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BUYER SEES UPSIDE FROM VACANT SPACES IN BOOMING MARKETRAILER PARKLACE

The mobile home parks for sale in the city of Yucaipa, CA, San Bernardino County sold on October 31, 2005 for $2,900,000.  Vince Reynolds and Norman Sangalang of MHRV Advisors represented the Seller in this transaction.

The park consists of 107 mobile home spaces and a 2 bedroom SFR (108 total units).  There are two parks being sold together. The property is situated on 10.5 acres and is serviced by city water and city sewer. The mobile home parks are adjacent to each other and essentially operated as one property. Amenities at the park include a laundry facility, pool and clubhouse. The park is subject to the City of Yucaipa rent control allowing for an increase of 80% of the CPI published by the Bureau of Labor Statistics for the Los Angeles-Anaheim-Riverside Metropolitan Area.  This CPI index has increased by an average of 2.8% over the past five years($6 to $7 increase per year).  Average space rents were between $245-$265.  All the utilities are sub-metered or passed thru to the tenants.   The park had 22 combined vacancies at the time of the sale

Although mobile home park financing was possible for this park the buyers purchased the park all cash.

Sangalang commented, “Yucaipa's rent control ordinance made this property a difficult sale,  we had several investors interested in the parks and the opportunity to fill vacant spaces but, most would shy away once they became educated with Yucaipa's onerous rent control ordinance.  In this transaction the buyer had recently purchased two other parks in Yucaipa, is already familiar with the ordinance and knows he can fill the vacant spaces and substantially increase cash flow.”

“Yucaipa is really going through a major revitalization right now so the ability to fill the remaining vacant spaces in a short time frame is very realistic. The Chapman Ranch subdivision will add 2000 new homes when finished.  That translates to many new jobs, businesses and an increased workforce that need affordable housing.  The seller was able to fill approximately 20 spaces in the last 12 months through very modest efforts.  In addition, the over all, below market rent structure will help to keep the parks full for the long term.” said Reynolds

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