A new 250+-space Mobile Home Park (MHP) development in San Marcos, Texas.
Once in a while, all of the many requirements that make for a great real estate investors come together to create an excellent investment opportunity, this is one of those rare events.
Targeted investment averaged annual return 15.9%-19%!
The Project is a new development of a 250+ space, Class “A” All-Ages Mobile Home Park (MHP) in Texas. By developing acreage into a new MHP we are Creating Wealth, wealth that you can participate in.
Park Design: Watch our Video on what a 5-Star Park should look like. 5-Star Mobile Home Park Video The project is funded through entitlement. We are seeking investors for the construction stage.
Park Location: Bryan-College Station, Texas
San Marcos is located in the central part of Texas.
Accredited Investors Only: This opportunity is limited to accredited investors in keeping with the SEC and State Securities regulations. (Regulations D 506-C Offering)
· Located in a high-demand area.
· Investment Timeline 10-years
More Quick Facts
1. The mobile home park size is 250+ -spaces.
2. Break-even should be achieved in 30-36 months.
3. When leased and at full rent rates, the project will have an income of about $2,000,000 per year.
4. When fully leased, annual projected profits are $1,440,000 with an estimated annual Free Cash Flow is at $860,400
5. Investors get a 6% preferred rate, plus 70% percentage of the free cash flow, this should provide an estimated average annual return (including capital gain) of 14% -19.9% of the amount invested.
6. If the project is sold at the end of year five at a 7-8% cap rate, again on the sale would be 120% of the amount invested for the investor.
7. We anticipate holding the investment for 7 to 10-years, then selling the park or refinancing returning the investors their capital with everyone keeping their cash flow.
8. This will be an all-ages land lease community
PowerPoint Download Palace Way MHP Investment PowerPoint Presentation
The Projects Developers: James E. Glasgow & David Joyner, Read More
Development Stages: Development will be in stages of 100 spaces, and then 50-75 spaces at a time.
Timeline: Based on a similar Mobile Home Park that expanded in the last four years that added 278 spaces having leased up in less than 36 months. We estimate a total project timeline of 24-40 months.
Competitive lot rents: Using information from similar parks in San Antonio. Lot rents ranged from $375 a month to $600 a month. The high-end of the scale was for a mobile home rental pad site for a single or double wide home, with an 8’ X 8’ storage shed, two or three parking spaces, in a well-maintained park with amenities.
Projected Lot Rents: Palace Way Lot rents will be $600 a month.
Projected Project Cost: The Park will cost $12,000,000-$13,000,000* to develop, of which 60-70% will be financed. (*Including carrying cost to lease-up).
Projected Completed Project Valuation: The Park’s value when complete and leased up will be. Parks are currently selling at 4% cap rates.
· $21,500,000 at a 6.5% cap rate at lease up.
· $17,500,000 at an 7.7% cap rate at lease up.
Projected Returns: The Mobile Home Park’s
· 24% annualized if sold at a 6.5% cap rate.
· 19.5% annualized if sold at an 8% cap rate.
These are forward-looking statements: A $100,000 equity investment could conceivably grow over ten years to be worth about $430,000 (income received and capital gains combined). Complete details of the project are included in the Business plan, subscription agreement.
Capitalization: All figures are estimates, subject to changes as needed.
Total Project Cost – $13,200,000* (*Including carrying cost to lease-up).
Equity Investment needed: $5,000,000-$6,000,000.
Total Financing: Project Financing needed $8,600,000.
New Home Acquisition/Sales Financing: Additional Park revenue is generated by selling mobile homes and renting space to the buyers.
· What Should a 5-Star park look like Video
A 506(c) publicly advertised offering was undertaken as part of the Form D filing for the mobile home park development offering. This investment is suitable for accredited investors only!
• The securities may be sold only to accredited investors, which for natural persons, are investors who meet certain minimum annual income or net worth thresholds;
• The securities are being offered in reliance on an exemption from the registration requirements of the Securities Act and are not required to comply with specific disclosure requirements that apply to registration under the Securities Act;
• The Commission has not passed upon the merits of or given its approval to the securities, the terms of the offering, or the accuracy or completeness of any offering materials;
• The securities are subject to legal restrictions on transfer and resale and investors should not assume they will be able to resell their securities; and
• Investing in securities involves risk, and investors should be able to bear the loss of their investment.
Market conditions, the high cost of new homes, and changing demographics have created a unique opportunity for the development of new mobile home parks. Well maintained MHP’s located near major metropolitan areas are at or near 100% occupancy.
There is a limited (and declining) number of mobile home parks in the country, cities have not granted very many new MHPs the needed zoning since the 1990s. Plus, the current supply of MHPs is in decline due to developer conversion of existing parks to alternative land uses, and rezoning by some cities that stop the expansion of existing parks, these events have reduced the number of existing parks.
Land Ownership/Rental Structure Makes MHP’s Unique: The Mobile Home Park will own the land/infrastructure and rent lot spaces to tenants who own the homes. In some cases, the park will purchase new Mobile Homes for placement on vacant lots, we will then sell the Mobile Homes with park financed terms or on rent the home short term. This land lease structure gives us:
· Greatly reduced maintenance expenses – Low expense ratio because we rent Mobile Home Spaces (MHS) to homeowners, combined with the new nature of the park
· Low expense ratio compared to other multi-family investments (25%-40% vs. 50%-60% for apartment buildings). The homeowners maintain the house, the park maintains the grounds.
· Additional cash income when the park finances the mobile home buyers.
· Pride of ownership - little to no turn-over of tenants; most tenants stay for many years
· Predictable cash flow from renting the lots to low turnover tenants