Interview with Steve Edel & Justin Gonzales from Due Diligence Partners

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Welcome back to the Passive Mobile Home Park Investing Podcast, hosted by Andrew Keel. In this episode of the Passive Mobile Home Park Investing Podcast our host Andrew Keel interviews Steve Edel and Justin Gonzales from Due Diligence Partners.

Due diligence plays a pivotal role in every mobile home park acquisition, whether you’re on the buying side or selling side, of a trailer park investing transaction. However, navigating this process can often feel overwhelming, with numerous boxes to check and paperwork to organize before making a final decision. Fortunately, this is where Justin Gonzales and Steve Edel step in from

As the founders of Due Diligence Partners, Justin and Steve, offer a comprehensive national due diligence service tailored specifically for manufactured housing communities. Managing partner Justin Gonzales, a Navy veteran, entrepreneur and an active real estate investor with over 14 years of experience, has overseen well over a hundred mobile home park due diligence acquisitions. His partner Steve Edel, transitioned from the information technology (IT) field to become an active investor in the mobile home park asset class. Together, they recognized a critical gap in the mobile home park investment industry: the lack of proper and professional due diligence services.

In this episode, Andrew Keel sits down with Justin Gonzales and Steve Edel to dive into the complexities of evaluating and completing due diligence on mobile home parks. They explore key questions investors should pose to general partners (GPs) before committing capital to a mobile home park syndication, they dive into essential due diligence documentation that should be required, they outline the minimum requirements for a thorough mobile home park due diligence process, and they shed light on the costly mistakes often made by mobile home park operators during due diligence.

Join the conversation as Justin Gonzales and Steve Edel (also known as Stathis Edel on LinkedIn) from Due Diligence Partners share their extensive knowledge and recount some eye-opening due diligence anecdotes, offering invaluable insights into this essential aspect of mobile home park investing.

***Andrew Keel and Keel Team Real Estate Investments (Keel Team, LLC) do not endorse any interviewee. This interview is for informational purposes only and should not be depended upon for investment purposes. ***

Andrew Keel is the owner of Keel Team, LLC, a Top 100 Owner of Manufactured Housing Communities with over 3,000 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 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: 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

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Would you like to see value-add 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.

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Links & Mentions from This Episode:

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Keel Team’s official website: 

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Andrew Keel Facebook page:

Andrew Keel Instagram page:

Twitter: @MHPinvestors


Andrew: Welcome to the Passive Mobile Home Park Investing Podcast. This is your host, Andrew Keel. Today we have Steve Edel and Justin Gonzales from Due Diligence Partners on the show. 

Before we dive in, I want to ask you a real quick favor. If you get any value out of this show, would you mind taking an extra 30 seconds and leaving us a review? This helps us get more listeners and it means the absolute world to me. Thank you so much for making my day with that review of the show. 

All right, let’s dive in. Due Diligence Partners is presently the only end-to-end national due diligence service for manufactured housing communities. Managing partner Justin Gonzalez is a Navy veteran and entrepreneur, with diverse leadership experience in real estate, finance, commercial aviation, and manufacturing. He is an active real estate investor with over 14 years of experience, and has overseen over 150 mobile home park due diligence projects in the acquisition phase to date. 

His partner, also on the show today, Steve Edel, became an entrepreneur in his mid-twenties after working for companies of all sizes in the IT field. Steve became involved in the mobile home park asset class-owning communities and quickly came to realize that the biggest industry shortcoming was the need for proper and professional due diligence. 

Justin and Steve, welcome to the show guys. 

Steve: Thanks for having us. I appreciate it. It’s good to see you again. 

Justin: Yeah. Thank you, Andrew. 

Andrew: Totally. Steve, would you mind by starting us out and telling us a little about your story and how you got into mobile home park investing, originally coming from the IT field?

Steve: From tech to low tech, right? 

Andrew: I was like that’s a big transition there. 

Steve: Before I share my story, I’d never done anything real estate–related before, so it really was two different worlds. It was always in tech, IT business, had a marketing business that really grew, I was averaging 90-hour work weeks, pulling all-nighters, managing a team of 40-something folks, and something had to give. 

My wife had a really busy corporate career, and I met an awesome friend, Tim, who owned parks. This guy had just opposite lifestyles. I was like, is this real? I was intrigued, man. I was like, something’s got to give, I want to know what this guy’s doing. That was the start. 

My wife, Kristen, goes to a Frank and Dave Mobile Home Park Bootcamp, comes back, says it’s awesome. I’m half paying attention because I’m running a business here. Sounds great. Now that was 15 years ago, and she’s like I think this sounds really good. It might be something for us to look into. 

She purchases our first park—I’m still half paying attention—the park does exactly what it’s supposed to. A year later, as I’m starting to sell the business, I go to the same Frank and Dave bootcamp, make really good friends with the guys, and the rest is history. 

Fast forward, long story short, I worked with Frank and Dave. I sourced dozens of deals. I sourced like 50 different parks. That was another business I did. 

