Hillary from Utah is a college piano professor. She wanted to establish a side income so she went to Boot Camp and bought a mobile home park. Three years later she sold it for a $1 million profit. Now she’s trying to do it again. In our next Lecture Series event we’re going to discuss with Hillary how she found the mobile home park, financed it, turned it around, and 101 other topics. We’ve titled it “Play It Again Sam” and we think you’ll find it one of our most fascinating Lecture Series events in years.
If you want to hear how Hillary accomplished this – from start to finish – as well as her lessons learned, then you will very much enjoy this event.
How A Piano Professor Played The Trailer Park Game Perfectly - Transcript
Frank: Welcome, everyone, to another lecture series event. This is Frank Rolfe. We've got a very unusual lecture series, one that was so remarkable that when I heard the story I just had to get her on. We have here Hillary from Utah. And Hillary's story is truly amazing, and we love doing these lecture series with people who have bought parks, because it demonstrates how varied the industry is. You have lots of people who get in the industry from many different occupations, paths and everything, different ages, different everything. And it's great to see someone with an all-new story, a fresh story that we've never heard of ever before who's done well in the industry. So Hillary, obviously you're here with us. We can see you. How are you doing?
00:46
Hillary: I'm doing great. I'm so excited to be on your show. Thank you.
00:49
Frank: Oh, well, Hillary, the first thing I have to ask is, it's so different, is you tell people the background of Hillary. What do you do for a living? What is your career path here?
01:02
Hillary: So I am a tenured piano professor at a state university, and I play classical piano. I play, I perform, I compose, and I teach. And I kind of have my dream job. I love it.
01:16
Frank: Okay, well, you gotta like that. So we have never before had a professional musician or a music professor on the show ever. So that is unique in and of itself So let me start with some basic questions. So had you ever had any exposure to mobile home parks before you decided you might want to buy one? Have you ever lived in one, family lived in one, anyone you know lived in one, have you ever driven through one or how, what was your thoughts on the industry before you ever got involved in it?
01:48
Hillary: I never lived in one or had any family. I grew up around Dallas and I remember kind of visiting some friends of my mom who lived in a very nice double wide. But that was really the extent of it. And I never really thought about mobile home parks at all.
02:04
Frank: And what was your initial stereotype of the industry? I mean, I know I had mine, because I also lived in Dallas, and my first park was Glenhaven, and I was terrified because I had no exposure to the industry at all. So I was freaked out about it in a big way. Based on the stereotype that Hollywood and others create, were you concerned about the clientele or the product, or did you have any stereotype to overcome?
02:34
Hillary: Well, I do. I guess as a young child, I remember thinking that it wasn't as nice as a regular house but when I look back, it actually was a really nice double wide. So I think I kind of just had a neutral impression.
02:49
Frank: Gotcha. So it wasn't something that really, you didn't have any big impression one way or the other, right. You just kind of...
02:54
Hillary: Right.
02:54
Frank: Right. Okay. And actually, you are obviously far younger than I am, probably, I don't know, significantly younger than I am. So from your generation, had you even had much exposure to the negativity? See, people of my era, baby boomer land, we were brought up on anti-mobile home park TV shows. Anywhere from the Rockford Files to you, you name it. Jeff Foxworthy. You probably don't even know Jeff Foxworthy, you probably haven't ever seen him.
03:24
Hillary: Oh, yeah, I have.
03:24
Frank: Okay. Alright. So had you been exposed to much negativity or was that really not part of your life growing up?
03:33
Hillary: I think I absorbed some of it, for sure. But I guess it didn't intimidate me one way or another. I kind of just thought that they couldn't maybe afford a home, but they weren't necessarily crime-ridden or dangerous. So I didn't really have that impression.
03:53
Frank: Okay. Good. Alright. So now, what gave you, then... If mobile home parks are kind of a neutral, what gave you the idea to even look into investing in mobile home parks? Like what was the initial catalyst? How did that happen?
04:07
Hillary: Yeah. Well, I had gone to school for a very long time, studying piano. And then once I started working, I kind of quickly realized that I kind of have a ceiling on my income. So I was trying to find an investment that would just make the most money for me based on my return. And so when I kind of was researching flipping homes or renting apartments, but I knew that I would not be good at those skills. I'm not a handyman at all. I don't understand interior design. So through that, I came across mobile home park investing, and it just made so much sense to me because of the return. I could get 20% per year on my initial investment and then I would still have the property.
04:58
Frank: Sure.
04:58
Hillary: Right. I mean, my plan when I first was wanting to buy one was just to buy one park and never sell it. And then after the mortgage was paid off, I would have like $70,000 a year and it was just like that was the dream.
05:16
Frank: Got it. Okay. So you had this dream and you started looking for mobile home parks, or when did you start expanding on the dream? When did you take action on this thought? I mean, some people, you know, you think of something there's like a while separation before you actually act on that thought. So when did you act on it? What year did you start looking for parks or learning about parks or anything with mobile home parks?
05:41
Hillary: It was around 2013. And so I came across Mobile Home Park Store and I got your audio tapes and I mean, I knew pretty quickly that this was where I wanted to invest. But my issue was that I was paying off student loans. I just did not have enough money to buy a park. I couldn't fundraise, I couldn't get investors. I was just by myself. So as I was saving the money to make up the down payment, I would just continue to research. I would look at the Mobile Home Park Store forum at all the other experiences people had.
