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MILL CREEKMANUFACTURED HOME COMMUNITY
OCTOBER 2017
CONFIDENTIAL EXECUTIVE OFFERING MEMORANDUM
SNEADS FERRY, NC 28460
MAXWELL BAKER/404-442-2807/[email protected]
1075 old folkstone rd.
MAXWELL BAKER/404-442-2807/[email protected]
TABLE OF CONTENTS
OFFERING OVERVIEW• Welcome Letter
MILL CREEEK MANUFACTURED HOME COMMUNITY • Executive Summary• Key Considerations• Rent Roll• Investment Highlights• Property Description• Financial Overview / Infrastructure• Aerial Map• Demographics• Location Map• Rent Comps
ADVISOR BIOS
0102
03
WELCOME LETTERINVESTMENT OPPORTUNITYWe welcome the opportunity to provide you with our in depth overview of Mill Creek Manufactured Home Community and its position in this current market. We will give you our honest, no holds barred assessment of this 39-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.
OFFERING OVERVIEW | 3MAXWELL BAKER/404-442-2807/[email protected]
PROPERTY LOCATION: Sneads Ferry, NC 28460
PROPERTY TYPE: Manufactured Home Community
TOTAL LOTS: 39 pads
VACANT PADS: 3
TOTAL POH: N/A
LOT RENT: $210
AVERAGE POH RENT: N/A
ACRES: ± 30.8 acres (park consists of two parcels)
PRICE PER PAD: $19,230.77
TOTAL PRICE: $750,000
EXECUTIVE SUMMARY
INVESTMENT OPPORTUNITY
Lee & Associates and The MHP Broker are pleased to offer the sale of Mill Creek Manufactured Home Community in Sneads Ferry (Onslow County), North Carolina, ideally located near Topsail Beach, Jacksonville NC , and one hour from Wilmington.
Mill Creek MHC is offered as a stabilized community with plenty of upside in a strong market in Jacksonville MSA. The property has 39 lot-rent-only tenants each paying $210 a month. There are three vacant lots. Current occupancy is roughly 92%.
The park consists of two parcels: westside parcel is ±17.3 acres; eastside parcel is ±13.5 acres. Seller plans to subdivide approximately 8 acres from the westside parcel and offer the new 8-acre parcel for sale separately.
Mill Creek MHC was built in 2003 and has city water that is sub-metered and direct billed to the tenant. Each lot has its own septic system. There are no park-owned homes. The tenant-owned units are in good shape with the majority of them being ‘80s and ‘90s models. The privately maintained roads are gravel and in average condition as our offering price suggests. Seller will pave the park’s western side road and provide a permanent easement with no repair responsibilities so new owner will not incur any road repair costs in the future.
This property is being offered as a stabilized investment with a 8.54% CAP on current lot-rent-only using a 31% expense ratio. The price per lot is approximately $19,230 each and includes full infrastructure for each lot. We are asking our investors to submit offers at or above $750K for the park, not including the ±8 acres of land. The potential of this park, using an 95% occupancy and only calculating the current market $250 Lot Rent Value, is $900K.