Andrew: Selling for them? How?

Steve: I was actually sourcing and assignments. I created an assignment business, which I did for three years. That was awesome and fun. Then I partnered with Frank and Dave on a bunch of parks. I owned some myself, but owned many more later. 

The part of it I always liked doing the best was due diligence. We all have our favorite part. For me, it’s just always due diligence. One day I had an epiphany. I’m like, why not just formalize this thing? See what happens. That’s how it took off. 

Within a year later, it just really took off. Justin joined the team and then we really just continue to formalize it, build everything out. I’m probably leaving a whole lot out, but that is the shortest version I can give you. I’ve had many businesses, but that’s my short version.

Andrew: That is so awesome. You and I just met at the Texco event in the gym, out of all places, which was really cool and I got to learn a little bit about you, but let me get this right. You guys bought your first park 15 years ago, so that was around 2010 or 2009? I think everybody and their brother wished they got in the business at that time. Would you mind just shedding a little bit of light on what it was like? Whether it was all just buying 10 caps on actuals? 

Steve: I love that you picked that because it was 2009 and that rings a bell now that you say that. In hindsight, I have a very vivid memory of how on the fence my wife and I were for the deal because we were such rookies. It’s like what every single rookie does right. No mistakes, but just an outlook and you don’t know what you don’t know. 

We were looking at analysis paralysis. We’re looking at all the numbers and it was a seven cap. The park is in New Braunfels, Texas. We were so on the fence and almost didn’t pull the trigger. It was from a broker who is like I don’t know how much we can raise the rents. I think the rent at the time we bought it was maybe $260, and now it’s at $650.

Andrew: It worked out for you.

Steve: It’s just funny. You don’t know what you don’t know and we were very apprehensive about our first deal, not having a freaking clue that it was a fantastic deal. At that time, I didn’t have the ability to easily look ahead and say, of course, this is a guaranteed slam dunk. 

Andrew: A very similar story. One of my mentors, Ryan Smith of Elevation Capital, lives in Orlando here. He tells a story about how he was looking at a deal and I think it was in Jackson, Tennessee. It was his very first deal, him and his wife, Jamie. 

Before closing, he went into the bathroom and threw up because he was so nervous. He’s like what am I doing? It was a big risk, and now he owns over 10,000 lots. That analysis paralysis thing, I think that plays into doing good due diligence and how that can ease some of those worries. 

Just real quick, because I know you still own parks now, Steve. How many parks do you own? How many lots does that equal? 

Steve: I still own a dozen parks in Texas. I’m not actively buying any more for myself, but I love to help out friends, family, employees that want to purchase. Seven hundred lots total. Before then, I sold at least probably about 20 parks in the past. For a while now, I’ve had a dozen parks in Texas and am looking to hold onto them for a while.

Andrew: That’s awesome. That’s fantastic. Justin, we’ll move to you. How did you and Steve get together and start this venture? 

Justin: Well, thanks for opening the floor, Andrew. But I just want to touch on the yada-yada that Steve just glossed over on his journey through the process. He makes it sound so simple and he’s a maniac. 

I just want to brag on him for a second about how well his parks perform like in his current portfolio, and how highly and finely tuned they are. All the true blood, sweat, and tears that he just skips over as like, yeah that’s just what you do to get to where I am. The sacrifice is trivial to him. 

I just wanted to say that everybody is super impressed. I’ll gloss over that stuff. It does take hard work, but it is attainable. I just want to throw that out there. 

Steve: Thank you, Justin. 

Justin: Of course. As far as my story goes, yada-yada, I did me stuff. It was like the end of 2020. Everybody’s just like what are we doing here? I’m working from home for this capital manufacturing equipment company. We’re making agricultural equipment. It was a startup and we were making it work for industrial hemp. 

It was a good opportunity at the time, totally random. It has nothing to do with real estate. Why am I even on this podcast? The CEO of my business school said hey, there’s an opportunity that I think you need to take a look at and I came and met with Steve here. He’s like hey, I’m ready to transition out. I need help growing this company or just maintaining it, whatever, and this might be a good fit for you. One, two, three, we partnered up and like he said, the rest is history. I’ve been here at the “helm” since then and been working hand-in-hand to provide this service to the industry.

It was obvious to me how much of an opportunity it was to work with smart, motivated, and dedicated people that are trying to get into this industry. I saw a population that’s being underserved and that affordable housing is always a need. You want to say it’s recession-proof. It’s not going away. It’s only going to be more demanding if things keep going the way they are. 

Andrew: That’s fantastic, wow. Now it’s 2024, maybe just step back and tell us a little bit about Due Diligence Partners. What that process looks like? What the full services that you provide to operators in the acquisition phase?

Steve: Let’s start with the pieces of it. There are two pieces of it, and that’s the offsite and the onsite. For the offsite, that’s everything behind the screen, if you will. It’s everything you can figure out about the deal before you actually physically go look at it. It’s fun to look at how you would approach a new deal when you compare the rookie investor to the more experienced investor. 

