a nationwide brokerage firm. MJ is out of their Minneapolis office and specializes in financing mobile home parks. Tune in as MJ shares insider tips on how to finance mobile home parks, getting into conduit financing, CMBS, and bank financing.
Key Takeaways:
[0:51] Quick shout out to the show’s listeners for helping us reach about 3,500 downloads a month!
[2:41] MJ is a 3rd generation in the mobile home park business. He shares the story of how his family got into the business.
[8:50] The former Colorado Real Estate Investment Company currently has 7,000+ sites across 7 states: Colorado, Wyoming, Nebraska, Nevada, New Mexico, Texas, and North Carolina.
[10:09] Why did MJ decide to leave the family business and move on to the mortgage brokerage side of things? MJ shares the story which involves his wife.
[20:37] What are the financing options for mobile home park owners? MJ explains.
[24:34] Freddie & Fannie’s rates are very attractive but they tend to be a little less risky in their under-riding, they want higher occupancy, higher quality properties, etc.
[27:24] There are some terms that you get on a Fannie & Freddie that are unique to them and that you don’t get with CMBS. Listen in for details here.
[31:18] There’s a tough balancing act you have to do as you’re buying property. MJ provides suggestions.
[33:12] MJ compares the level of paperwork and legal opinions required by Fannie & Freddie vs. CMBS lenders.
[35:09] Where would CMBS be pricing their loans right now?
[35:48] A new regulation called Regulation AB has come to effect this year. MJ elaborates.
[39:54] MJ has one more piece of advice on MBS products from an under-riding/insider perspective.
[41:54] Tune in next week for episode 24 to continue getting mobile home park financing insights from MJ Vukovich.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Send your deals to: deals@parkstreetpartners.com
Welcome to episode 22 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson. Today, Jefferson and Brad share a host of funny and true stories about things they’ve heard brokers say. Obviously, these are things that are generally not true or somewhat misleading, so you should be aware of them. Tune in for a light and fun episode that will also help you get prepared for the sort of things you may hear from real estate brokers sitting across the table from you.
Key Takeaways:
[1:32] Caveat - the Park Street Partners love the brokers that they deal with, but they have also been told things like, “sewage lagoons are wonderful”, by brokers.
[3:51] Don’t let any broker tell you that anything other than City Water and City Sewer is somehow better.
[5:35] When you find red flags during diligence and a broker says, “Don’t worry about that, you’ll run the property much, much better than he will”.
[7:14] “If you don’t hurry up and buy this park…I’ve got another buyer who’s gonna snap it away from you” - said by a broker.
[9:20] One broker sent Brad an off-market deal with few details about the area it was located in - turns out it was located in a 250 person town with no county and in the middle of nowhere.
[10:31] When you ask if a deal meets all your criteria and a broker says, “Well, I think it’s gonna be right at the edge of your criteria”.
[11:40] A broker once pitched 10 million bucks for a 10-pad mobile home park located in the Canadian oil sands.
[13:27] Brokers have said, “There has never been a plumbing expense, that’s why that line item doesn’t appear”, but that’s almost never the case.
[14:27] Brad shares a few more of the funny broker stories he has heard.
[15:30] “This is a 10, 12 cap on paper - easy.”
[17:34] Any broker that’s listening to this podcast - “we are not talking about you”.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Send your deals to: deals@parkstreetpartners.com
Welcome to episode 21 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson. Today, Jefferson and Brad talk about the Manufactured Housing Institute (MHI), which is the mobile home park industry’s chief nationwide lobbying group. They work to fend off government regulation that's “suppose to help” the industry and try to get some helpful regulations in place. MHI holds the two big annual meetings in the mobile home park industry. Tune in to hear the highlights of the MHI meeting in Las Vegas and learn more insider tips on doing business in the mobile home park industry.
Key akeaways:
[0:56] Quick shout out to MHPI podcast listeners - Thank you for listening to the show!
[3:07] What’s so great about attending MHI trade shows?
[5:25] Are you a newbee & considering going to MHI? Jefferson has some great tips to share.
[7:25] What’s so valuable about spending a great amount of time with brokers and other industry professionals?
[9:44] Aim to get invited to the dinner & cocktail parties. That’s where you get to know the folks that can be showing you deal flow or arranging financing, and get to meet other owners.
[11:26] Also try to meet some of the mortgage brokers.
