RV Parks For Sale & Financing Loans

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SMALLER PARK SELLS FOR STRONG  VALUE AND BUYER FINDS GOOD CASH FLOW

The mobile home park for sale in the city of Jamul, CA, San Diego County sold on March 19, 2004 for $657,000.  Vince Reynolds and Norman Sangalang of MHRV Advisors represented the Buyer and Seller in this transaction.

The park consists of 17 mobile home spaces and a 1 bedroom, 1 bath house.  The property is situated on 4.68 acres and is serviced by city water and septic system.  There was an additional 3.63 acres that sold with a portion of that land being used for the leach fields.  The mobile home park is located near the fast growing communities of Rancho San Diego and East Chula Vista.  Amenities included a small recreation room and laundry facility.  The park is in a country setting with a large proportion of the park dedicated to green areas and trees. The actual cap rate was 6.4% at the time of sale.

Although mobile home park financing was possible the buyer purchased the park all cash.

Vince Reynolds commented, “Smaller parks in good locations are seeing a dramatic increase in value over the past year.  Increasing rental rates, low vacancies and low cap rates have elevated the value of many of the smaller parks to prices appealing to many more investors.  The reason that it is so important is that conventional financing becomes available under favorable interest rates and terms opening the door to a much broader pool of potential investors.”

Norman Sangalang added, “The park was at 100% occupancy at time of sale with the upside potential in rents.  Six of the tenants have long term leases with increases tied to CPI, the remaining spaces rented from $319 to $345 with comparable spaces in the area beginning at $425.  The sale also included a 3.6ac vacant parcel of land located just north of the property.  A small portion of the vacant land is being used as a leach field for the septic system.  The only thing preventing an explosion of growth in Jamul is the lack of sewer service.  Once a county or city sewer is installed in the area the additional acreage will be a great asset.” 

Reynolds continued, “There were about $18,000 in county mandated repairs and upgrades that were in progress at the time of sale.  The Buyer accepted a price reduction for that amount in order to take possession of the property sooner.  Overall the Seller achieved a strong value for the park without to carry the financing to facilitate the transaction.  Only recently has this type of mutually beneficial scenario become more prevalent with smaller parks.  Values are getting high enough for lenders to offer acceptable, even good,  rates and terms to the buyers and sellers of smaller mobile home parks.”

Mobile Home Park For Sale in CA, San Diego County, Jamul
  

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