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PALM TREE MANUFACTURED HOME COMMUNITY MARCH 2018 CONFIDENTIAL EXECUTIVE OFFERING MEMORANDUM TALLAHASSEE, FL 32304 MAXWELL BAKER/404-442-2807/MBAKER@LEEATLANTA.COM
PALM TREEMANUFACTURED HOME COMMUNITY
MARCH 2018
CONFIDENTIAL EXECUTIVE OFFERING MEMORANDUM
TALLAHASSEE, FL 32304
MAXWELL BAKER/404-442-2807/[email protected]
MAXWELL BAKER/404-442-2807/[email protected]
TABLE OF CONTENTSOFFERING OVERVIEW• Welcome Letter
PALM TREEMANUFACTURED HOME COMMUNITY • Executive Summary• Key Considerations• Rent Roll/Inventory• Investment Highlights• Property Description / Infrastructure• Financial Overview• Aerial Map• Demographics• Location Map
ADVISOR BIO
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WELCOME LETTERINVESTMENT OPPORTUNITYWe welcome the opportunity to provide you with our in depth overview of Palm Tree Manufactured Home Community and its position in this current market. We will give you our honest, no holds barred assessment of this 44-unit community so you have a better understanding of how this investment currently performs, its investment potential, and what it takes to get it there.
As leading specialists in the industry, our primary interest is to give you a clear understanding of the driving forces in the current marketplace. Our evaluation is based on verifiable data, market knowledge and proven experience that we feel will serve your best interest at this time.
We invite you to thoroughly review this offering memorandum, If you have further interest, please contact us to discuss any questions you may have, as well as schedule a tour of the property.
GUIDELINES
Offers must be presented in writing and include:
• Price
• Source of capital and relevant experience
• Proposed schedule of due diligence and closing
• Amount of earnest money
• List of contingencies including committee approvals, possible 1031 exchanges, etc.
NOFFERING OVERVIEW | 3MAXWELL BAKER/404-442-2807/[email protected]
PROPERTY ADDRESS: Aenon Church Trail/White Hill LaneTallahassee, FL 32304
PROPERTY TYPE: Manufactured Home Community
TOTAL LOTS: 44
VACANT PADS: 2
LOT RENT ONLY TENANTS: 6
LOT RENT: $250
ACRES: ±9.89
PRICE PER PAD: $29,545
EXECUTIVE SUMMARY
INVESTMENT OPPORTUNITYLee & Associates and The MHP Broker are pleased to offer the sale of Palm Tree Manufactured Home Community, Tallahassee, FL (Tallahassee MSA). This well-situated community, only five minutes from Walmart, is a stabilized investment in a traditionally solid market for the mobile home community industry.
The community has 44 lots with 37 park-owned mobile homes. Lot rent for the community is $250 a month with only two vacant lots within the community. Current occupancy is 95%.
Palm Tree MHC operates on city water (that is not sub-metered) and septic tanks. The 37 park-owned rentals do have some age on them, but are in great condition and remain rented year around with very little, if any, evictions.
The community is being offered at an 8.55% CAP rate on lot rental income only, using a 35.8% expense ratio, plus minimal consideration for the park-owned homes. There is an additional $102,480 in gross income from rental units that is not included in the CAP rate. The seller is only asking $7,040 per home on each of the 37 rental units, which is well below replacement cost.
Seller is looking for cash offers but will finance the opportunity with 50% down and negotiable terms for you to be successful with the opportunity. Bank debt is also available with an estimated term of 20-year amortization, 5.65% interest, and a 30% down payment recourse loan. The overall cash on cash return (park rental income included) is ±28.71%. The price per pad for the opportunity starts at $29,545 per unit that includes full infrastructure for each unit.
We are asking investors to submit offers at or above $1,300,000 for the entire community and park-owned homes. Market lot rents have shown that an owner can raise lot rents to $275 per month and still maintain a competitive advantage over other communities in the area.