You’re the rookie investor and you go to Frank and Dave Bootcamp, which is awesome, but it’s a three-day bootcamp. If they cover all the things you should know or all the nuances, it would be a hundred-day bootcamp, but it’s not. It’s a three-day bootcamp. 

There are all the basics that we all know about offsite. You ask for the DD material. You ask for the rent roll. You ask the city what the type of zoning is and so forth.That’s the offsite stuff. 

Then there’s the onsite piece of it. Where does DDP come in? DDP comes in where we’ve got 600 tasks total, give or take 50, and that’s a lot of things on the list. The list is only as good as the person that’s using it. If one of those things on the list fails, it spawns off 10–20 other things that we look into. 

I could give you a billion examples, but let’s just say, for example, the zoning thing. The very first thing that happens on day two is we kick off about 30 questions on average to the city. Asking them about all the zoning, compatibility, usability, code issues and all of that. Well, it comes back and it’s a legal non-conforming park. Well, that’s just about every park in America. We’ve got 50,000 parks in the US, so now what? 

Well, with our experience, we dive in and there’s much back and forth. Legal non-conforming doesn’t mean anything these days. There are many underlying restrictions that if you don’t know what to ask, you’re simply not going to find out. You’re not going to uncover it. For example, does a new buyer trigger this and that? Are there home age restrictions? So many things. That’s the offsite piece.

Then there’s the onsite piece. The onsite piece is everything from droning technology. When I say drone technology, it’s not like a pretty flyover. We have commercial software where we pre-plan a flight. It’s autonomous, takes off, and takes hundreds to thousands of pictures. Then when it’s done, stitches them all together for an interactive 2D/3D topography map that we use to get exact numbers, measurements, and even quotes on everything.

Here’s the part where like Justin’s yada-yada, he glazed over it. Well, there’s just so much management Justin does, so much work Justin and the teams do, because there’s the onsite team and there’s the offsite team to coordinate everything. It’s just never-ending. Whether you’re like the rookie or the experienced investor, not too many folks want to follow up with the vendor four times. The onsite part of it is everything from insane amounts of coordination and follow-up with not just vendors, but even management.

Andrew: Cities. 

Justin: Yeah, cities especially, municipalities. 

Andrew: To follow up with them. Everybody else is […]

Justin: Yeah. 

Steve: Take a simple example asking the manager to make sure everything is unlocked so you can go in the home. Yeah, right. You show up and there are hardly any keys for the home. Nobody’s gotten the required notice they were supposed to get to go into the homes. If you don’t know what to ask, it just doesn’t happen. 

The onsite team coordinates all this stuff ahead of time, especially if there are private utilities. Then we’ve got operators involved and knowing what level of operators they are and yada-yada. 

Justin: State EPA requirements, things like that.

Andrew: I think we should step back for a second because we’re diving into this and getting in the weeds. I think other asset classes, I dabbled into self storage. The due diligence was so much more straightforward because it’s just metal boxes on a concrete slab, where with mobile home parks, a lot of these assets are 50 years or older. Extremely old assets, and the utility infrastructure is such a core component of what you’re buying in that land improvement. 

When they’re that old—we haven’t even really talked about that, the whole utility infrastructure—that’s a whole undertaking to test the quality. It can extremely affect your CapEx budgets, expense ratios and so forth. I think that’s why we’re talking about this as due diligence is a lot. If you don’t have a team internally and can afford to do that, your guys’ team handles that in-house for service. I think it’s brilliant. 

I was telling someone the other day when you go to the Frank and Dave Bootcamp, you get this 30-day due diligence handbook. It covers a lot of the big stuff that is better than not having anything. But I think it had like 50 checklist items in there. Now that we’ve bought as many parks as we have, our list has grown to 350 checklist items. You just said your guys are at 600 and you guys do this all day, every day. That is what you’re paying for is that experience, which is tremendous because there’s little stuff. 

One mistake that I made is I didn’t meet with the power engineer on one of my acquisitions. I only met with an electrician. We went and looked at all the pedestals. They looked fine. There was me missing conduit here and there. We got a quote to get that covered up, but we didn’t meet with the power company and engineers to realize that oh my goodness, there are only five transformers in this whole 61 lot mobile home park. There should be a transformer for every five or six homes. Otherwise you’re going to have brownouts and you’re not going to be getting juice, especially new homes that come in with 200 amp panels. 

Then the power company, which normally 90% of the time pays for new transformers, this one didn’t. We had to buy new transformers and get those installed, those are not cheap. That’s why we’re looking at due diligence and why it’s so important. 

I guess one thing that we had when we posted on LinkedIn, people wanted to know your horror stories. They wanted to know what are the things you found in these mobile home parks that just were super scary. 

A lot of these things are mobile home parks owned by mom and pops who do curious things like put a lot of underground storage tanks and they put concrete on everything. Maybe you guys can tell us about your horror stories. How about we start with you, Steve? 