[12:20] Listen to episode 20 to hear the interview with ndustry legend Jim Clayton, which was recorded at the MHI meeting in Las Vegas.
[13:00] What did Jefferson & Brad do after recording last week’s podcast at the MHI
conference?
[13:29] You’ll find insurance brokers and mobile insurance companies at MHI.
[15:27] On future podcasts, we’ll do some deeper dives into real estate brokerage, insurance, and water meters.
[15:39] You will also find water meter companies at MHI.
[18:00] Brad speaks to the industry lobbying part of MHI.
[20:28] There was a funny discussion about what to call this business. Thoughts on Land Lease Lifestyle Community?
[22:10] Check out an MHI meeting at least once if you plan on getting into the mobile home park business.
[23:23] NCC which is mainly about owners, is a subgroup of MHI. Jefferson & Brad will be attending the upcoming NCC meeting in November in Chicago.
Mentioned in his Episode:
Park Street Partners
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Mobile Home Park Investors
Mobile Home Park Investors Group on LinkedIn
Send your deals to: deals@parkstreetpartners.net
Manufactured Housing Institute (MHI)
Security Mortgage Group
Wells Fargo
Greenfelder Insurance
Mobile Insurance by Kurt Kelley
Welcome to episode 20 of the Park Street Partners’ Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson. Today we have a very special podcast, because not only we have the first interview on the show but also because it’s with industry legend Jim Clayton. The interview was recorded live at the Annual Manufactured Housing Institute Show in Las Vegas last week. Stay tuned to hear what Jim had to say about the future of mobile home park investing, estate planning, ESOP, the competitive advantage offered by Clayton Bank and Trust, the future of manufactured housing, and even Jim's thoughts on Donald Trump vs. Hillary Clinton!
Key Takeaways:
[1:06] Jim started Clayton Homes which became America’s largest mobile home park manufacturer. He took that company public & ended up selling it to Berkshire Hathaway through Warren Buffett, for about 1.7 billion dollars.
[1:57] The Park Street Partners have borrowed money from Jim’s bank & have been very happy with their relationship with Clayton Bank and Trust.
[2:26] We encourage you to reach out to Clayton Bank and to Kevin Clayton who is the President.
[2:41] Jim wrote an autobiography titled First A Dream, which turned out to be the catalyst for his deal with Warren Buffett.
[3:58] How did Jim get into the mobile home park investing business?
[5:12] How much of a plan did Jim have when he first started dealing in mobile homes? Was he surprised by his success?
[5:41] How did Jim transition from dealing in other people’s used homes to getting into manufacturing?
[7:16] Jim Started Pre-HUD manufacturing, so he could basically design a house any way he wanted.
[9:46] How did financing a mobile home work back in the 1960’s?
[10:52] Clayton Bank and Trust, compared to other banks, will lend on both the land itself and the chattel park-owned homes offered.
[12:27] What’s Jim’s take on the future of manufactured housing as it relates to the debate on nicer communities with stick-built housing vs. nice, clean, safe & affordable housing for families?
[14:19] When and how did Jim first meet Warren Buffett? What was he like to deal with when Jim was considering selling Clayton Housing to Buffett?
[17:51] What sort of due diligence did Warren Buffett do?
[18:54] Jim’s advice to folks that might consider investing in the mobile home park business now – Jim is extremely optimistic!
[20:25] Do you think that the GSEs will eventually start buying and guaranteeing these loans for financing? Depends on Donald Trump vs. Hillary Clinton!
[21:15] When Jim sold his business to Warren Buffett, he could've easily retired – So what possessed him to keep working?
[24:18] What advice does Jim have for Jefferson and Brad and their passion for mobile home park investing?
[25:29] More about the industry legend, Jim Clayton and key takeaways from the interview.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Send your deals to: deals@parkstreetpartners.net
Welcome to episode 19 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with Park Street Partners. Today, Jefferson and Brad discuss a case study on a mobile home park that’s near and dear to their hearts. It’s called the Cherrywoods Mobile Home Park and it’s the first deal they bought in their partnership.
Key Takeaways:
[1:48] The Mobile Home Park Investors podcast has over 3000 downloads per month!
[2:40] Check out Cherrywoods.net to see how the Park Street Partners set up their websites.
[2:57] Jefferson and Brad talk about how they found the Cherrywoods Mobile Home Park and all the things they love about this property.
