Posted by Jeff_AL on October 09, 2003 at 20:41:38:
Thanks for the input. The truth is I have no idea who the party is that is wanting to purchase. Without giving away confidential source, the purchasing party is wanting to buy and replace park with apartments. I will say that my source is someone at the local courthouse where the purchasing party was doing due diligence. I realize that the sale may not come to fruition, but I was just seeking opinions about steps I may take before this becomes public knowledge to minimize my exposure. I have been doing Lease/Options, and like the concept. But, I was wondering if I should sell on note and remain on title as leinholder. Then, if this looks like the sale may indeed happen, I could sell the note. I do know that the owner is open to a sale because he is attempting to do all the work himself.
Posted by Jeff_AL on October 09, 2003 at 16:25:22:
I am pretty new to the MH biz, but I have 4 mobiles in the same park. This is all I have currently. Anyway, I have a very good indicator that the park may be purchased and closed. The park is 250 spaces with about 80 park owned and the rest are either owner, or investor (Lease-Optioned) to the tenants. This includes the four I own. I am currently rehabing one and One is vacant, the other I feel that I will get back within two months. So, three will be three vacant and one occupied. My question is…how can I best protect myself if the park does sell? The information concerning the sale is confidential at this point. I obtained it by keeping my ears open at the courthouse.
I am meeting with someone tommorrow to put them in one of the vacant homes. As you know, there is no financing for the older mobiles, people do not have the cash, so like Lonnie says I sell the financing, or lease/option. I just started doing the Lonnie type deals in May, so the homes I have currently still have about 12K in them. If I have to move them, thats a pile I do not have and that would eat the profit to zilch. So, do I hold out to sell for cash, (not a likely scenario), do I lease option, or do I sell Lonnie style?
By the way, the reason for the interest in the park is because of the location. New four-lane, long range plans call for apartments or office park. The park is in fairly good shape, the owners manage the park, and the husband does most of the maintenance himself. So, if the investors who are looking at the park make a substantial offer, I can see the seller’s motivation. The owner lives in the park and owns 80 of the older homes. One problem is few of the local parks will accept mobiles older than 10 years. Am I stuck?
Re: Park is being purchased - Posted by Joe C. (AR)
Posted by Joe C. (AR) on October 10, 2003 at 03:53:54:
Find another park now. Don’t wait until the news is public. Tie up some spaces somehow. The new owners can, if they wish, evict everyone without too much notice. I saw one give everyone 30 days notice here and there wasn’t much anyone could do.
I know that you don’t want to move your homes, but if the sh*t hits the fan, you will only have 2 choices. Sell them real cheap (nothing), or move them. It won’t do you any good to take a note, your tenants won’t have the money to move them and you’ll get them back anyway. Trying to sell the notes could get you into a legal bind with the note buyer if it happens.
The upside is that there will be plenty of cheap homes if you can find a place to put them. Once word gets out, I would think spaces would be at a premium. Tie them up now with a deposit, if you can. Forfit the deposit if the new buyer lets you stay.
With good parks at premium prices today, it may not be economically feasible for the new owners to close the park or do what you suspect, but you never know.
Do you object to the new owners? Why are you worried about the part being sold? Why are you worried about moving mobiles? It sounds like you are running from the new owners before you even know what it will bring. Mayby they will fix up the place and up your profits. I wouldn’t worry, especially if the sale isn’t even announced yet.