Steve: Talking about onsite though that can segue into one of these crazy stories. The other way to summarize onsite is a team of two to three people that are onsite for two to three days. Everything comes out, all the horror stories, all the craziness, everything comes out, versus when you’re a rookie buyer at the beginning, you can’t spend more than an hour or two on-site because you don’t know what to do or you’re with yourself. You don’t know what to look at anymore. You don’t know what more questions to ask.

Andrew: Or who to ask, right? The plumber that the seller used it’s important to get him on site if you can, to see where he fixed the water main lines. If you’re talking to a random third party plumber, he’s not going to have that insight, so I agree. 

Justin: Or you just have more important things to do with your time. You’re looking at 15 deals you’re like, I don’t have three days to spend at this property, but you need to totally. 

Andrew: Totally.

Steve: Crazy stories. I would say what comes to mind to share with your passive investors is probably things related to infill. At the end of the day, everything is based on the usability of the property. That’s it, end of story. There’ve been many crazy stories, but the ones that hurt the most are when you can’t do what you want to do, your intended use of the property, or your intended expansion. 

One that comes to mind was a park in Missouri. On paper, it looked great. Numbers are pretty good. One of the vacant areas was 40 lots. We go on site and nothing looks too crazy from the top down, but then we start doing the normal things like we always do a video inspection. We plan that ahead. We’ve got vendors and backup vendors scheduled because inevitably we’ll have issues with vendors.

We start to probe around and we can’t. It’s like in the sewer lines. For the listeners that are new to investing they might not know what bellies and terminology like that means. Generally, your infrastructure is half of the value of the property, so you need lines and you need things to travel through those lines freely without issues. 

We inspect those lines and we do a video camera inspection. There’s a difference between going through it and saying, okay, we’ve got issues and identifying them, versus the lines that have collapsed. They’re gone. They’re destroyed. 

For this example, in this particular job, the lines had collapsed. Everything had collapsed because it hadn’t been used in over 20 years, but it was just like the worst case, completely disintegrated. Got a hold of a particular person in the city after the fact because then we had to ask questions about permitting and would there be issues with getting those lots back online.

It turns out one of the people in the city knew about it. They’re like oh, yeah, it just wasn’t disclosed by the seller. Here we’ve got 40 lots gone, would have to be completely redeveloped, and somebody in the city even knew about it. That’s one. Justin, I’ll let you share with me more, but that’s the smallest. I have many bigger, horrible stories, but that was the first one that came to mind that’s just a very straightforward infill issue.

Andrew: If you’re planning on infilling, that’s why a lot of people that we’ve had on the show, previous operators, some people stay away from infill because there’s more risk. There are more things that can go wrong. But if you didn’t try to camera those sewer lines and you’re budgeting $25,000 per lot to come in there and put homes on those lots, then you get in there and you need $300,000 or $400,000 in new sewer lines. It’s out the window. You’re at 20% IRR is now a lot less. It’s really really important on the forefront to get proper due diligence done. Justin, you got a story for us?

Justin: I’ve got a few. I mean, I’ve got a lot. I mean, there’s a story for every single park you look at, really, and I love reading through the investor groups on LinkedIn and stuff because I hear people like, I just did this, or this was the mistake I made. 

Frankly, from a passive investor standpoint, I like seeing that stuff. I’m like, cool, you’ve been baptized by fire. You’ve gone through these things because it really does take the experience to know what you’re looking at. 

Kind on that same property, just to expand on that story that Steve was just talking about, he said the lots haven’t been used in a while. You’re like well, why not? Because brokers or whoever else—not to just throw them under the bus—are doing their job. They’re trying to sell a property. They’re like oh, there’s tremendous upside. There are 30 vacant lots of this thing. Then we go on there and there’s grass growing over everything. These clearly have not been used in a long time. We’re like what’s going on here?

On top of the sewer lines being completely collapsed, which is probably the reason why they hadn’t placed a home there, the offsite team went to the city and they had this 12-month vacancy rule. Even if you wanted to bring the homes in and assumed okay, I’m going to underwrite the appropriate amount of money for these to replace the utilities. It was like hey, if your lots have been vacant for over 12 months, you lost them. 

The reason for that and why this is so important to talk to the cities is because they had plans to completely redevelop the area into this new community center. They just wanted this thing gone and they were doing everything they possibly could to get rid of it. 

This is like a cake for an attorney. They’re just like, yes, let’s fight the city, I imagine. They’re throwing everything they can at this property to get rid of it and to shut it down. 

One thing that just talks about a different story. We ran DD in this park and it was like Northern Wisconsin. One of the things we always do is lease audits. We always look through the lease audits and we’re looking for quirky stuff. We’re like, what’s in here? We’re not attorneys, but if we see something that’s clearly outlandish or weird or completely lacking. 