[5:34] The Cherrywoods Park was developed in 1996, which is a rare find.
[6:56] The seller was open to seller financing, which is something the Park Street Partners love.
[11:59] Current rents on properties in the same town, according to rentometer.com.
[14:21] The type of property manager to look for and that you want to have for your park.
[17:29] Jefferson and Brad have easily doubled their money on the property, in a little under two years.
[18:57] Jefferson touches on determining capital rates from looking at the property’s PNL.
[20:42] It wasn’t obvious they were going to fill up the Cherrywoods Park as well and as quickly as they have. What were some signs of softness in that market?
[25:32] Selling the Cherrywoods property today would produce a nice return but that doesn’t beat getting 25% cash-on-cash returns for the foreseeable future.
[27:30] Check out episode 18 to hear all about how the returns can be nearly tax-free.
[30:21] What’s the debt service coverage ratio on the Cherrywoods park?
[32:56] Interested in partnering up? Check out episode 14 to learn the specifics of the Park Street Partners’ partnership strategy.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Send your deals to: deals@parkstreetpartners.com
EP018: Accelerate Your Depreciation to Save on Your Mobile Home Park Property Taxes
EP014: How to Partner and Invest with the Park Street Partners
Welcome to episode 18 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad follow up on episode 17, which was all about taxes and only briefly touched on depreciation. Today’s episode will focus exclusively on depreciation and will get into details on why mobile home parks are such a great tax strategy to legally shelter income through accelerated depreciation.
Key Takeaways:
[1:35] It doesn’t really matter how much you make, it matters how much you keep.
[2:41] “Mobile home parks are just land.” “There are no assets to depreciate.” “Land is not depreciable; therefore mobile home parks have no depreciation.” - WRONG!
[3:42] Jefferson gives a rundown of what this asset class actually is.
[4:09] On average, you can probably depreciate about 75-80% of the mobile home park’s purchase price.
[4:31] Not only do parks kick off a lot of cash flow relative to other asset classes in real estate, but the vast majority of that income is tax-free.
[5:58] What does it mean to have 75% of the purchase price of a mobile home park depreciated?
[8:12] How to go about analyzing how much depreciation you will have on your mobile home park.
[12:01] Once you’ve established what your non-depreciable land value is, then you know everything else is going to be allocated to an asset or to goodwill.
[14:08] Resources available to value your property include firms specializing in cost segregation and some appraisers.
[16:23] How to think through segregating out improvements and whatever leftover goodwill...In the end, don’t forget to take your depreciation.
[18:32] While it’s nice to make a high return, what matters the most is the after-tax returns.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Send your deals to: deals@parkstreetpartners.net
Welcome to episode 17 of the Mobile Home Park Investors podcast hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad discuss taxes and share helpful tips to help you save on your mobile home park property taxes. Listen in for advice on tax depreciation, how not to pay double taxes on your ‘wheel estate property,’ preparing your CPA for the April 15th deadline, miscellaneous business expenses, and more.
Key Takeaways:
[1:39] Today’s episode will cover depreciation briefly. Check out episode 18 for a more in depth discussion on tax depreciation.
[2:18] You can save on your taxes by segmenting out the component costs of any mobile homes that come with your park.
[4:36] Jefferson shares another tax saving idea.
[8:45] Brad shares tips, especially for 1st time mobile home park owners, on getting your CPA prepared for the April 15th deadline.
[10:36] Jefferson and Brad always advise purchasing your property in some sort of an entity such as a LLC.
[13:29] What is a promissory note income?
[15:13] What is rent credit income?
[16:18] Miscellaneous and other types of business expenses for tax deductions.
[18:14] What other types of expenses are really good for the ‘wheel estate property’ business?
[19:57] Talk to your CPA to make sure you understand how your tax basis is being adjusted every year.
[21:37] A 1031 exchange is always a good idea. Upcoming podcasts will feature a 1031 exchange expert who will step us through the 1031 process.
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Send your deals to: deals@parkstreetpartners.com
Welcome to episode 16 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad talk about how to market a mobile home park. This is obviously an important thing to do and they have specific advice and resources to share on today’s episode.
Key Takeaways:
[1:39] Why is it important to market your mobile home park?
[3:18] “The 800-pound gorilla for advertising in our space is Craigslist.” Brad outlines the pros & cons of advertising on Craigslist.
