This Dallas, GA mobile home park called Town & Country MHP consists of 21 mobile home lots, an office and a single-family house. Dallas, Ga is part of the Atlanta – Sandy Springs – Roswell metropolitan area.
Out of the 21 mobile home lots, 1 is a rent to own tenant with a $300 lot rent and another $300 payment for the RTO with 3 years left on that lease. 19 are rented park owned homes with an average lot rent of $300 and an average home rent of $389.84. There is 1 vacant lot with full infrastructure in place and also an occupied 2 bedroom/2 bath single-family house that rents for $740 a month. The current occupancy of the park is 95.45%. This deal has upside still left in it through raising the lot rents to the market rate, which can support $325-$350. The single-family house is conservatively $200 under the cheapest rental options in the Dallas, GA area for a 2-bedroom, 2 bath house.
Town & Country is serviced by public water that is sub metered and billed back to tenants based on individual monthly consumption. It is also on septic, with a 1:1 ratio. For trash collection, they are billing tenants back $15 per month. Electric and all other utilities are direct bill to the tenants.
The park is priced competitively at $950,000. The pricing represents a cap rate of 7.53% using lot rent income and bill back income (excluding home rent income) on normalized actuals using a 37.2% expense ratio. Using a gross cap rate (including POH income) we are at a 10.99% cap rate. We are asking that investors submit cash offers at or above $950,000. However, this park may qualify for conventional bank financing from a local bank, and seller financing may also be an option. Under the assumption that this is eligible for financing, using a 75% LTV, 5% interest and a 25 year am we are seeing that you will have a 22.9% cash on cash return and a 29.1% total return in your first year of ownership.
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