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Interview with Alex Donnolo of Mavdon Investments

Listen on Apple Podcast here: https://podcasts.apple.com/us/podcast/interview-with-alex-donnolo-of-mavdon-investments/id1520681893?i=1000640349415

SHOW NOTES

Welcome back to the Passive Mobile Home Park Investing Podcast, hosted by Andrew Keel. On this episode of the Passive Mobile Home Park Investing Podcast, Andrew reconnects with a previous guest on the show, Alex Donnolo of Mavdon Investments. 

Alex Donnolo is the founder of Mavdon Investments, founded in 2019 and owns a $15 million portfolio of commercial real estate totaling over 600 units with a specialty in mobile home parks and RV parks.

In this episode, Andrew and Alex discuss Alex’s unique strategies for investing in real estate, his in house property management team and how he acquires mobile home park investments. They also talk about infill, the benefits of tenant owned homes versus park owned homes and the metrics Alex uses when investing in a mobile home park.  

With his background in commercial real estate and his keen eye for a good mobile home park investing deal, Alex shares with listeners why he feels smaller is sometimes better.

Andrew Keel is the owner of Keel Team, LLC, a Top 100 Owner of Manufactured Housing Communities with over 2,500 lots under management. His team currently manages over 40 manufactured housing communities across more than 10 states. His expertise is in turning around under-managed manufactured housing communities by utilizing proven systems to maximize the occupancy while reducing operating costs. He specializes in bringing in homes to fill vacant lots, implementing utility bill back programs, and improving overall management and operating efficiencies, all of which significantly boost the asset value and net operating income of the communities. Check out KeelTeam.com to learn more. 

Andrew has been featured on some of the Top Podcasts in the manufactured housing space, click here to listen to his most recent interviews:  https://www.keelteam.com/podcast-links. In order to successfully implement his management strategy, Andrew’s team usually moves on location during the first several months of ownership. Find out more about Andrew’s story at AndrewKeel.com.

Are you getting value out of this show? If so, please head over to iTunes and leave the show a quick five-star review. I have a goal of hitting over 500 total 5-star reviews, and it would mean the absolute world to me if you could help contribute to that. Thanks ahead of time for making my day with your five-star review of the show.

Would you like to see mobile home park projects in progress? If so, follow us on Instagram: @passivemhpinvesting for photos and awesome videos from our recent mobile home park acquisitions.

Talking Points:

01:00 – Alex Donnolo’s background and journey into mobile home park and RV park investing

05:55 – Keeping everything as simple as possible

12:20 – Buying smaller mobile home park investments

19:25 – Properly inspecting mobile home park utilities

21:07 – How to replenish capital

22:45 – Mobile home park investors, taxes, and due diligence

27:18 – Alex’s perfect mobile home park

31:07 – Aging mobile homes and “grandfathered-in” mobile home parks

33:19 – Reaching out to Alex Donnolo

33:38 – Conclusion

SUBSCRIBE TO PASSIVE MOBILE HOME PARK INVESTING PODCAST YOUTUBE CHANNEL https://www.youtube.com/channel/UCy9uI3KGQmFgABsr9lUtRTQ

Links & Mentions from This Episode:

Alex’s website: https://www.alexdonnolo.com/

Alex’s instagram: https://www.instagram.com/alexdonnolo

Keel Team’s official website: https://www.keelteam.com/  

Andrew Keel’s official website: https://www.andrewkeel.com/  

Andrew Keel LinkedIn: https://www.linkedin.com/in/andrewkeel  

Andrew Keel Facebook page: https://www.facebook.com/PassiveMHPinvestingPodcast 

Andrew Keel Instagram page: https://www.instagram.com/passivemhpinvesting/ 

Twitter: @MHPinvestors


TRANSCRIPT

Welcome to the Passive Mobile Home Park Investing podcast. With your host, Andrew Keel. This is the podcast where you can get the education you need to invest 100% passively in a highly profitable niche of mobile home parks.