PALM TREE MANUFACTURED HOME COMMUNITY | 4MAXWELL BAKER/404-442-2807/[email protected]
KEY INVESTMENT CONSIDERATIONSOPERATING CASH FLOW BEFORE DEBT (LAND) 77,525$ 88,851$ POH RENTS 103,080$ 103,080$ POH EXPENSE @ 40.00% (41,232)$ (41,232)$ TOTAL OTHER INCOME (POHs) 61,848$ 61,848$ NET OPERATING CASH FLOW BEFORE DEBT 139,373$ 150,699$
Interest Rate Amort. Years Down PaymentDEBT SERVICE ON LAND 5.650% 20 30% 60,807$ 60,807$ DEBT SERVICE ON HOMES 0.000% 0 0% -$ -$ TOTAL DEBT SERVICE------------------------------------------------------------------------------------------ 60,807$ 60,807$
CASH FLOW ON LAND----------- Y 16,718$ 28,044$ PRINCIPAL REDUCTION 20,213$ 20,213$
CASH FLOW FROM RENTAL HOME PAYMENTS------------------------------------------- 61,848$ 61,848$ PRINCIPAL REDUCTION -$ -$
TOTAL PRETAX CASH FLOW 78,566$ 89,892$
CAP RATE (NOI/PP) - LOTS ONLY 7.46% 8.55%COCR (CF/DP) LAND + POH NOIs 25.2% 28.83%EXP RATIO (EXP/EGI) 44.0% 35.8%TOTAL RETURN (CF+PRIN / DP) 31.7% 35.3%PRINCIPAL REDUCTION 20,212.98$ 20,212.98$ DCR (NOI/DS) 2.29 2.48PRICE PER PAD 29,545.45$ 29,545.45$
ADVISED PRICING Current Occupancy 95%LOT VALUE 1,039,198$ 8.55% Lot Rent $250POH VALUE 260,500$ 2.5 | $7040 GRM / Per RTOTOTAL VALU 1,299,698$ 36% Expense Ratio
PRO-FORMA VALUE Occupancy 95% OccupiedLOT VALUE 1,130,225$ 8.55% CAP Lot Rent $275
POH VALUE 260,500$ 2.5 | $7040 GRM / Per RTOTOTAL VALUE 1,390,725$ 36% Expense Ratio
PROPERTY NAME:
# Pads: 44 PPP= $29,545.45 Seller BuyerPrice on Land Land Price: $1,039,500 Current YEAR 1Price on Lease Option Notes $260,500Total Price for Opportunity $1,300,000
CURRENT CURRENTBase Rent
Pad Rents 132,000$ 132,000$
GROSS POTENTIAL INCOME (GPI) 132,000$ 132,000$ VACANCY 4.55% (6,000)$ (6,000)$
EFFECTIVE GROSS INCOME (EGI) 126,000$ 126,000$ APPLICATION FEE 1,746$ 1,746$ PET FEE 780$ 780$ SECURTIY DEPOSIT 9,865$ 9,865$
GROSS OPERATING INCOME 138,391$ 138,391$ EXPENSES:
Dumpster 111.74$ 4,917$ 4,917$ Eviction Cost 50.05$ 2,202$ 2,202$
Insurance Expense Liability 44.59$ 1,962$ 1,962$ Landscaping and Groundskeeping 43.46$ 1,912$ 1,912$
Maintenance 577.82$ 25,424$ 5,000$ Management 107.75$ 4,741$ 13,839$ Permit Fees 4.55$ 200$ 200$
Property Taxes 140.02$ 6,161$ 6,161$ Utilities 26.47$ 1,165$ 1,165$ Water 276.86$ 12,182$ 12,182$
Per PadTOTAL EXPENSES 35.8% $1,383.31 60,866$ 49,540$
NOI--------------------------------------------------------------------------------------------- 77,525$ 88,851$
Palm Tree MHC - Tallahassee, FL 32304
INCOME & EXPENSE REPORT (LOT RENT ONLY)
PALM TREE MANUFACTURED HOME COMMUNITY | 5MAXWELL BAKER/404-442-2807/[email protected]
RENT ROLL/INVENTORYUnit # Name MH Rent Lot Rent Year Mfg Manufacturer Size (W x L) BR/Baths Single/Double WideAenon Church Trail5601 AC Adam/Tammy Hughes 200$ 250$ 1971 Broa 60'5609 AC Betty Price - 250$ Tenant Owned5614 AC Park Worker 50$ 5619 AC - 250$ Tenant Owned5624 AC Steve AC man (Worker) 50$ 5629 AC 200$ 250$ 1971 Bari 56'5636 AC Vacant Lot5641 AC Trystin Phillips 250$ 250$ N/A N/A N/A5646 AC Tresh Griffin 150$ 250$ 1972 Cara 56'5651 AC - 250$ Tenant Owned5656 AC Vacant Lot5660 AC Mark Schofield/ Scott Garner 250$ 250$ N/A N/A N/A5666 AC Cody Stotz 250$ 250$ 1971 Rmbe 46'5672 AC Vacant Lot5678 AC Lisa 200$ 250$ 1972 Chmp 56'5682 AC Debra Atkins - 250$ Tenant Owned5686 AC John Garrett 200$ 250$ 1969 Wnstn 52'5692 AC - 250$ Tenant Owned5702 AC Carlos Altrado 100$ 250$ 1965 Vali 39'5707 AC Teresa 325$ 250$ 1991 Dest 40' DW5713 AC Stuart 300$ 250$ 1981 Guar 56'5718 AC Edward & Corey Rodgers 300$ 250$ 1988 West 66'5720 AC Jim Drew & Ashton Chisholm 200$ 250$ 1968 West 60'5723 AC JOE 325$ 250$ 1979 Fern 56' DW5728 AC Skylar Smith 250$ 250$ 1969 Chmp 56'5730 AC Matt 300$ 250$ 1974 Craf 49' DW5731 AC Jeffrey OLD unit 220$ 250$ 1965 Pace 61'5734 AC Jose & Kelly Rozalos 200$ 250$ 1997 Dest 52'5737 AC Joyce Dodson 250$ 250$ 1968 Grge 50'5742 AC Chelsa Young 220$ 250$ 1969 Rmbr 46'5746 AC Alberto 200$ 250$ 1962 Remb 56'5749 AC Bobby Mitchell 200$ 250$ 1970 Cart 56'5752 AC Jesse Crews - 320$ Tenant Owned