MILL CREEK MANUFACTURED HOME COMMUNITY| 4MAXWELL BAKER/404-442-2807/[email protected]
KEY INVESTMENT CONSIDERATIONSPROPERTY ADDRESS:
# Pads: 39 PPP= $19,230.77 Seller BuyerBased on Purchase Price of List Price: $750,000 Current YEAR 1
$ 750,000 $ 750,000
Base RentPad Rents 92,880$ 92,880$ Vacant Pads at Market Rents 3 Lots / 0 POH 7,560$ 7,560$
Gross Potential Rent Income (GPRI) 100,440$ 100,440$ Reimbursements
Water Direct BillTotal Expense Reimbursement -$ -$ GROSS POTENTIAL INCOME (GPI) 100,440$ 100,440$
VACANCY 7.69% 7,560$ 7,560$
EFFECTIVE GROSS INCOME (EGI) 92,880$ 92,880$ EXPENSES:
R/E TAX 4,200$ 5,670$ INSURANCE 1,000$ 1,250$
MANAGEMENT -$ 9,288$ MAINTENANCE -$ 4,200$
WATER Direct Bill -$ SEPTIC 1/1 (Built in 2002) -$ 390$ TRASH 2 Dumpsters 3,000$ 3,500$
ELECTRICTY steet lights 1,224$ 1,400$ LANDSCAPE -$ 1,350$
LEGAL -$ 500$ LIC / PERMITS -$ 250$
ROADS Private, Gravel, Good Condition -$ 1,000$
TOTAL EXPENSES 9,424$ 28,798$
NOI----------------------------------------------------------------------------------------- 83,456$ 64,082$
INCOME & EXPENSE REPORT
Mill Creek MHP - 1075 Old Folkstone Rd., Sneads Ferry NC OTHER INCOME (Not Capitalized Income)
POH Rents None -$ -$ POH Expense -$ -$
TOTAL OTHER INCOME -$ -$
OPERATING CASH FLOW BEFORE DEBT 83,456$ 64,082$ Interest Rate Amort. Years Down Payment
DEBT SERVICE #1 6.000% 15 25% 56,960$ 56,960$ DEBT SERVICE #2 Bank Debt - Priced For Cash Offers -$ TOTAL DEBT SERVICE------------------------------------------------------------ 56,960$ 56,960$
CASH FLOW--------------------------------------------------------------------------- 26,496$ 7,122$ PRINCIPAL REDUCTION 23,859$ 23,859$
50,355$ 30,981$
CAP RATE (NOI/PP) - LOT RENT ONLY 11.13% 8.54%COCR (CF/DP) 14.1% 3.8%EXP RATIO (EXP/EGI) 10.1% 31.0%TOTAL RETURN (CF+PRIN / DP) 26.9% 16.5%PRINCIPAL REDUCTION 23,859$ 23,859$ DCR (NOI/DS) 1.47 1.13PRICE PER PAD 19,231$ 19,231$
TOTAL PRE-TAX CASH FLOW
ADVISED PRICING Current OccupancyLOT VALUE 750,000$ 8.54% CAPPOH VALUE -$ NONE GRM / Per RTOTOTAL VALUE 750,000$ 8.54%
PRO-FORMA VALUE 95% OccupiedLOT VALUE 898,050$ 8.54% $225 Lot RentPOH VALUE -$ NONE GRM / Per RTOTOTAL VALUE 898,050$ 31% Exp Ratio
MILL CREEK MANUFACTURED HOME COMMUNITY| 5MAXWELL BAKER/404-442-2807/[email protected]
RENT ROLLUnit Park Name Unit Type Notes Lot Rent Home Rent Rent Annual Rent
1 Mill Creek Lot Rent 215$ 215$ 2,580$ 2 Mill Creek Lot Rent 215$ 215$ 2,580$ 3 Mill Creek Lot Rent 215$ 215$ 2,580$ 4 Mill Creek Lot Rent 215$ 215$ 2,580$ 5 Mill Creek Lot Rent 215$ 215$ 2,580$ 6 Mill Creek Lot Rent 215$ 215$ 2,580$ 7 Mill Creek Lot Rent 215$ 215$ 2,580$ 8 Mill Creek Lot Rent 215$ 215$ 2,580$ 9 Mill Creek Lot Rent 215$ 215$ 2,580$