Andrew: Welcome to the Passive Mobile Home Park Investing podcast. This is your host, Andrew Keel. Today, we have an amazing guest with us in Mr. Alex Donnolo from Mavdon Investments.

Before we get started, I want to ask you a real quick favor. If you’re getting any value out of this podcast, would you please go over to iTunes and leave me a review? It means the absolute world to me. I promise I’ll keep recording if you keep posting reviews. Thank you so much for those reviews of the show. All right, let’s dive in.

Alex is the founder of Mavdon Investments founded in 2019. He has a $15 million portfolio of commercial real estate totaling over 600 units with a specialty in mobile home parks and RV parks. Welcome to the show, Alex.

Alex: Yeah, glad to be here. Glad to be back. Thanks for having me.

Andrew: I was just looking at our previous episode earlier today. It’s been two and a half years since you’ve been on. I know a lot has changed, but maybe you can start out by just telling us a little bit about your story, reminding us how you got into manufactured housing communities, and then maybe tailing that with what’s changed in the last two and a half years since we interviewed you and Dylan.

Alex: Yeah, I would say, mainly just more tattoos, but no. We’ll start with your first question. Just a quick run through on my trajectory and how I got in the space. I started construction. That was my first dabble in business, not being an entrepreneur right out of high school, started my construction company, and just was self-taught. I had some mentors in the space but was self-taught, a lot of YouTube.

Through that, I was practicing sales, negotiation, how to run a business, and grow teams, but I was still trading time for money. Eventually, I started flipping houses except I was bootstrapping every project, doing the work, funding it. Again, I was trading time for money. I was like, oh, there’s got to be a better way.

By my early 20s, I started hearing about wholesaling online, watching videos, and studying. I jumped into that and got really gung ho about it. I started doing deals all over the US, and that’s how I met Dylan. We were going to expos and stuff. We met at an expo, and we both have big visions. We were both young and driven.

We complement each other really well. Dylan was very detail oriented and operational. He was good at growing and managing teams, I was vision-driven. I’ll go get investors, and I’ll build a big vision. We started moving pretty quickly. We did over a million in wholesale fees together pretty quickly in about a year, year and a half.

As the story goes, we bought our first mobile home park in 2019 and never turned back. We started buying up the whole block of mobile home parks. Just really trial by fire, we learned so much. We were physically flying out there. This was in the Midwest. Us living in the Pacific Northwest, we were going out and personally interviewing site managers, knocking on doors, and serving notices. It was great, because that first deal is always exciting. You have a much more intimate relationship.

We got really in the trenches style crash course, learned a lot, and then started putting content out there. That’s really how we gained attention from passive investors. It was really a lot of inner network stuff. That got us probably our first three or four deals, and then after that it was just through Facebook, coming on these podcasts, and sharing our stories.

Dylan and I still get along great since the transition. Actually, I’m possibly buying a wholesale deal from him right now. It was just, I wouldn’t even say creative differences, but just different goals. We had different goals and what our personal lifestyle goals were. That created different business goals, and it just made sense to dissect things. We still champion each other, we still do deals together.

For me personally, as far as where I’m at now, after going out on my own, I’m very creative. I’m a visionary. My mind is always going. I had to build back up my team, get back into acquisition mode, and buy mobile home parks, but I also venture off and get these itches to buy lifestyle type projects, Airbnbs, and RV parks.

Like I mentioned to you before we started recording, every time I do that and I run the numbers, I do underwriting, and I try and determine an exit strategy, I’m just like, man, this is why we’re in the mobile home park industry. It’s just a testament to that. It’s fun to do these other projects with maybe more sexy asset classes but tons of turnover and more questionable horizons.

In 2024, we’re up, like you said, up above 600 lots again, and we want to double that strategically. We’ve tightened up our criteria a little bit. It was anything and everything before. I think Dylan has mentioned, it was a wastewater treatment plan, we’ll take it, anything. Let’s learn, let’s get some deals on our belt now. Okay, let’s refine that criteria and be a little more specific. I’m not very market specific. I still buy anywhere, just more deals specific now.

Andrew: Maybe tell us about that. What does your mobile home park investing strategy look like now compared back in 2019 when you bought that first deal?

