Mobile Home Park Management
The key to success in any real estate investment is management. Mobile Home Parks are no different. But they do raise some unique challenges of their own, which are often beyond the scope of most property management companies.  CCI Real Estate has been managing Mobile Home Parks for themselves for many years. This gradually worked into providing similar services to our clients who had purchased Mobile Home Parks through us. Then in 2005, we officially established CCI Property Management specifically to provide this specialized Mobile Home Park Management to our clients, who purchased those parks from us. It’s grown considerably since then. We presently manage over 37 Mobile Home Parks for our clients and ourselves, nationwide. We found that by managing them ourselves, we could not only relieve our clients of the burdens and stress of Property Management, but also run their properties better and keep better books, which in and of itself can increase the property’s value.  That’s part of what we call “VALUE ENHANCEMENT”. Value Enhancement goes beyond traditional Property Management, actually improving and developing the property in ways that increase it’s Net Operating Income (NOI). Since Commercial Real Estate value is tied directly to NOI, when the NOI goes up, the value of the property goes up as well. A general rule-of-thumb is that for every $100 per month you can increase the NOI, the property value increases by $10,000! Yes, you read that right. $100 equals $10,000! Here’s how it works: |
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EXAMPLE: |
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You will note the 12% Cap Rate. That’s a very high Cap Rate (good for the buyer/investor) in some parts of the country, and probably higher than most buyers will get, even in today’s market. We used this high rate to illustrate the point that even when pricing the property aggressively enough to offer the buyer a 12% Cap Rate, the property still increases by $10,000 in value. Price it more in line with an 8% to 10% Cap Rate and the Property Value will Increase by $12,000 to $15,000 for every $100/month increase in NOI. These are all projections and estimates, of course. Actual figures will vary on every property. So, how does one go about increasing the NOI of a Mobile Home Park? It can be accomplished either by increasing Income by $100, or by reducing expenses by $100, or some combination of both. A penny saved really is a penny earned, because it doesn’t matter which side you get it from, it’s more money in the property owners’ pocket either way. Expert Property Management of your Mobile Home Park is crucial in getting every last dollar out, without letting the park or the tenants suffer, and in fact, actually making the park better. Whether you want to sell your Mobile Home Park someday at a profit (as many of our clients do, check our PAST SALES page for more details), or hold on to it long-term for the great Positive Cash Flow, you want your park to make the maximum Net Profit possible. Some of our clients choose to manage their properties themselves, in which case we always make ourselves available to them with answers to their questions, or help if they need it. Some choose our full service Property Management, and some choose parts of it, and do other parts of it themselves. It’s entirely up to the property owner to decide how much or how little they want us to help. |
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CCI Property Management’s full service approach to managing your Mobile Home Park includes:
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Just running a Mobile Home Park the right way, and doing the above things properly, will go a long way toward making it more profitable and hence more valuable. However, we go well past that. VALUE ENHANCEMENT is part of the service we provide, if the property owner wants it. It usually doesn’t cost any more than the normal management charges. Of course, the improvements themselves need to be paid for by the property owner, but all such expenses are approved in advance, in writing by the property owner before any commitments are made. Value Enhancement can include, but is not limited to:
Our Property Management charges vary, depending upon the park, the size and scope of the job, and the services we are providing. But in general, our clients pay a flat monthly fee that is well below the 5% to 10% (of gross rents) that most Property Managers charge. Why do we do it? First off, we only offer this service to our real estate clients, and generally only on Mobile Home Parks they purchase through us (there are exceptions, of course). We do all this because we want our clients to be successful and happy with the properties they buy from us. We want it to be a clean, hassle-free experience for them, so that they will want to buy more parks from us. And we want them to make great money on them so that they can afford to buy more. Lastly, by running them right, keeping good records, and applying the Value Enhancements that we do, we not only increase the value, we make them more attractive to a buyer and thus easier to sell, and assures us that we will have excellent financial records to show buyers, since we’re the ones managing the park. A well run park with good books will always be easier to sell and worth more than a comparable park that is poorly run and has lousy records. We currently manager over 37 Mobile Home Parks for ourselves (yes, we own Mobile Home Parks ourselves) and our clients, both in California and out-of-state. Our main office is located in Oakdale CA with a branch office in Columbus MS. If you would like to know more about our Property Management services, “Value Enhancement”, or you’re interested in buying or selling a Mobile Home Park, please call us any time at (209) 845-3860. NOTE: While we own MHPs ourselves, we never step in front of a client. In other words, we don’t cream the best for ourselves. We put our clients first, but it no one else moves on a certain property, we often purchase them ourselves, rather than let a good deal go. |
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