The Shady Grove & Glenbrook Village portfolio consists of 2 mobile home communities located in Hinesville GA which is part of the Savannah metropolitan area.
The portfolio consists of 153 mobile home lots and an office located in Shady Grove. The current occupancy of the portfolio is 96.07%. There is upside available through improving collections and raising rents to the market rate for 2-3 bedroom homes. Their are 18 lot rent only residents paying an average lot rent of $275 across the portfolio. The average park owned home rent is $343 which is significantly below market.
Shady Grove MHP is the largest community and has 81 units. Shady Grove uses public water and sewer that is billed back to tenants based on consumption, using Metron smart meters. Glenbrook Village has 72 MH lots and is on public sewer and has a private professionally monitored well that provides water to the tenants. Residents are billed back $25 a month for the sewer charges.
The portfolio is priced competitively at $6,450,000. The pricing represents a cap rate of 7.25% using lot rent income and billed back utility income (excluding home rent income) on normalized actual’s using a 39.1% expense ratio. The unlevered cash on cash return is 9.77% cap rate. This portfolio qualifies for a non-recourse CMBS loan. Debt quote from Bellwether Enterprise: 3.80% interest rate (real estate only), 3-year interest only, 70% LTV, 30-year amortization, 10-year balloon.
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