Alex: The biggest thing is, I really like to keep it as simple as possible. You can call it a needle-in-a-haystack deal or whatever you want, but I tend to find them. I like high occupancy. I have not mastered the infill game, and I will admit that wholeheartedly. It’s just not my cup of tea to be dealing with all that.

As time goes on, and I have executives running in the leasing department and stuff, then we’ll look more into that. Of course, we will always have marketing out there, and we’re always doing infill. In certain areas, it’s a lot easier to have people move their own homes. In Texas, people just show up with their mobile home, but hey, I’m here. Where’s the site?

We’re not buying, renovating homes, and doing all that. I like 60% occupancy, that’s a new metric. For that same reason, I used to be bullish on park-owned home conversions. I don’t care how many park-owned homes there are. We can convert them to tenant-owned homes, and that’s just gotten more difficult over time, I feel like. It’s tough, but right now, we’re saying no more than five park-owned homes. Obviously, we flex on that a little bit, but it’s just a criteria that…

Andrew: I think that’s something in the last few years that a lot of operators got lenient with. But from my experience, when you buy a park with a lot of park-owned homes, and maybe you can shed some light on this as well, there’s turnover. Some people don’t want to own a mobile home, they just want to rent. So you’re going to have turnover. These homes don’t come back to you in crystal clean condition.

We bought a park, 136 lots, all park-owned homes. The turnover has been, I’d say probably a third of the tenants over the course of a year now are turning over, and we’re getting the homes back. You gotta have a lot of crews to get these things rent-ready and then sell them.

In some markets like Midwestern markets, the absorption rate, you’re not going to be able to sell 20 homes a month in certain markets without getting bad eggs in there. It’s been tough, and one thing that we’ve gotten a little bit more specific on is less park-owned homes as well. But I’m curious of your experiences.

Alex: Yeah, same thing because it’s easy to say, well, no park-owned homes because of the maintenance and all that, but the turnover is the biggest benefit for me of the tenant-owned homes. Those tenants stay forever. Mascoutah is a prime example of the first park we bought. There were 22 tenants, and we only had one park-owned home. That one park-owned home to this day caused more problems than any other of our parks.

We’ve had 20 different tenants in that home. It’s been remodeled countless times. That was a prime example, and then we still kept buying park-owned homes. We have one park in Toledo. Dylan took that over in the transition. I would say it’s about 50% park-owned homes. We missed the mark by probably a year on that one, just how long it was going to take to convert those, and what the responsiveness was going to be from those tenants.

That’s the one thing. You’re banking entirely on speculation as to how they’re going to react when you try and get them to buy the home or even give away the home, because most of the time they’re not in great condition to begin with, or they’re older homes. Then you’re buying older homes and you’re opening it up.

That park specifically in Toledo, we were doing electrical work. We had to redo all the electrical, the plumbing. At that point, it’s just diminishing returns all the way around. I know guys who if they have great systems in place, then they’ve got ways to make that a very lucrative part of the business, especially infill, converting vacant lots, doing infill, adding values. It’s great, it’s just not my cup of tea right now.

Andrew: Yeah. We do a lot of infill, but there’s no secret sauce or anything. It’s a lot of work. It’s a lot of project management. We have four full time project managers and that’s all they do on new projects. Their whole job is to find homes, get them brought in, get concrete work,  and get utilities hooked up. It’s just a ton of work and it’s expensive.

You can’t outsource that. These have to be US based people that are going to spend a week out of the month on site meeting with these contractors and making sure that it’s done right. It’s a lot of work. I applaud you for realizing, hey, this is outside of my lane, this is where I’m at, this is what I’m good at. And hey, an infill home here or there is great, but big, huge 20-plus home infill projects is opportunity cost. If you can buy something else over here, and it’s just lower hanging fruit, easier to turn and burn than buying something that’s a big project, then it’s just going to require 60%-70% of your time. It could be more profitable.