[6:24] Where do the Park Street Partners get their leads from?
[6:53] What Jefferson used to do but doesn’t anymore!
[8:11] How can you use Facebook & your creativity to advertise properties?
[13:42] What are the advantages of having a website & using Squarespace to create, manage and host your website?
[15:30] How does having a website enables you to use other online services to help you promote your property?
[17:02] What other resources can you use to have a digital presence and promote your property?
[18:49] What are the advantages of using all these resources and doing all this marketing?
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Email your deals to: deals@parkstreetpartners.net
Cherry Woods Mobile Home Park
Welcome to episode 15 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad discuss some of their deals that have fallen out of bed for various reasons. These include deals they passed on after having done varying levels of diligence, all the way to the point of having them under a contract. Listen in to learn how not to let your emotions lead you to closing a bad deal.
Key Takeaways:
[1:12] What not to do when closing a deal? Don’t let your emotions guide you no matter what.
[2:44] Tale from the road to closing the Blue Grass State deal.
[5:21] As Warren Buffet advises…invest in a business that any idiot can run because sooner or later, one will!
[6:07] What are some red flags to look out for when you’re in the process of closing a deal?
[9:37] Tale from the road to closing the Texas deal.
[13:19] Why was the Park Street Partners’ 1st deal (a single-wide Michigan) a bummer and why did they call 113 banks?
[18:06] Another tale from the road to closing a double-wide Michigan deal.
[20:59] The Indiana deal seemed like a great opportunity, but the seller back paddled out of the deal.
[25:31] What kind of due diligence issues have lead the Park Street Partners to cancel a deal?
[26:42] What are the key lessons learned from some deals which have fallen out of bed for various reasons?
Mentioned in This Episode:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Send your deals to: deals@parkstreetpartners.net
Welcome to episode 14 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad will discuss details on how you can partner with them or 'bird dog' for them. Over the last year, many people have reached out to PSP and shown interest in jointly investing and partnering with them. They will talk about some of the partnerships they have done in the past and guide you on what they look for in parks. Their goal is to help you be more efficient in your search, also to be more efficient for them when they get deal flow that is really focused on what they consider to be the best kind of parks to acquire.
Key Takeaways:
[1:53] What kind of deals add value for the Park Street Partners?
[4:41] Brad details some of their acquisition criteria.
[8:03] Jefferson lets us in on a little secret!
[9:56] Brad talks about some red flags on a property.
[11:34] Details on specific situations that they have partnered with folks, in the past.
[12:21] Their 1031 exchange deals, main ways you can partner with them, and how they have partnered with people in the past.
[14:20] Jefferson & Brad are flexible to work with people! They are happy to explore partnerships, and to educate/coach you on a deal.
Mentions:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
You can send us deals to deals@parkstreetpartners.com
Welcome to episode 13 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad will discuss Capital Expenditures (CAPEX), which are generally larger ticket items that you will be paying for with your mobile home park property, at some point or another. Of course, if you do your due diligence up front, you might not need some of these, at least not in the near-term. So today, Jefferson and Brad will talk about some of the large ticket items they have had to spend relatively larger dollars for, such as roads and utility lines.
Key Takeaways:
[1:26] These large ticket CAPEX items may sound scary, but here is the bright side!
[3:19] Capital expenditures for repair & maintenance on buildings vs. land.
[4:57] The biggest large ticket/one-time, non-recurring expenses for mobile home parks are water & sewer pipes.
[8:47] New technologies can reduce repair & maintenance costs and help keep your capital expenses lower.
[9:52] Roads are probably the 2nd biggest capital expense that you can have.
[15:37] Note: we have covered CAPEXs on roads & utility lines, assuming your park is on the public water & sewer system.
[16:40] Another potentially large capital expenditure item: Water meters.
[19:39] American Lead Detection (ALD) is technically not a capital expense but it can lead to some capital expense work.
[23:28] Improvements you can make to the signage of the park that are not expensive from a capital stand point.
[24:46] Info. on tax treatments for all of these capital expenditures.
[25:27] Rough rule of thumb on how much you should budget for CAPEXs.
Mentions:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
You can send us deals to deals@parkstreetpartners.com
Welcome to episode 12 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. This is part 3 of a 3 part series where Jefferson and Brad discuss what you should do over the first 30 days that you own your park. On this last episode of the 3 part series, Jefferson and Brad will discuss managing the books, the new rules and regulations, why Pitbulls are a ‘vicious’ breed, and more!
