Worried About Investing Being Tough Right Now? Opportunities Like This Make It Manageable.

Are you watching from the sidelines in this market? Many investors are hesitant due to fear and caution. However, we're actively engaged, and you can be too.

While I suggest holding onto cash if you can't find the right investment, we're uncovering opportunities for our investors, and they're reaping the rewards. Let me share one example with you.

The Value of Building Relationships

Our partner, Steve (alias), and his team acquired a mobile home park near Detroit from a mom-and-pop operation in 2021. This proved to be a lucrative investment, benefiting our investors with cash flow and potential capital gains.

Unlike many syndicators who buy from mom-and-pop sellers and cut ties afterward, Steve prioritized maintaining a relationship. He stayed in touch, inviting them for dinners, sending gifts, and making regular calls.

This approach paid off when the sellers decided to sell another park recently and reached out to Steve exclusively. This allowed him to purchase the park at a fair price without competing with other buyers or paying brokerage fees.

Given the decreased transaction volume in mobile home parks, acquiring a value-add park is a significant win.

Key Details of the Acquisition

Here are some specifics about the park:

Purchased at $36,500 per lot, well below replacement cost.

Rents were increased by 16%, generating over $100,000 in net operating income and adding $1.6 million in value.

Additional income of $40,800 was generated almost immediately.

Most tenants are long-term, providing stability.

Our fund is the primary investor in this asset, leveraging partnerships with experts like Steve to access opportunities that offer consistent cash flow and appreciation.

A Bonus Feature

What's particularly exciting about this deal is that it was acquired entirely with cash. Once stabilized, they plan to secure agency debt based on the new appraisal, allowing them to reinvest capital into other acquisitions, potentially compounding investor returns.

Final Considerations

While this opportunity may seem unique, it's part of a broader strategy that has consistently delivered results for our investors. Steve's track record speaks for itself, with a median IRR of over 50% on past deals. While past performance isn't indicative of future results, we're confident in our continued partnership with him and the strategy's ability to thrive in any market conditions.

In previous post: "What are the risks associated with commercial real estate?"