Alex: That’s exactly what I’ll say just to touch on that. It makes for easier conversations with my cash providers, with my lenders, investors because in the past, it’s like, okay, well, here’s the projections, here’s a business plan. Okay, by this quarter, we’re going to ideally convert this many park-owned homes, and then quarterly reports come out.

Everything else, we hit all our other financials and everything, but those park-owned homes are that one thing. It’s like, oh, we’re missing that target. Why not just make sure that in the worst case scenario, if I do everything as is and count infill as a cherry on top or anything new, like I said, as a cherry on top, and the deal still crunches, and we still meet our cash on cash return, then great. That’s a great deal. I know that we can push to increase that occupancy, and that’s going to make it even a better exit strategy kind of deal. But I just don’t have to bank on that speculation.

Andrew: Yeah. I know, you buy a lot of smaller parks or you have in the past. Tell us about that and how you get that to work in some of these tertiary Midwestern markets.

Alex: Yeah, 100%. To be honest, the reasoning for that is I’d love to be buying bigger parks. I do like the easy due diligence. For me, it’s easier to take a small development or acquisition fee, like a $25,000 acquisition fee, and do four deals a month or three deals a month kind of deal. I’ve been trying to think everything on one big project or. With my team size, as we’re scaling our team right now, it’s a lot easier. I like to be a lot more thorough these days on due diligence. I don’t want to miss anything.

The second reason is, I have a unique funding strategy. I’m not doing syndications or funds, I do all seller financing. My cash providers come in as second or third position private lenders, and I’ve been able to do that just by working with a lot of newer investors, people who see my track record, newer lenders. I have to explain to them the nuances of the tax differences of being a lender versus an investor.

Andrew: Maybe you can go with that.

Alex: Yeah, absolutely.

Andrew: The second and third position liens on the real estate, is that their collateral? Your cash providers, your equity providers, are second or third position liens on the property, on the real estate itself like recorded positions?

Alex: Yeah. The way that I incentivize them to do that is with really high interest, typically 15%. That’s just fixed 15% annualized interest and then monthly installments. There’s no equity. Sometimes as you get into the more sophisticated investors and the higher check writers, the higher earners, they need those tax benefits. In those situations, still, I’ll only work with maybe one cash provider and we’ll just do a partnership. They will get roles and responsibilities within the operating agreement.

They will get their equity, but I don’t do any hurdles or anything like that. I still set them up with a fixed interest, because really at the end of the day, what they want to know is, we’re all in this for stability. We’re in the space for stability, so remove speculation from the equation. As I get into bigger deals, the reality is it would just make that model a little more complex. This has worked for me, and then just buying more deals kind of deals and tightening the criteria.

Andrew: I totally get it. I think the biggest misnomer about small parks is that they’re harder to manage. I think that’s 100% dependent upon the onsite manager that you can find. If you can find a great onsite manager, you can make a small park work every day of the week.

I’m under contract right now to buy two small ones, one 30 lots and one 32 lots. They’re near or in the vicinity of some other bigger parks that we own, but I’m going in at 11 caps. These are 11 gaps, day one, current occupancy, current income. It’s like, okay, I can make this work. I can pay my onsite managers a little bit more and still make this deal work. I do think that there’s a niche there. It probably will be a little bit tougher to manage in terms of the management income that you’re getting in the property management company.

Alex: Like you said, the exit strategy is like, all right, you’re in a bit of a smaller market. One thing I will say is, like you said, oftentimes these are more mom and pop, there’s more meat on the bone. We’re still doubling the value of these. We’ve hit our exits on these, and sometimes we just need to sell. Rather than refinance, we sell.

A lot of times, even on our refi products with these smaller parks, we’re working with local banks. We can still get solid terms from local banks, or we can just sell. It works if you’re buying four small deals to sell two of them and refinance two of them.

We’re always being very proactive about our exit strategy, and just making sure we drive value out the gate as quickly as possible. Like you said, especially when you’re buying in various markets, it boils down to the systems you have in place for your management team.

Andrew: Totally. Alex, tell us about your most recent mobile home park acquisition, when that was, what did it look like, and so forth.