One of the things that we noticed in this property was there was no mention of compliance with local regulations or anything like that. It was that tenant-owned homes can do whatever they want and we’re like okay, this seems weird. It’s not a good recipe. 

The onsite team gets to the property and we’re going through and we’re like, these sheds seem close to the homes. It’s a 250-lot property. We fly the drone, like Steve said, and then we did our digital measurements, which is accurate to an inch. We’re like these sheds are about three feet from the homes. Again, there are a lot of them. We’re talking about hundreds of sheds here. 

We’ll come to find out, we report that back to the offsite, and they’re like, the shed’s got to go. It’s a health and safety violation. The fire chief was like, nope, you can’t have those. The fire can jump from the home to the shed. They’re all wood. I should’ve mentioned that. He was like, I’m not having it. You’re not going to get an operating permit until these are removed. 

The new buyer had no idea until we found it, of course. The seller was basically like, I’m not going to get rid of them because then I got to disrupt my tenant base and get rid of all these sheds. It was a giant nightmare for all 250 tenants to remove their sheds basically from this property. It was just a little gotcha. 

Andrew: A major problem. I think it’s important that going in, you may be using a local bank or a credit union to buy these mobile home parks because they don’t fit the mold. Most operators, that’s who they’re using. But then when they refinance, they plan like us. We plan on using agency financing. It’s like the best debt available for mobile home parks; there or Conduit CMBS financing. 

When you go through getting financing with the agencies, for example, they are very stringent. They have their own engineers they send out to the property. They have their own phase one person, their own ALTA survey person that they’re sending out to the property, and they’re going to find everything. 

We got just a boundary survey on one of our parks we bought when I first started and thought that was sufficient. Then we went to refinance into agency financing, and found out that six of the lots had gas lines underneath them, which would have shown up on an ALTA survey. The ALTA survey was $7000 and this was a 50 lot park. The credit union that we used to finance the deal only needed a boundary survey.

There are other reasons to do a full look of these properties because again, the newer homes are longer and they lay differently on these smaller lots based on when the park was developed. That’s really good. That’s good. 

Steve, let me throw a question your way. If you were looking to invest passively with another mobile home park syndicator, general partner operator, what are the top questions you would ask of that GP before investing with them? Knowing about due diligence and everything and your experience forth.

Steve: To approach it from when I put my investor hat on, for me, track record is everything. I have a hard time investing or working with anybody who doesn’t have a proven track record. For me, that would be number one. Number two is as an investor, I would be curious about how the property is secured. I’ve had friends that have invested in a few various funds, and a few of them got burned because they didn’t look at the fine print. They didn’t look into the details of how the payouts would happen, and how much the risk was spread. 

For example, you can invest in just one property, or you can invest in a fund where the risk is spread across 10 to 20 properties. If you have one blow up, who cares? That’s what would come to mind for me strictly from a standpoint of securing my investment.

From a due diligence standpoint, I’d probably be very annoyed. Again, if the company had a proven track record of this not being their first rodeo and it’s their sixth fund, then I’m like, these guys do most. I have a company that comes to mind. They do 80% of the DD work that we do. They have over 300 parks. Inevitably, some of the parts blow up because shortcuts were taken to look at certain things on the infrastructure or whatever. It doesn’t matter. That’s okay. They’ve already assessed that risk. 

When one or even two parks blow up, if it’s part of a portfolio of 20, it doesn’t kill the deal. It doesn’t affect everybody and still gets returns and distributions. 

But if I were to invest, let’s just say in a group that’s doing it for the first time and doesn’t have a track record, then I would want information on every property, to better understand what the market strength and infill opportunities are for every single property, so that I could have a pretty good stronghold of really understanding what the portfolio consisted of. 

Andrew: It’s very hands-on if you’re going to put money at risk. You want to know what we are looking at here. That’s good feedback. Justin, same question. If you were going to invest passively with a mobile home park operator, what are questions you would ask? What are things you’d want to look at to make sure that it was a solid deal?

Justin: We were asked to think about doing this podcast probably a month ago, maybe a little bit over that. I don’t want to sell your secrets or anything, Andrew, but obviously, I was doing my due diligence, so I wanted to look into you a little bit and see what was going on; I’ve been following along.

My answer to your question ties into what I’m talking about here. A lot of the things I want to know around is mindset. For me, experience will get you about 25% of the way there, but you could have been lucky and you could be too dumb to realize that you were lucky. Like when people were burning hot in 2009 or whatever, or 2021 interest rates were in the gutter and you’re just riding the wave. I’m just like, okay, yeah, you got a couple of easy wins. 

Not to say that that was Steve in any way, but just show me your losses and show me your character. I think you’ve been doing a great job, Andrew, specifically of illustrating who you are as a person with your online presence. That’s something I’m certainly looking into. 

I want to know the people that are running it. I want to know their strategy. I want to understand what their integration plan looks like, because like you said earlier, you’re buying this old asset. It’s been around for a long time. Well, you’re a new company buying an old asset. What are you, just going to run in, take it over, and everything’s going to be hunky-dory? No. This is essentially an M&A. 