10 Mill Creek Lot Rent 215$ 215$ 2,580$ 11 Mill Creek Lot Rent 215$ 215$ 2,580$ 12 Mill Creek Lot Rent 215$ 215$ 2,580$ 13 Mill Creek Lot Rent 215$ 215$ 2,580$ 14 Mill Creek Lot Rent 215$ 215$ 2,580$ 15 Mill Creek Lot Rent 215$ 215$ 2,580$ 16 Mill Creek Lot Rent 215$ 215$ 2,580$ 17 Mill Creek Lot Rent 215$ 215$ 2,580$ 18 Mill Creek Lot Rent 215$ 215$ 2,580$ 19 Mill Creek Lot Rent 215$ 215$ 2,580$ 20 Mill Creek Lot Rent 215$ 215$ 2,580$ 21 Mill Creek Lot Rent 215$ 215$ 2,580$ 22 Mill Creek Lot Rent 215$ 215$ 2,580$ 23 Mill Creek Lot Rent 215$ 215$ 2,580$ 24 Mill Creek Lot Rent 215$ 215$ 2,580$ 25 Mill Creek Lot Rent 215$ 215$ 2,580$ 26 Mill Creek Lot Rent 215$ 215$ 2,580$ 27 Mill Creek Lot Rent 215$ 215$ 2,580$ 28 Mill Creek Lot Rent 215$ 215$ 2,580$ 29 Mill Creek Lot Rent 215$ 215$ 2,580$ 30 Mill Creek Lot Rent 215$ 215$ 2,580$ 31 Mill Creek Lot Rent 215$ 215$ 2,580$ 32 Mill Creek Lot Rent 215$ 215$ 2,580$ 33 Mill Creek Lot Rent 215$ 215$ 2,580$ 34 Mill Creek Lot Rent 215$ 215$ 2,580$ 35 Mill Creek Lot Rent 215$ 215$ 2,580$ 36 Mill Creek Lot Rent 215$ 215$ 2,580$ 37 Mill Creek Vacant Lot ‐$ -$ -$ 38 Mill Creek Vacant Lot ‐$ -$ -$ 39 Mill Creek Vacant Lot ‐$ -$ -$
MILL CREEK MANUFACTURED HOME COMMUNITY| 6MAXWELL BAKER/404-442-2807/[email protected]
INVESTMENT HIGHLIGHTS
• Total Price: $750,000• 8.54% CAP• Turn Key MHC - Lot Rent Only• 92% Occupied• Built in 2003• Direct Bill City Water• Large Lots• Tenants Mow Yards• Roads in Average Condition• Surrounded by High-End, New Single Family Home
Developments
• Gravel roads; completely reparied in August 2017• Three vacant lots - full infrastructure• Tenant-owned homes are older ‘80s and ‘90s
models
KNOWN ISSUES
MILL CREEK MANUFACTURED HOME COMMUNITY| 7MAXWELL BAKER/404-442-2807/[email protected]
PROPERTY DESCRIPTIONTHE OFFERING
PROPERTY ADDRESS: 1075 Old Folkstone Rd.Sneads Ferry, NC 28460
COUNTY: Onslow
PARCEL NUMBERS: 033870 (17.3 acres)033871 (13.5 acres)
SITE DESCRIPTION
# OF PADS: 39
TOTAL LAND AREA: ± 30.8 acres (park consists of two parcels)
POH / LEASE OPTION HOMES: None
ZONING: RA - Residential Agriculture
MECHANICAL
WATER: SubmeteredDirect Bill to Tenant
ELECTRIC: 100 / 200 AMP
MILL CREEK MANUFACTURED HOME COMMUNITY| 8MAXWELL BAKER/404-442-2807/[email protected]
LOT RENT: $210 a month
POH (NOT INCLUDING LOT RENT): N/A
TOTAL PRICE: $750,000
TOTAL PADS: 39
PRICE PER PAD $19,230.77
PARCEL SIZE: ± 30.8 acres (park consists of two parcels)
FINANCIAL OVERVIEW / INFRASTRUCTURE
INFRASTRUCTURE Mill Creek MHPNumber of Spaces 39Number of Park‐Owned 0Vacant Pads 3Number of Vacant Park‐Owned 0Single‐Wide Homes N/ADouble‐Wide Homes N/ANumber of Lot Renters 36Homes Used for Storage 0
Road Type GravelFlood Plane NoTopography FlatParking Spaces 1‐FebMowing Responsibilities TenantOther Amenities N/AWater Lines PVC/PexSewer / Septic Septic 1/1Year Built 2003
MILL CREEK MANUFACTURED HOME COMMUNITY| 9MAXWELL BAKER/404-442-2807/[email protected]
DEMOGRAPHICS1 MILE 3 MILES 5 MILES
POPULATION
2022 PROJECTION 670 8,904 13,395
2017 ESTIMATE 641 8,461 12,743
2010 CENSUS POPULATION 365 5,557 9,240
HOUSEHOLDS
2022 HH PROJECTION 315 4,169 6,152