PALM TREE MANUFACTURED HOME COMMUNITY | 6MAXWELL BAKER/404-442-2807/[email protected]
RENT ROLL/INVENTORYUnit # Name MH Rent Lot Rent Year Mfg Manufacturer Size (W x L) BR/Baths Single/Double WideWhite Hill Lane5750 WH Elizabeth Raspperry 220$ 250$ 1969 Conc 61'5751 WH Jeffrey (dogs) 175$ 250$ 1973 Rivr 61'5754 WH 100$ 250$ 1960 Nobi 56'5755 WH Anthony Bonello 300$ 250$ 1977 Cncr 61'5758 WH Robert Hunter 250$ 250$ 1976 Cham 56'5759 WH 325$ 250$ 1988 Flee 52' DW5762 WH Jack Aguilar 250$ 250$ 1984 Rive 61'5763 WH Mauricio & Susan 250$ 250$ 1988 Libe 48'5766 WH 100$ 250$ 1985 Clas 48'5767 WH 225$ 250$ 1994 Dest 72'5770 WH Vacant Home 400$ 250$ 1998 Spri 24' X 56' DW5771 WH Michael Lawskiny 250$ 250$ 1988 East 56'5774 WH 200$ 250$ 1988 Oaks 44' DW5775 WH Amanda Wolters 355$ 250$ 1989 Chap 40' DW
PALM TREE MANUFACTURED HOME COMMUNITY | 7MAXWELL BAKER/404-442-2807/[email protected]
INVESTMENT HIGHLIGHTS
• Stabilized Park with Motivated Seller• Tallahassee MSA• 8.55% CAP on Lot Rent with 35.8% Expense Ratio• City Water / Septic Tanks• Owner Financing• Booming Market with Upside in Lot Rents• Five Minutes from Walmart• Stable Tenant Basis• Price Per Lot = $29,545
• Shared septic tanks on some lots
• Homes are older and may need some renovations
• Park could use some landscaping improvements
• Mom and Pop operator; records are limited
KNOWN ISSUES
PALM TREE MANUFACTURED HOME COMMUNITY | 8MAXWELL BAKER/404-442-2807/[email protected]
THE OFFERING
PROPERTY ADDRESS: Aenon Church Trail/White Hill LaneTallahassee, FL 32304
COUNTY: Leon
PARCEL NUMBERS: 2130206280000, 213026310000,2130206040000, 213020642000
SITE DESCRIPTION
# OF PADS: 44 units
TOTAL LAND AREA: ± 9.89 acres
CURRENT OCCUPANCY: 95%
ZONING: R-5
MECHANICAL
WATER: City water and septic
ELECTRIC: 100 / 200 AMP
PROPERTY DESCRIPTION
Tallahassee, Florida’s capital city, shares a deep-rooted history and culture with both laid back outdoor adventures and an upbeat vitality. The area’s rolling hills, four distinct seasons yet temperate climate, and picturesque canopy roads, along with its concerts, live performances, festivals and parades ,makes the heart of the Florida Panhandle a perfect mix of cosmopolitan flair and hospitable charm. Government is the central focus of Tallahassee’s economy, although education, printing and publishing, food processing, and the lumber industry play important roles as well. Tallahassee enjoys a stable economy and a comparatively low unemployment rate. The Tallahassee-Leon County area has shown consistent growth across several indicators over the last year in real estate development and in the local economy.
Tallahassee is a high technology center and is sometimes referred to as “Silicon Valley South.” Institutions such as Innovation Park/Tallahassee, affiliated with Florida A&M University and Florida State University, and Smart Park, a privately owned 130-acre fiber-optic research center, place Tallahassee on the cutting edge of technology. The city boasts that it is the most wired community in the country.