You’re folding this thing into your organization. What do your processes look like? What’s your capital reserve allocation going to be? How much extra are you keeping on the table for the inevitable things that are just going to pop up? Regardless of however much you’re covering and due diligence. 

Then when you do cover a thorough due diligence, are you hiring DDP is my first screening question. That’s a joke, but not joking. You really should. Then after that, what are you going to do with that information? Are you going to roll it into your operations? Or are you just going to throw it out the window and be like we just adjust the underwriting a little bit. Those are the things that come to mind. 

One of the other things that really sticks out and Steve touched on this, but I’ve come to realize from all of our clients being that we work nationwide, we see it in different geographical locations is how well do you know the market. If you don’t know the market super well, what’s your plan to overcome that naivety in that location? 

I’ve seen a ton of our clients that know the guy. The guy that just moves homes, he knows all the plumbers, he knows the other park owners, and you get this synergy. You get the cheapest rates, the best work, and it can save your butt when times are tough. If you don’t know those folks, what are you doing to overcome that hurdle? Those are a couple of things that come to mind that I’m looking for. 

Andrew: That is huge and I don’t think we’ve ever talked about that before, but you are so right, and how do you meet the guy. 

Justin: The guy or gal. 

Andrew: You go on site, you talk to all the tenants, you get to talk to the people at the city, you talk to the plumbers, you talk to everybody, and that’s how you meet the guy. You’re exactly right. There’s one guy that totes mobile homes and happens to have a few mobile homes that he sells that are used in his back lot. He sells them for $4000 each, and that’s the guy to go to. Otherwise you’re paying $30,000 for homes to come in from a dealer. Agreed. That’s really good feedback, Justin. Thank you for that. 

Steve, going to you, what are the absolute essential due diligence documents needed from a seller of a mobile home park in your eyes? The bare essentials. If they’re like, I got nothing, I’m a mom-and-pop owner. What are you like hey, I need this or I walk away. 

Steve: I think we know what the standard list looks like. Probably most of your listeners know what the standard list looks like. It’s your rent roll, your asset list, your staff information, those dozen things, your balance sheet, your P&L, the list of a dozen things. 

To take a step back from that, whether you’re buying it or you’re an investor, your goal is to figure out what the story is behind the park. Every park is like a different person—has a different character, different personality, and performs differently. Bottom line is your job is to tell the story. 

When you get that list of standard docs, do you have a story? Yes or no. If the answer is no, then you need a lot more follow-up docs. Say for example, rent roll. Okay, great. You’ve got the rent roll. But you should do a lot more offsite work before you move on to the onsite. Do you have a historical rent roll? Do you understand what the exact turnover is? Do you know exactly how many evictions have been filed every year? 

I would recommend thinking about it from that perspective Again, the list is only as good as the person that’s using it. You’ve got your list. If you can’t quickly fill in a story for the whole park and behind each item, you’re likely missing context, which means you need to ask for a lot more follow-up docs.

My last point on that is, especially if you’re a rookie investor, don’t try to work everything into the PSA, the purchase agreement, possibly because that can scare off a seller. I think the best way to approach it, as far as just initially getting the deal under contract, is to stick with and ask for your standard dozen items. Keep it simple. After the fact, as soon as you’ve got it tied up and under contract, the leverage changes. Now the buyer has more leverage. 

Now you can ask for those things that you need to have. For example, we ask for 100 more items after the fact and we always get them, and that’s because we need to paint the whole picture, fill in the story before we go on site. 

Andrew: I think it’s tough because I just find us with mom and pops that have very handwritten rent rules, their financials are mixed up for some reason with other business interests, and there’s just weird stuff happening. Like you’re saying, you’re trying to write the story of how her daughter is the manager. That’s why they’re paying her $100,000 a year, and you’re just trying to identify this stuff. Then you always hear if they pay me in cash, I don’t put that on the books. I put that in my pocket.

You’re hearing these things and you’re trying to take it at surface level. But if you don’t get a T12, for example, which happens a lot because people are asking for tax returns and they’re saying hey, that’s confidential information. I’m not sharing that with you. You’re like oh, can I get a T12? They’re like, what’s that? What do you say then? What is like your bare minimum? Or do you walk away from that deal? It might be a good one if you got to stop the letters or something, like do you go that far? 

Steve: I’m so glad you mentioned that, Andrew, because I did clarify, when I say we always get the information, that means for clarity we rebuild the information from scratch. I mean, literally we’re making maps. We’re designing maps that don’t exist. 

Then on the offsite side of things, we are literally rebuilding. When we’re talking about the mom and pop asset, exactly. We’re rebuilding chicken scratch. We start with chicken scratch and then we rebuild it from the ground up. 

If the clues are not everywhere else for what the turnover is or what all of the historical information is, then there are all these red flags for the onsite team to just hit the ground running really fast to look at how many homes are actually occupied to figure out what the exact income is.