2017 HH ESTIMATE 278 3,643 5,377
2010 HH CENSUS 150 2,322 3,786
2017 ESTIMATED POPULATION BY RACE
WHITE 71.2% 76.8% 78.4%
BLACK OR AFRICAN AMERICAN 14.9% 12.1% 11.4%
OTHER 13.9% 11.1% 10.2%
INCOME
2017 ESTIMATED AVERAGE HH INCOME $72,822 $74,175 $71,599
2017 ESTIMATED MEDIAN HH INCOME $54,264 $57,472 $56,962
2017 ESTIMATED PER CAPITA INCOME $31,538 $31,933 $30,464
AGE
MEDIAN AGE 27.3 29.0 29.1
MILL CREEK MANUFACTURED HOME COMMUNITY| 11MAXWELL BAKER/404-442-2807/[email protected]
LOCATION, SCHOOLS, WALMART & MHC SUPPLY
MILL CREEK MANUFACTURED HOME COMMUNITY| 12MAXWELL BAKER/404-442-2807/[email protected]
COMPETITIVE RENT COMPSPHOTO PARK NAME
# OF PADS
LOT RENT
COMP DATE
MILL CREEK MHPSNEADS FERRY, NCONSLOW COUNTY
39 $210 2017
1PINES MHPHUBERT, NCONSLOW COUNTY
200 $250 2017
2SHERWOOD MHPMIDWAY PARK, NCONSLOW COUNTY
207 $265 2017
3ROYAL VALLEY MHPHUBERT, NCONSLOW COUNTY
200 $265 2017
PHOTO PARK NAME# OF PADS
LOT RENT
COMP DATE
4JASMINE MANOR MHPJACKSONVILLE, NCONSLOW COUNTY
30 $300 2017
MILL CREEK 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 BIOS| 14MAXWELL BAKER/404-442-2807/[email protected]
Glenn Esterson is a Senior Director with Lee & Associates, specializing in investment grade mobile home communities.During his fifteen years in the commercial real estate business, Mr. Esterson has successfully owned and operated mobilehome parks as well as assisting his clients in the sales, leasing and management of mobile home communities throughoutthe southeastern U.S. markets.
Early in his career, Mr. Esterson was working on apartment sales, condo-conversions and property management. Fromthere, Mr. Esterson transitioned into investment sales of multi-tenanted small business parks throughout the Southeast andmid-Atlantic. He and his team has transacted in nearly every southeastern state and holds multiple real estate licenses.
Mr. Esterson works exclusively with private investors as their primary real estate investment advisor for their acquisition anddisposition needs. Mr. Esterson provides clients with expertise in asset management, portfolio analysis, site selection, leaseadvisory and consulting. Mr. Esterson has executed over 200 sale or lease transactions over his career with a transactionalvolume in excess of $100 million.
¥ 2016-Present Lee & Associates, Atlanta - Senior Director Mobile Home Communities¥ 2013-2016 Marcus & Millichap, National Office & Industrial Properties Group¥ 2003-2013 Esterson Management Solutions, Inc. Ð Founding Member¥ 2001-2005 American Commercial Properties, Director of Multi-Family Investment
¥ Sierra Nevada CollegeBachelor of Arts
Profile
Experience
Education
3500 Lenox RoadSuite 200Atlanta, GA 30326
T 404.442.2825C [email protected]
Senior DirectorGLENN ESTERSON
ADVISOR BIO // MOBILE HOME PARKS
ADVISOR BIO - GLENN ESTERSON
ADVISOR BIOS| 15MAXWELL 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