Alex: October was the recent mobile home park, 35 pads, about 800,000 seller finance. I can’t think of the exact terms off my head, but it was good at 5% interest only and three years seller finance. It’s in a tornado zone. It’s in Lubbock, Texas. That was my first deal buying in a tornado zone. I worked with one cash provider on that deal. We both are bullish on Texas. Everything about this park made sense, fully occupied, 35 lots fully occupied. very undervalued lot rents.

Andrew: City water, city sewer?

Alex: All city utilities, 180 on the lot rents. Market realistically is 275-300. We’re going in. They’ve just been deprived of management, deprived of groundskeeping. We’re going in and doing a six-month push. That’s our typical protocol, do a six-month push to improve management, improve the systems, fix the potholes, attend to the needs of the tenants, and then start getting out notices for the rent raise plan.

We’ve already given out our first notice, and there’s been good responsiveness to that. It was one of those things, where we just did a lot of research. When was the last tornado? What is the risk factor here? Looking into the insurance.

Andrew: How did you find that deal?

Alex: That was through a wholesaler. Right now, we’re not doing any cold calling. I’m starting to build a cold calling team again, but I’ve been pretty lazy. Right now, I’m on all the email lists. It’s so easy to just pick up wholesale deals and work with those guys. I get pocket listings from brokers. This was a wholesaler that I work with quite a bit who sent me this.

Andrew: Nice. We talked about park-owned homes earlier, but what other mistakes that you’ve made in mobile home park investing you think we could learn from?

Alex: Yeah, great question. I think Dylan’s touched on before but just not properly inspecting utilities. That’s such a big one, understanding that, and not getting multiple quotes. We work in various markets. We subcontract out pretty much everything.

A lot of times, it’s a rush to get due diligence to renegotiate with the seller. You get that first quote back, renegotiate. When the next quote comes back, it’s twice that and you’ve already closed. It’s making sure that you’ve actually used your due diligence time to build your grounds team. That’s something we’ve not done in the past.

That’s the first thing we do before inspection expires just to make sure that if it’s a new market, we have all the contracts. We’ve had three quotes for everything, and we’ve collectively as a team picked out which contractors we’re working with, and then we go back and do any renegotiating with the seller.

Andrew: Got you. And you manage the operations in-house? Any project management that’s all in-house?

Alex: Everything’s in-house through our management team. We have project management, construction management, leasing department, and upper management, each of those, and then VA assistance as well. We work with a lot of VAs.

Andrew: Okay. How many people are on your team now?

Alex: Fourteen right now including VAs, not including site managers, obviously.

Andrew: Nice. Alex, what do you think are the most important things that passive investors need to look out for when investing into mobile home parks?

Alex: Yeah, that’s a good question. I knew you’re going to ask that, so I prepared for this question. One that’s been asked to me lately that I never thought about to be completely honest is, what do you do if shit goes wrong, basically? How do you replenish the capital? Because I never thought about that.

For the most part, we’ve never had to do major capital calls, had to stop distributions, or anything like that. I’ve heard horror stories from partners coming in. This happened in the past, they brought other people in, and they diluted our equity.

Personally, my mindset around that is I just have such gratitude for my cash providers that if anything went wrong, it’s no question that I would find a way whether I had to dig into my own pocket, refinance my house, whatever. I personally guarantee all those promissory notes are all personally guaranteed.

I’ve started explaining that in my pitch like, that’s very clear. Just so you know, here’s what happens if something does go wrong. If I can’t make a return, that comes out of my pocket. I don’t take any fees. I just get surplus proceeds after all debt providers have gotten. These are debt providers, they have to get their interest. I think that’s an important question.

Andrew: I think we should touch on that too just real quick. Since they’re debt providers, they don’t get depreciation. But sometimes, you said you do allow a split of equity so they can get some depreciation, because the tax benefits are something a lot of the LPs that I talked to are really interested in.

Alex: Yeah, it just depends on who I’m working with. I’m very clear. That was the second question I was going to go into, making sure you know your goals as with cash providers to what you need for tax purposes, because if you are someone in need of getting some tax benefits, then you’re not going to get that as a lien provider, as a debt provider. Your 1099, that’s pure income. You’re getting taxed on income.