Andrew: That’s a really good insight there. Justin, going over to you, what equipment is absolutely essential when completing onsite due diligence in your eyes? 

Justin: There are a couple of ways to answer that. I think the most important thing to think about that you should have with you while you’re doing onsite is the offsite work. 

I know that may sound silly, but it’s not like a trick answer. It’s all the preparation that you did before you got there. It’s the list of the vendors that you’re planning on meeting, the schedule of when they’re going to be there, and the backup vendors. It’s the survey of the easements and encroachments, and you want to compare those to the boundary as you’re walking the perimeter fence. Historical maps. You definitely want every map that you can get a hold of, go to all the websites, Google Earth and all that stuff. Just print that stuff out and take it with you. 

You want lot maps, park-owned home maps, contact information for the folks, blah-blah-blah. Those things are supercritical and you can’t gloss over them. I’m trying to but I’m fighting myself. You can’t gloss over it. 

Then you have the technical stuff. You need the obvious thing like your first line gear to protect yourself. Who knows what you’re going to be walking into. There are roaming dogs at these parks depending on the class of the investment. You get super sunburned if you’re out there for a long time, your water, whatever. 

But the gear you’re probably really asking about is what’s like the tech gear that’s going to help you accomplish your mission. For me and the team, the bare minimum is a camera. Typically it’s a camera phone that you can take notes with and you can record pictures and videos of documentation. 

Along with that, you want a battery to be able to charge it because your phone’s going to die in an hour. Or you want a backup phone or have a plan in place because you need to document this stuff. You’re going to look at it and go, wow, that’s horrible, disgusting, or whatever. For some reason we always seem to forget about it. It’s paramount that you record this stuff so that later when you get off the property and you have time to decompress, you can most importantly quantify what you saw while you were there. 

Kind of a luxury item, get a drone or get a drone company to come out and do the mapping for you. That way you can annotate and quantify the things that you find on the property. Potholes, spider cracking, things like that, trees. 

Steve: Can I add on to that, too? 

Justin: Of course. 

Steve: I think it took me at least 20 DD jobs back in the day to learn that if I didn’t have the redundancy, it would always bite me in the butt. Have two and even a third backup of every single thing. Let’s start out with what Justin was mentioning for what you’re bringing in from onsite. 

You’ve got all this tech information, but then we’ve got a paper backup. We literally have killed a forest to print a hundred pieces of paper because we’ve got at least a dozen maps, all the parcel maps, all the different types of lot maps, all the different types of rent rolls, and so forth that we’ve created ourselves. We’ve got this backup on paper because we’ve got one shot at this. We don’t want to have to schedule another trip. 

Then moving on to the onsite, it took years of experience to even learn what to do when things overheat. Not just having backup batteries, backup phones, and things like that. But what do you do in a scenario of do you have ice packs with you? If you’re at a property in the dead of summer where it’s 105 degrees? Or the opposite, it’s too cold. Are you prepared? When you have your list of things that you need for onsite, just make sure you have a secondary of everything and you can appreciate that later. 

Andrew: The charger thing for the cell phone is a huge one. Mine always dies because I’m always taking photos and trying to do all that. That’s huge. One thing I didn’t hear you say, but I’m sure you guys have it somewhere or maybe the drone does this, but like a measuring wheel. We have little, vacant lots because that’s huge with the setback requirements and everything. You probably do it in a fancy way with the drone. 

Justin: We do with the drone. However, there have been a couple of parks that are touching an airport or military installation and there’s no fly zone. We roll out the wheel just like everybody else, we roll out the wheel. You can use laser range finders. Some folks might have a golf laser rangefinders or something for yardage. Just a little handy stuff. 

Andrew: Let me ask this to you, Justin. What do you think is like the most costly due diligence item not normally done by mobile home park operators that you guys use?

Justin: Honestly, it’s probably quantifying. It’s adding everything up. The reason I say that is you’re going to go to the park, you’re going to see stuff, and you’re going to do a job of adding some of it together in your head or on paper or whatever.

Andrew: CapEX like repairs needed, money needed, quantifying dollars to repairs needed, righ?

Justin: That’s right, and in aggregate. Critically is adding it all together because you might be like oh, I think there are me trees like. You use the word trees to trim. Or I think there’s a spider cracking on the roads. Getting and the quantifying that and putting it all together. Even if you have the experience, even if you see it, even if you’ve done this a hundred times, it’s truly being just the most scrupulous nitpicky guy about putting this all together and adding it up, because it’s shocking how fast it can add up. Just trash, how much trash is there that how many roll offs do you need exactly? Three or 13.

Steve: Maybe this would be a time to share our motto for everybody else to adopt. DDP’s motto is remove the subjective. What happens is, especially if you’re in a hurry, you glaze over things and you say, this is a problem, that’s a problem, without quantifying an exact number.