Key Takeaways:
[1:20] After covering PNLs on episode 11, the discussion moves onto the books.
[2:40] Jefferson managed his books for his park for about the 1st 4 months.
[3:31] You can use software to make the process simple!
[4:50] Distributing the new rules & regulations to your tenants.
[5:20] The No Vicious Breed Dogs Policy in the rules & regulations is very important.
[7:37] Why Pitbulls are now a high risk breed? See article by Malcom Gladwell!
[8:26] What if a tenant rejects the rules & regulations? Or what if they don’t sign the rules & regulations & return it?
[10:03] Join your local state’s Manufactured Housing Association for free resources on rules & regulations.
[11:11] Make sure all utilities are put into the new entity name.
Mentions:
Park Street Partners www.parkstreetpartners.com
Mobile Home Park Investors www.mobilehomeparkinvestors.net
deals@parkstreetpartners.com
Park Street Partners - Investment Opportunities
Park Street Partners - Resources
Mobile Home Park Investors Group on LinkedIn
Welcome to episode 11 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with Park Street Partners. This is part 2 of 3 episodes where Jefferson and Brad discuss what you should do over the first 30 days that you own your park. Following up on last week’s cliff hanger, today’s episode will cover advice on setting up your park’s website, marketing and advertising, and installing or managing your park’s water meters.
Key Takeaways:
[1:28] You can easily set up your property’s website using Square Space or Wix.
[3:44] Square Space has some cool analytics that show traffic volume.
[4:20] What are the key things to put up on your website?
[6:58] You can advertise across various sources such as Zillow, Craigslist, and Trulia.
[8:48] Include your URL in the medium you advertise in.
[11:32] Make sure to get new signage for your park.
[13:56] Jefferson discusses details and importance of installing a water meter in your park.
[19:13] Don’t try to make a profit on the water.
[22:05] How to manage if your park already has water meters, meaning it’s sub-metered.
[25:19] Listen to next week’s podcast for part 3 on the first 30 days of owning your park.
Mentions:
http://www.parkstreetpartners.com/
http://www.parkstreetpartners.net/real-estate-syndication/
http://www.parkstreetpartners.net/resources/
http://www.mobilehomeparkinvestors.net/
https://www.linkedin.com/groups/131404/profile
Welcome to episode 10 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. This is part 1 of 3 episodes where Jefferson and Brad will discuss what you should do over the first 30 days that you own your park. That is a very key transition period, which will set the tone for your management style with the manger as well as with the tenants. Hence, it’s a highly critical 30 days to get right. If you invest the time, effort, and a little bit of money in getting your first 30 days done correct, then you should have fairly smooth sailing going forward. Today’s episode will cover advice on the park manager, collecting rent, and the telephone!
Key Takeaways:
[1:39] One of the critical issues to address is, what to do with the park manager.
[4:00] Advice on finding a new manager for your mobile home park – Putting up flyers.
[5:55] What to do if you love the manager but they’re not tech-savvy!
[7:48] What if you’re remote & can’t put up flyers on the front doors of mobile homes?
[9:28] Other ways to find mangers – Placing ads in Craigslist or workingcouples.com.
[11:12] Don’t feel panicked if you haven’t found the perfect manager and are about to close.
[11:54] Collecting rent by using rent boxes.
[12:54] Jefferson & Brad are a big fan of onsite rent boxes.
[13:35] The advantages to having a rent box.
[15:11] You want to get the rent in as quickly as possible.
[17:01] Jefferson & Brad recommend having a centralized rent box installed onsite.
[17:25] The telephone is a critical component of the first 30 days.
[17:46] Jefferson explains setting up & working with Grasshopper.
[22:10] Stay tuned for more on what to do in your first 30 days, coming up in episodes 11 & 12.
Mentions:
http://www.parkstreetpartners.com/
http://www.parkstreetpartners.net/real-estate-syndication/
http://www.parkstreetpartners.net/resources/
http://www.mobilehomeparkinvestors.net/
https://www.linkedin.com/groups/131404/profile
http://www.workingcouples.com/
https://www.craigslist.org/about/sites
Welcome to episode 9 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad are going to talk about closing a deal on a mobile home park. They will detail what sorts of documents and procedure are required in order to have your money go to the seller and have title come from the seller to you. At a high level, that’s what closing is all about, money goes one way and title goes the other.