With the more sophisticated investors that I work with, I’m always very clear here’s the reality. But the benefit of this is you’re going to get your fixed interest. These are a lot of individuals who are used to getting their 7%, their 401(k)s, or in a high yielding savings account, 4%. To go from that to 15% is very incentivizing.

They understand the risks associated with, okay, but you are, I’m seller financing this, you’re second position. If there’s multiple cash providers, you might be in third position. Here’s the legalities of that and how that works.

It boils a lot down to trust. A lot of times, we’re only putting in $50,000, $75,000, $100,000, because I only need $300,000. I’ll cover the $50,000 or whatever’s left over kind of deal. I build their trust, and they’re like, hey, this worked out, let’s do another one. It’s not even syndicating without syndicating to give them equity post refinance. After they get liquidated at the end, I could give them a promise of 10% equity after that kind of deal.

That’s something I’ll do as well. Hey, let’s do a one year. Also on these smaller deals, I can do shorter horizons, two-year turnarounds. We’ve been pretty on target with hitting our marks with two or three-year seller finance deals and refinancing or selling within that window. If I do refinance, a lot of times I’ll promise my partner’s equity post liquidation as well.

Andrew: Very interesting model. It definitely works with probably when you accept a little amount. You need such a little amount per deal that that could work. That’s interesting.

As an LP, you definitely want to look into the deal structure and fully understand that, because this is one unique way to structure it. What else? What else, Alex? If you were a passive investor looking to invest in another GP or something into a mobile home park, what would you tell them to look out for? What would you look out for?

Alex: I think doing your own due diligence on the park. I think it’s probably been said on here before. If you’re not investing in a fund, if you’re investing in an individual deal, I think it’s vital, because this should be a learning lesson. You could go invest in Vanguard if you wanted to be completely passive, completely disconnected. That’s not the experience that I try to create, because most of these individuals are like, hey, I want to learn, I want to get into this. It’s like, hey, cool, come partner with me, we’ll learn, and it’s a win win for both of us.

It definitely depends on the demographic. As you get into the more accredited investors, they really are just looking for that lucrative return on their investment and those tax breaks. I think us operators, we are obviously, inevitably going to be somewhat biased. We want to close on the deal, we want it to go right.

I think my cash providers have brought up things that I didn’t think about. They say, well, what about this? And what about that? Like, oh, yeah, maybe I should. Or do you really think we’re going to hit that cap rate on the refi, and then maybe we should adjust that? I’ll go back and adjust my underwriting, and I feel a lot better about it. I’m like, hey, they truly brought value to this by doing their own due diligence.

They trust me in that, okay, he’s just going to own up to—maybe when things do go wrong, we’re going to quickly adjust, and he’s not going to be too prideful to make an adjustment and be agile. I think there’s nothing wrong with auditing and doing your due diligence. Of course, you got to trust the operator, but the deal is just as important.

Andrew: Totally. I think understanding the deal structure, not waiting until you get your K-1 the following year to say, oh, geez, there’s not a negative number on here, I thought this was something different. That’s important. Alex, what does the perfect mobile home park look like in your eyes? And why?

Alex: Fully occupied. The Sunbelt, year round market and year round warmth and sun, no frozen pipes, and then at least high 80s or low 90s-plus age homes. Live-in rock star management, public utilities, paved roads. I have one in Texas that’s been a great deal. It is a beautiful park. All the homes are 80s-plus. We’re on all public utilities. We’ve got covered carports on all the driveways, and it shows.

The energy of our tenants are just in a better quality of mood. I think the value of your park is, how is the overall feel, the vibe, the demographic? The small amenities matter. We don’t have any high class parks with pools or anything like that. Just anything with small amenities, trees, shade picnic tables, common areas, dog parks, keep your tenants happy.