INFRASTRUCTURE Palm Tree MHCNumber of MHP Spaces 44Number of RV Spaces 0
Number of Park‐Owned 37Vacant Pads 2
Number of RTO Contracts 0Single‐Wide Homes 7
Double‐Wide Homes 30Number of Lot Renters 5
Homes Used for Storage 0
Road Type PavedFlood Plane NoTopography Flat
PALM TREE MANUFACTURED HOME COMMUNITY | 9MAXWELL BAKER/404-442-2807/[email protected]
LOT RENT: $250
PARK-OWNED HOMES: 4
TOTAL PRICE: $1,300,000
DOWN PAYMENT: 30% / $390,000
TOTAL PADS: 44 units
PRICE PER PAD: $29,545
PARCEL SIZE: ± 9.89 acres
FINANCIAL OVERVIEW
PALM TREE MANUFACTURED HOME COMMUNITY | 10MAXWELL BAKER/404-442-2807/[email protected]
DEMOGRAPHICS1 MILE 3 MILES 5 MILES
POPULATION
2022 PROJECTION 2,384 33,601 99,519
2017 ESTIMATE 2,214 32,527 96,618
2010 CENSUS POPULATION 1,889 30,132 94,583
HOUSEHOLDS
2022 HH PROJECTION 1,035 14,886 43,417
2017 HH ESTIMATE 944 14,135 41,200
2010 HH CENSUS 775 12,377 36,831
2017 ESTIMATED POPULATION BY RACE
WHITE 58.0% 51.6% 51.8%
BLACK OR AFRICAN AMERICAN 26.4% 39.5% 39.8%
OTHER 15.6% 8.9% 8.4%
INCOME
2017 ESTIMATED AVERAGE HH INCOME $46,771 $37,244 $40,298
2017 ESTIMATED MEDIAN HH INCOME $36,796 $33,471 $36,760
2017 ESTIMATED PER CAPITA INCOME $19,941 $16,415 $17,421
AGE
MEDIAN AGE 44.0 43.6 44.4
PALM TREE MANUFACTURED HOME COMMUNITY | 12MAXWELL BAKER/404-442-2807/[email protected]
LOCATION, SCHOOLS, WALMART & MHP SUPPLY
PALM TREE MANUFACTURED HOME COMMUNITY | 13MAXWELL BAKER/404-442-2807/[email protected]
Maxwell R. Baker joined Lee & Associates in 2014 as a commercial real estate broker specializing in purchasing and sellingmobile home communities in the Southeast. His family has been involved with mobile home parks for more than 15 years,and he has been a part of management, rehabilitation, and disposing mobile home parks since his family purchased theirfirst park. Max is also Founder and President of The MHP Broker offering mobile home park owners and investors brokerageservices, free mobile home park analyses, in-depth market research, and mobile home park financing consultation.
In 2014 and 2015, Max completed approximately 80% of all Georgia manufactured home community transactions andhas also closed transactions in other Southeast states including Tennessee, Alabama, North Carolina, South Carolinaand Florida. Max's core competencies include structuring and negotiating complicated transactions, owner financing,research and outsourcing, and his "deal-making" capabilities.
Max, along with his expert team of researchers, compile and maintain the industryÕs most comprehensive database ofmobile home community data in the Southeast. Max and The MHP Broker are recognized as a trusted advisor in this rapidlygrowing multifamily, affordable housing sector.
¥ Georgia State University - B.A. Real Estate¥ United States Marine Corps
¥ Atlanta Commercial Board of Realtors¥ Real Estate Broker - Georgia¥ Georgia Manufactured Housing Association (GMHA) member¥ Southeast Community Owners (SECO) member
Biography
Education
Memberships & Associations
3500 Lenox RoadSuite 200Atlanta, GA 30326
Partial Client ListBeal BankColony CapitalMarket Street CapitalAffordable Housing Communities Inc. Capital Square Holdings LLCThe Reach GroupMidland Loan ServicesHartman Wright Group, LLC Affordable Communities Group, LLC
PrincipalMAXWELL BAKER
ADVISOR BIO // MOBILE HOME PARKS
ADVISOR BIO - MAXWELL BAKER
ADVISOR BIO| 14MAXWELL BAKER/404-442-2807/[email protected]
The information contained in this Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Lee & Associates and should not be made available to any other person or entity without the written consent of Lee & Associates. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Lee & Associates has not made any investigation, and makes no warranty or representation, with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCB’s or asbestos, the compliance with State and Federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property. The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable; however, Lee & Associates has not verified, and will not verify, any of the information contained herein, nor has Lee & Associates conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein.
NON-ENDORSEMENT NOTICELee & Associates is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation’s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Lee & Associates, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Lee & Associates, and is solely included for the purpose of providing tenant lessee information.
ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONTACT THE LEE & ASSOCIATES AGENT FOR MORE DETAILS.
EXCLUSIVELY LISTEDBIRMINAAL
MAXWELL BAKER / PRINCIPALPHONE: 404.442.2807 | [email protected] & ASSOCIATES | ATLANTA 3500 LENOX ROAD, SUITE 200 | ATLANTA, GA 30326