When we say, remove the subjective and quantify it, every single item. If there’s anything subjective about it, it needs to be fixed. That’s not an acceptable answer. For example, for onsite, the average deferred maintenance we find—again, this is an average—is $220,000.

In our reports, every single thing that comes up and is found and identified goes into three cost buckets, zero to $10,000, $10,000–$50,000, and $50,000–plus. Then at the end of the report, there’s an aggregate and it totals this is how much. We’ve had parks that we found a million dollars in deferred maintenance. 

That’s the beauty of it. When you remove the subjectivity, quantify it to an exact number, and accompany it with picture and video evidence, it becomes more material fact and it can’t be disputed. What happens is like one of the industry trends we’re seeing. There’s still a lot of retrading going on, but you can’t retrade.

For newer investors, retrading means a bunch of things that have accumulated that are definitely beyond what the expected property was, so you are asking for a deduction in the price of the cell. But what you often see is that it becomes not an argument or a battle, it’s just differences of opinion, depending on how it’s presented. If you can present the information with everything adding up, and it’s quantified, and the subjectivity is removed, it’s like it can’t be…

Andrew: It really can’t be disputed, which is good. Then you can decide if you want to go to the seller and ask for a reduction or a repair credit. I think that’s super valuable and maybe you decide, hey, this is what we really need. This is what we’d like to have to try to come to a new number. That’s really important. 

I want to ask this to you, Steve. What do you think the perfect mobile home park looks like and why?

Steve: The perfect mobile home park. 

Andrew: What are your parks? You have a dozen of them. 

Steve: I do. All of my parks are absolutely perfect. 

Justin: They do perform well. 

Steve: They are perfect for what I look for, which is stability. I’ve got operator friends that all they could care about is infill, period, end of day. How much meat is left on the bone for them to go in and fill up a hundred more lots. For me my buying strategy never changed. It was always find stable parks in super strong markets. 

I happen to score with that. Half of my portfolio is in New Braunfels, Texas. I have six parks in New Braunfels, Texas. It doesn’t get hotter than that. And of course they stay 100% occupied. For me, for what I want as an investor and to be as passive of an investor as possible, it’s filled up stable parks. That’s my idea of a perfect park. For you, I’d love to hear what yours is. What’s your perfect park? 

Andrew: Like you said, it’s different and I look at it from a value standpoint, like hey, is it a 70% occupied park? Is there some room for some infill? Is it direct-built public utilities in a market with a median home price over $250,000? If it’s the perfect one, maybe it’s $350,000. 

I’m looking at just a cleaner product that looks like a subdivision, I would say, and majority pitched roof homes. I think that the age of the homes matter with turnover, because I think that one thing on me of our early parks we bought that have an older home vintage is we see higher turnover on those parks, and that is like the hidden CapEx dollars that eat away at your cash flow. Those are a couple of pieces of what I would say a perfect park looks like. 

Justin, do you have anything that you would add for your perfect park that we didn’t touch on?

Justin: Again, I always come back to the mindset and I just like to think a little bit in the abstract. Forgive me if it’s not specific enough for the viewers, but it’s almost a cliche where you can say that the ugliest house in the nicest neighborhood is generally going into something I would look for if I’m operating the park. I want something that I can put sweat equity into and really clean it up and give a strong return. 

Andrew: Totally, submeter water, sewer, some of that stuff to really add tremendous value. That’s awesome.

Justin: That’s right, undermanaged.

Andrew: Guys, we’ve covered so much in this episode. I know we’ve ran a little long, but thank you for coming on the show. If anyone would like to get a hold of you guys or DDP, what would be the best way for them to do so?

Justin: You can send us an email, would be a great first line of contact. Go to our website, It’s the easiest way. 

Andrew: Awesome. Thank you so much, Justin. Steve, before we log off, what’s one last bit of important advice you would give an interested passive mobile home park investor? 

Steve: I’d say figure out what your definition of passive is. It’s funny how different passive is from one person to another. Ask yourself that lifestyle question. Will you be happy and will you be okay being completely removed from what’s going on? Or are you always going to have your hands in it? I would say really understand yourself and it’ll only help you out and whatever team you’re working out where you’re working with better to start out with that clarity. 

Andrew: That’s a good point. For a lot of people that have W-2 jobs that are completely out of real estate, do you have what it takes if you want to be active to do the due diligence and everything that’s required to buy a property, or would it be a better fit to be passive and invest with an operator that has a track record, does the proper due diligence, and has the time fulltime to dedicate to that. That’s good feedback, Steve. Thank you for that.

Well, Justin and Steve, thank you guys again for coming on the show. This was awesome. 

Justin: It was our pleasure. Thank you so much for having us, Andrew. 

Steve: Thank you, Andrew. Appreciate your podcast. 

Andrew: That’s it for today, folks. A reminder, please leave a review if you got value out of this show. Thank you all so much for tuning in.

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

Keel Team provides unique opportunities for passive investors to enter the mobile home park asset class without having to deal with the headaches of tenants, toilets or trash.


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