The MHP Brokers Tips and Tricks Closing Cocktails Podcast Interview with Paul Schaaf of The Mobile Home Park Broker

In this episode of The MHP Broker’s Tips and Tricks Closing Cocktails podcast, Maxwell Baker, president of The Mobile Home Park Broker, interviewed company broker Paul Schaaf on his recent success handling the Glenwood Mobile Home Park transaction in Tennessee.

This and every episode of Closing Cocktails is presented by The MHP Broker’s’  proprietary Community Price Maximizer. Use this four-step system to get the highest price possible for your mobile home park or RV community when you sell it through The MHP Broker. Guaranteed. Call Max for details.

Here Are the Show Highlights:

• Paul took on Glenwood MHP, a great TN park that proved challenging to market because of the small size of its lots. But Paul found the right buyer, and the right solutions to the park’s problems, and was able to close–just as he can close on your park despite whatever challenges it might have. (Max, 1:09)
• The park’s in a good location of eastern TN, which is turning into a strong retirement area. The region also has some of the best golf courses in the state. Glenwood had about 60 lots, but was only at about 37 percent occupancy. There was a lot of opportunity there since other mobile home parks in the area were at about 90 percent occupancy with home rents at the $900 – $1,200 range and lots averaging about $400 – $450 a month. There were a lot of offers for Glenwood, but those small lots ultimately drove serious interest away. (Paul, 1:43)
• One of the big stepsPaul had his client take was to move some of the power lines to open up the space. They also found a couple manufacturers who ere making smaller, two-bedroom homes that would better fit the space and could be arranged strategically with the larger homes to improve lot sizes and the look of the park. The fact that the property was on city water and all pads already had infrastructure in place were good selling points. And there was a big demand in the area for affordable housing, so the newly laid out park was now much more desirable. (Paul, 3:27)
• The buyers were a family very experienced with commercial real estate ownership, but they were breaking in to the mobile home park business for the first time. They were very careful with their due diligence. Paul thinks they’ve already raised rents and are infilling those empty lots. (Paul, 4:41)
• Paul learned from this deal the importance of knowing what you’re going to be up against that might challenge the sale and to come up with effective solutons. You’ve got to be able to see the park for what it is, and how it can be improved if it has to be to meet market expectations. (Paul, 5:35)
• If you’re a buyer in a decent market, even a park with problems can be improved and value added if you know how to do it and are willing to invest the time and money. (Paul, 6:24)

Even parks with warts can attract motivated buyers. We can show you how to add value to a park in a great location, even if significant work must be done. Call Paul or Max at The Mobile Home Park Broker, (678) 932-0200.

Power Quotes in This Episode:

“We are very good overcoming (challenges) because we’ve seen everything thrown at us in the mobile home park and RV world.” (Max, 1:09)

“It was just a matter of putting together the best plan because the demand for affordable housing was there.” (Paul, 3:27)

“I think (the new owners) are already infilling and have raised rents. And they’re already off to the races and have done well.” (Paul, 4:41)

“If you have the right plan together, and you know how to infill quicker, and you’re in a decent market, you know, when things change in the next three to five years you’re gonna be sitting in a really good position.” (Paul, 6:24))

00:02

Hello and welcome to the mobile home park brokers tips and tricks. This is the podcast where we talk about mobile home park investing, because that’s what we’ve been involved in for the last decade. Let’s dive into today’s episode. Here’s your host, Maxwell Baker.

00:22 Maxwell Baker

Hey y’all welcome to another epic episode of the mobile home park brokers, tips and tricks, podcast. As always, this episode is brought to you by the community price Maximizer. It is our proprietary system that will guarantee you and only you the highest price when you exclusively with us, give us a call (678) 932-0200. As always it is my honor to give Paul Schaaf here on the line, because Paul just closed another deal. So, Paul, welcome to the show.

01:04 Paul Schaaf

Hey, Max, thanks for having me. Definitely. Always a fun time with you when we’re closing deals.

01:09 Maxwell Baker

Yeah, man. So, this deal was quite the adventure. It was in a great market in Tennessee. But for some reason we had some troubles in and out because a lots were a little small. But Paul found the right buyer and just like he can for any of the sellers listening, he can do the same for you, no matter what the issues are. We are very good at overcoming them because we’ve typically seen everything thrown at us in the mobile home and RV world. So, Paul, tell us a little bit about this park that you sold in the buyer profile and the stuff that you learned.