Key Takeaways:
[2:14] The 1st step to take once you have an agreement to purchase property.
[3:21] If you don’t get title, what are you really buying?
[4:46] The next step to take after signing paper work.
[6:29] How can you establish yourself as a legitimate buyer?
[6:47] More importantly, you don’t wanna give the seller an excuse to cancel the deal.
[8:06] Part of opening escrow involves the title company opening their preliminary title process.
[8:30] What are you actually buying with title insurance?
[11:23] Jefferson discusses the actual process of signing documents.
[15:07] What is the settlement statement? Brad explains.
[18:44] The last step taken by the title company to close a deal.
[19:02] How does Jefferson like to celebrate when he closes a deal?
Mentions:
http://www.parkstreetpartners.com/
http://www.parkstreetpartners.net/real-estate-syndication/
http://www.parkstreetpartners.net/resources/
http://www.mobilehomeparkinvestors.net/
Welcome to episode 8 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad will discuss seller carry, also known as seller financing. This is when a seller of a mobile home park carries back the mortgage, which allows the owner of the mobile home park to not have to deal with a bank to get a mortgage and to close a deal more quickly.
If you like this podcast, please subscribe to it on iTunes or Stitcher and rate us highly.
Key Takeaways:
[1:29] It’s best to negotiate directly with the seller, even if buying property through a broker.
[2:30] What are the benefits for a seller to carry back the mortgage?
[7:53] Brad explains the depreciation recapture component of seller financing.
[10:07] The downside for a seller to carry back the mortgage is de minimis.
[12:37] The best part about seller financing.
[13:19] A key benefit for a seller who offers seller carry.
[13:42] What to do once you agree to seller financing.
[16:17] Much easier to get a deal done when a seller agrees to let you pay them back over time.
[16:32] Another benefit for the seller to carry back paper.
[17:52] It’s important to treat your sellers well; and they can serve as a reference for you.
[19:25] Negotiating the debt documents, cure rights, and the promissory note.
Mentions:
http://www.parkstreetpartners.com/
http://www.parkstreetpartners.net/real-estate-syndication/
http://www.parkstreetpartners.net/resources/
http://www.mobilehomeparkinvestors.net/
https://www.linkedin.com/groups/131404/profile
Welcome to episode 7 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad will discuss third party reports. If you have a mobile home park under contract and are looking for any type of debt, this is the time for getting down to brass tacks. Even if you’re paying all cash for a park, 2 of the 3 third party reports are very important no matter what, and the 3rd one is important specifically to a bank.
Key Takeaways:
[1:23] 1st third party report: the Phase 1.
[3:02] How you could be liable for ‘LUST’? – Leaking. Underground. Storage. Tanks.
[4:50] If there is LUST, you’ll need to do a Phase 2 report.
[5:47] More on phase 1 – costs and desktop reviews.
[7:05] 2nd third party report: the Survey.
[8:29] Boundary survey vs. full ALTA survey.
[9:49] Key things to look for on the survey.
[12:00] 3rd third party report: the Appraisal.
[15:26] Problems with appraisers who are not specialized in park appraisals.
Mentions:
Join the LinkedIn Group: Mobile Home Park Investors
Please rate the podcast on iTunes or Stitcher
Please subscribe to the podcast on iTunes
Welcome to episode 6 of the Mobile Home Park Investors podcast, hosted by Jefferson Lilly and Brad Johnson, with the Park Street Partners. Today, Jefferson and Brad will share their insights on finding a loan in order to invest in a mobile home park. You actually need to pay for your mobile home park in order to buy it!
Key Takeaways:
[1:12] Debt eligibility varies with the size of the park.
[5:03] Information required by banks & how to show you are a credit-worthy borrower.
[7:21] What can you expect on your first loan?
[8:50] Dealing with state-wide banks.
[11:08] The first question to ask a lender.
[13:54] Jefferson shares an amusing story on his experience with lenders!
[18:13] Lesson learned: persistence pays!
[18:38] What are banks looking for?
Mentions:
Join the LinkedIn Group: Mobile Home Park Investors
Please rate the podcast on iTunes or Stitcher
Please subscribe to the podcast on iTunes