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

June 7, 2024 by Maxwell Baker

In this episode of The MHP Broker’s Tips and Tricks Closing Cocktails podcast, Maxwell Baker, president of The Mobile Home Park Broker, interviewed leading broker Paul Schaaf on one of his latest deals.

Just like with every Tips and Tricks Closing Cocktails podcast episode, this one’s brought to you 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 up Max for details.

Here Are the Show Highlights:

  • Paul Schaaf was The Mobile Home Park Broker’s top producer at the mid-year mark. He’ll talk about a recent challenging but successful transaction in Arkansas. (Max, 1:06)
  • The sale had a few stumbling blocks that made it take longer to close than usual. For one thing, the owners had to do a lot of work before they could even list the park. It had been in bad shape when they acquired it, and they had to bring in new homes, improve the tenant base and get cash flow to the point where it would appeal to buyers. (Paul, 1:16)
  • The appraisal went fine, but local banks were reluctant to get involved due to high interest rates and the presence of a lot of park-owned homes in the deal. Fortunately, the owners kept good books and showed how revenue had increased steadily. Paul found a motivated buyer who’d just sold a farming business and wanted to own a mobile home park, especially one that could add RV lots. The buyers had a good business plan and Paul was able to connect them with an ideal mortgage broker. (Paul, 2:23)
  • The buyer got rejected a few times from lenders, and had to prove how they’d successfully run previous businesses, and collaterize some of their assets. So it wasn’t easy, but buyer and seller both ended up satisfied. (Paul, 4:03)

Regardless of the unique challenges and obstacles you might face, we think there’s a buyer for every park. Just make sure you sell through brokers who know the business and have connections that can help make the deal go through faster and at a better price–with fewer hitches. Contact Paul Schaaf or Max Baker at The Mobile Home Park Broker, (678) 932-0200.

Power Quotes in This Episode:

We’ve got the connections with the lenders, with the mortgage brokers, debt placement guysWe are very good at structuring deal stories, structuring debt and making sure you’re getting the highest price when you exclusively list with us.” (Max, 4:36)

“Times are changing, but we’re the broker that knows how to evolve and adapt.” (Max, 5:43)

00:22 Maxwell Baker

Hey y’all. Welcome to another epic episode of the Mobile 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 a higher price when you exclusively list with us. Give us a call (678) 932-0200. Happy to chat with you about it. And today we are having another epic closing cocktail with Paul Schaaf. He is our mid year top producer here at the firm in 2023. So congrats on that buddy. Welcome to the show man.

01:01 Paul Schaaf

Hey, thanks a lot, Max. Excited to be here and happy to close another deal.

01:06 Maxwell Baker

Yeah, man. So tell us a little bit about this deal in Arkansas. I know it was a little bit dramatic, but you got it across the finish line and let’s unpack that a little bit how you got there.

01:16 Paul Schaaf

Yeah, for sure. It was definitely a longer deal. It was mainly due to this owner had to redo the entire park. So they took it over when it was poorly run and they had to clean it out and then bring in more homes and just get better tenants in there and a better manager. So took some time to show the cash flow and paint a better picture for the next investor. We also had a lot of park owned homes here and it was during a significant increase interest rates when were running through this deal. So the buyers had to deal with a lot of unknowns with lenders and that kind of hurt us as far as timeline and on price point, but eventually were able to get it over the finish line.

02:14 Maxwell Baker

Nice, man. I know you mentioned it was a longer deal. We had some tough debt placement on there as well. Can you kind of unpack how the debt was structured?

02:23 Paul Schaaf

Yes. So the appraisal was fine on it, but getting that final commitment on some of the local banks in there, they just were cutting off lending MH due to it being predominantly park owned homes. That was one of the hurdles. But thankfully were able to gather better books and records from the owner. Their numbers were improving on a month to month basis. There was room to expand. There was a lot of opportunity for the next investor. It just had to be a motivated buyer. And thankfully were able to identify them. They had just sold, I believe, a farming business and they were excited about getting into the MH and also you could do RV in this park as well. So he put together a good business plan. We connected him with a good mortgage broker who was able to get a decent package aligned for them and at the end of it very satisfied buyer and of course the seller was happy because they were able to move on to some other businesses that they focus on in greater detail.

03:39 Paul Schaaf

So long process but well worth it. That’s really it in a nutshell.

03:44 Maxwell Baker

Yeah it was a tough deal. You all because of the park owned homes and I think you had a little bit of value add, not too crazy amount. It still was a cash flow and asset but the debt placement I think we had to go through like two different lenders. How many lenders did we get through to get this the finish line?

04:03 Paul Schaaf

Quite a few and it know shopped around. That was the biggest hurdle for sure. Max is finding the right lender. Yeah the buyer had to get creative as far as collateralizing some of their assets and showing their experience and background from previous investments and that helped him secure the financing and it’s doing well for him. So everyone is winning in the deal and it was a matter of just persistence on the seller’s half making sure hey, the park continued to show improvement and then the buyer being committed to the deal and just teaming up with everyone to get it done.

04:46 Maxwell Baker

Yeah that was one thing. Having a mobile home park broker team up with you guys out there that are thinking about selling your communities. We’ve got the connections with the lenders, with the mortgage brokers, debt placement guys, ie. Mortgage brokers however you want to call them, potato/potato but also helping build the story around the deal structure. There’s a lot to be said by having an experienced staff behind you when you go to sell your mobile home community and here at the MHP broker that is what you have when you hire us. We are very good at structuring deal stories, structuring debt and making sure you’re getting the highest price when you exclusively list with us. Albeit it did take a little bit to get this one done but hey, we got it across the finish line in a tough economic market with regards to where debt is today.

05:36 Maxwell Baker

So all in all we got it done. Paul killed it, did a great job. Paul, do you have any closing comments here before we sign off?

05:43 Paul Schaaf

No. That was really it. Yeah, I mean, times are changing, but we’re the broker that knows how to evolve and adapt and can make know the seller is taken care of in the right way and then our relationships are still rock solid with our buyers to make sure that, hey, they have meat on the bone and they’re going to be successful after they acquire the park. So that’s what we’re all about, making sure everyone is taken care of and we’re excited to continue in the industry, staying very busy even during these, some call it a turbulent times but it’s actually pretty exciting right now for us. Looking forward to the rest of the year.

06:26 Maxwell Baker

Awesome. Hey, man, thanks for joining us here. Paul, congrats again. As always. You all give us a call at (678) 932-0200. Talk to Paul. He’s there. Ask for him, receptionist will get you over there. Like I said, if you’ve got a park you’re thinking about selling, you should hire us to get you the highest price possible, the best staff behind you, and ultimately help you keep moving forward. Thanks again for listening. Y’all have a good day.

Avatar photo

Maxwell Baker

Maxwell R. Baker founded The MHP Broker in 2009 as a commercial real estate broker specializing in helping Investors buy and sell mobile home communities throughout the Southeast. His family got started with mobile home parks in 2000 where Max gained experience in management, rehabilitation, and selling mobile home parks. Today, The MHP Broker has grown to a team of several agents with expanded services focused on owner and investor brokerage services, mobile home park audits, and in-depth market research, resulting in the sale of over $500 million worth of mobile home communities.