01:43 Paul Schaaf

Yeah, definitely. Good market because it was growing a little bit about the area, it’s more eastern Tennessee and it’s turning into more of a retirement area, has some of the best golf courses in Tennessee. They actually opened up one of the first bikinis in Tennessee, which is pretty neat in itself. But the park has roughly 60 spaces, the occupancy was pretty low was right around 37%. But that left a lot of meat on the bone for the next investor to infill with about 40 Watts to bring in new homes or use homes and set up some sort of ringtone credit town or, you know, third party financing. So a lot opportunity the other parks in the region we’re kicking bought, they were pretty much 90% occupied and getting anywhere from 900 to 1200. On their home rents. Lot rents were come, you know, encroaching 400 to 450. So a lot of opportunity just needed to be run better. And that’s the type of profile we we targeted. And we were able to deliver multiple offers. We actually had close, I believe 250 nda signed over the course of you know, marketing it, and just a lot of interests in the park.

03:14 Maxwell Baker

The biggest issue with this park, y’all from what I remember, the poll was that it had smaller lots, which cause a couple of people to shy away from it. Tell us what you did to overcome that.

03:27 Paul Schaaf

Yes. So, you know, it was about the power lines being you had to move around some of the power lines and make sure you weren’t encroaching on those. And that was ultimately the workaround, right, as far as easements and whatnot. also spoke with a couple manufacturers in the region, and they were pumping out some smaller homes, two bedrooms, one baths, that would work for, you know, some of the smaller lots in this community. And then, you know, so you just had to come up with a hybrid approach of Alright, which larger homes would fit on this lot. And the smaller homes on, you know, some of the smaller lots as well, but I mean, it; there was a lot of potential there because the pads already had the infrastructure there. And it was on city utilities. So, you know, it’s just a matter of putting together the best best plan because the demand was there for affordable housing.

04:25 Maxwell Baker

Yeah, I mean, that part of Tennessee has always been pretty powerful. I’ve been up there and looked at a lot of parks and a lot of them are pretty full. What was the buyer profile look like? Were they a regional local mom and pop father son, father, daughter, well, how what was the profile like?

04:41 Paul Schaaf

Yes, so, they had experience and other commercial real estate, but we’re looking to break into MH, that was who ended up taking down the deal, newer but had a lot of commitment and already had found who their their dealers and did a lot of diligence on mapping out the park and making sure the infrastructure was was ready for it and they did a lot of mobility analysis as well. So it was a newer buyer. But with all the opportunity, that’s what was the motivation? And I think they’re already filling in and have raised rents and they’re already off to the races and doing well.

05:21 Maxwell Baker

Love hearing that man love hearing. What was the biggest thing you learned from this deal? You know, by taking this to market dealing with some of the drama with the infrastructure like, you know, on the next one that we find that similar to this, what do you think you learned?

05:35 Paul Schaaf

Yes. So, I mean, it’s always good to know, setbacks for each municipality, is a good learning curve there. And making sure hey, you know, an owner can say that they have a certain number of spaces, but can it really take on newer home sizes, and infrastructure wise, is the capability of the infrastructure, they are in place to take on an overhaul of a park, and really improve it? So just making sure you understand hey, yeah, there, it seems like there’s a lot of good opportunity on the surface, but you really got to know, Hey, is he electrical there to support it? And then of course, your water and sewer, making sure there’s checkout appropriately.

06:19 Maxwell Baker

Nice, man. Well, Paul, I appreciate your time here. Any closing thoughts here before we sign off?

06:24 Paul Schaaf

I just think it’s just one of those deals where in today’s market with interest rates, the value adds or, you know, a really good asset class right now, because, you know, if you have the right plan together, you know how to infill quicker and you’re in a decent market. You know, when things change in the next three to five years, you’re gonna be sitting in a really good position. If you follow through, what’s your plan on value add, and making sure the park is just completely improved. You’re going to be sitting pretty down the road.

06:56 Maxwell Baker

Nice, man. Well, congrats again, Paul Schaaf everyone he did what others couldn’t and was able to put this deal together. This deal had been been trying to be sold for quite some time and all came in and and saved the day and did a great job. So, if you all have any kind of parks, that are your problem, children, or if you have any parks that you’re just looking to cash out because you’re ready to retire Paul is standing by and you can reach them at (678) 932-0200 or email us at info at the MHP broker.com and as always, we appreciate y’all as listeners out there. Let’s always keep moving forward y’all, have a good day!