Andrew: You can tell. Even on Google Maps, if you’re doing a drive through a community, it’s not perfect, but it looks semi clean and well-maintained, likely from my experience, that’s how it turns out. The investment turns out to be that way. But in the ones that look ratty, in just really super, super low income, and the homes are falling out of disrepair, those are the hard ones.

We’ve passed on so many deals that penciled out at super high cap rates this year, but the average age of the homes was really old, there were smaller homes. From experience, you’re just going to have higher turnover in those types of parks. In the early days, it was like, oh, we got a $15,000 rehab budget.

For every park-owned home, we’ll be fine. It doesn’t matter, you can put $15,000 and put lipstick on a pig, but it’s still a pig and your turnover, no one’s going to want to live in that 12-foot wide home for longer than three months, especially if it’s in a northern state that gets really cold and there’s not a lot of insulation. We’ve learned the hard way on a couple of those as well.

Alex: Until you’ve been inside some of those yourself personally, seeing the house and how they’re configured, and you’re like, oh, wow, we thought people could really live in these. I’ve heard it said on this podcast before, but it’s like, yeah, that’s fine. Even if you renovate it and make it look nice, what happens if you truly are going to hold this for five or 10 years? Those 60s homes eventually turn to dust, and then it’s far more costly than even a vacant lot at that point.

Andrew: I’ve slept in a mobile home for a summer. You don’t realize until you’re in one, how thin the walls are, how thin the floors are, how the walls with a lot of wind or a storm, how you hear every raindrop, and you feel the walls moving and in an older home. It’s just a different respect when you’ve lived in one for a while on an air mattress in one of the bedrooms on the floor.

Alex: Yeah, I commend you for that.

Andrew: Yeah, it was an adventure, a big project up in Iowa. Alex, what do you think is the biggest threat to mobile home park investing?

Alex: I think what we just touched, the age of these homes, because as we lose existing homes, replace them with $100,000 homes and $160,000 homes, we have these grandfathered parks that we can’t bring new homes in or whatever the case is, and we have all these new apartments going up, I just think that’s the biggest concern. It’s trying to protect that diminishing supply.

There’s a lot of moves being made, but as costs go up, and again, the cost of these homes, like we talked about, it’s just not sustainable in certain markets. That’s where the RV parks came into play. We don’t like the transient or the short term, but even just supplementing that, if you can get away with that, depending on the ordinances, where the park is, bringing in RV sites, is a great option, and doing monthly supplementing that.

We’ve been able to take maybe an 85% occupied park in Texas, just take that other 15%, and designate it at the same monthly rate as the mobile homes, but do it in RVs. I think with the economy and the interest rates, I really only see that helping our case right now. I think there’s going to be a lot of trading going on. I think we were going to have that second cycle.

There’s still mom and pops, and then there’s also us operators that are selling to the next set of operators. I think there’s a lot of financial distress. Not only does that help the demand for affordable housing, but there’s going to be more distressed sellers. Wholesalers are going to be getting us more juicy deals again. We’re actually ramping up cold calling. My biggest concern is just supply right now. It’s like, all right, let’s start our acquisition team back up and start turning over our own rocks kind of deal.

Andrew: Yeah, that’s always a good idea. There are always deals out there to be had. Alex, how can our listeners get a hold of you if they’d like to do so?

Alex: Either Instagram, it’s @alexdonnolo or my website, alexdonnolo.com.

Andrew: Okay, awesome. Thank you so much, Alex, for coming on the show. I really appreciate it.

Alex: Absolutely. Thanks for having me back. Sorry for the technical difficulties, man, but it was a pleasure being here.

Andrew: Awesome. Yeah, for sure. That’s it for today, folks. Thank you all so much for tuning in.

Would you like to see mobile home parks values and projects in progress? If so, follow us on Instagram @passivemhpinvesting for photos and awesome videos from our recent mobile parks acquisitions. Once again that’s @passivemhpinvesting on Instagram. See you there.

https://keelteam.com

Andrew is a passionate commercial real estate investor, husband, father and fitness fanatic. His specialty is in acquiring and operating manufactured housing communities. Visit AndrewKeel.com for more details on Andrew's story.