06:21
Hillary: And something else that I did would I would just call up deals. I would look at deals, analyze them and I know people would say tire kicking is maybe not a good thing all the time. But it really helped me, it really helped me a lot to call up deals, like I was going to buy them, try to see why is this deal good, why is it bad. And when I did that enough, I just became more comfortable with the idea that, hey, I can do this. And then eventually I was able to find one.
06:51
Frank: So so it's kinda like the same practice you use obviously in piano, right? I assume you don't just sit down, play the song once, and you've got a mastery of it. So you were just trying to fluidly just jump in there and go through the paces to kind of practice up what you were doing, correct?
07:07
Hillary: Absolutely. You know, with music you have to practice every day and it's small, incremental steps that you don't maybe realize you're getting better, but then eventually you look back and say, wow, look at all of the things that I've learned. And so that was a very similar journey to mobile home parks, where I was just learning every day. I couldn't devote eight hours a day, right, but I was doing in my free time kind of like a hobby. Researching parks, kind of thinking about the park I wanted, and then before I knew it I really felt like I had all the knowledge I needed to make a good decision.
07:44
Frank: Okay, so tell us now, so you go out there, you start practicing, now you're ready to go find an actual park. So what is this park you initially find and buy? What's the story of that park?
08:00
Hillary: So yeah, I with my kind of limited resources, I can't call upon friends who are multifamily developers or brokers. So I was kind of limited to cold calling, which I didn't have a lot of success with. And then I just looked on the internet. I just found deals online. And so the park that I bought was just listed online, and I just called them up, made an offer and then it it got accepted.
08:28
Frank: Give people just a rough idea just as far as... You don't have to give us the exact location, but like how many lots, what was the water sewer system like? What are the just the general parameters of this deal?
08:39
Hillary: So it was in the Midwest, there were 43 lots. At the time that I bought it there were 32 occupied with four park-owned homes, and like three rent to owns. It was very low lot rent for the area, like 240. And it was clearly kind of mismanaged, the rents were all over the place. And had city water sewer with PVC pipes. And those were kind of my main things I was looking for.
09:10
Frank: Okay. And then so the turnaround plan obviously was you were going to buy it, raise the rents to market, 'cause obviously those are low rents for the Midwest and the US today, fill up the lots, I assume. Water and sewer, did you push that back onto the tenants or was the park still paying that when you... I mean, what was the plan on that?
09:30
Hillary: Yeah, we had to... So in the interim I got married, so my husband was a big help as well with it. But we got Metron meters and installed them.
09:41
Frank: Got it. Okay, so it's a classic turnaround plan. You go in there, you submeter the water, so people pay for their own use, raise the rent, fill up the lots. And how did you finance it? Was it seller-financed or did you get bank financing or how did you do that?
09:58
Hillary: No, it was just bank financing. So I put like $180,000 down. It was like $760,000. And it was... Looking back, I feel like I got pretty lucky to even get finance, because I was just applying as a no name. But I was fortunate to get to get terms, and so...
10:21
Frank: Was it like a small town bank in the general area of the park or?
10:25
Hillary: No, it was First Secure Community Bank.
10:27
Frank: Okay, John Medernach, right?
10:28
Hillary: Exactly.
10:29
Frank: The guy that we bank with, that everyone loves? America's favorite banker basically should be his title. Okay, very good. So you got ahold of John Medernach, which was a smart idea, 'cause he's a fantastic banker at First Secure in Aurora, Illinois, and so he finances you and he's very good at seeing the the merit of a deal. So the fact that he saw it and said, okay, this looks like it'll work, that's obviously a very good sign.
10:54
Hillary: Absolutely. Because one of the issues was that the seller was kind of a mom and pop, for sure. He was retiring and he would brag that he was lying about his taxes. So he was showing huge losses. So I went to like the community bank and talked to the officer and she said, "Please don't buy the park. I'm begging you, you'll go bankrupt. Look at the losses."
11:18
Frank: Sure. And what was he doing? Because obviously if you have a 30-plus space park at that lot rent, it should be profitable. So how was he showing losses? Was he in fact just misreporting it or not collecting it? Or what was he doing?
11:38
Hillary: I don't know exactly. I know some of the... For the first year-and-a-half there was a lot of stabilization. So he he definitely wasn't getting all of the rent from the residents, but I think he was just taking... I don't know. He was just lying somehow.
11:55
Frank: So just bad operating, bad record keeping. What was the infrastructure like? Was it in pretty good shape? Were the roads decent? I mean, did you have any infrastructure issues?
12:10
Hillary: No. And that was one of the amazing things that really drew me to the park. It was a really nice park. It was built in the '80s with mostly double wides, pretty good road. He was the second owner, and it was just a really nice-looking park. The outside of the homes all looked nice. I found out like the insides maybe didn't look as nice, but from the street it looked very nice.
12:32
Frank: Right. And then, and don't give us the exact location, but locationally, was it in a big city, small town? Like what size population was the county or the metro? Was it big, small, or what was it?
12:49
Hillary: Yeah, well, it was actually in a very small town, like a thousand people. But it was in a very, very large metro. And so I still was hesitant because of that, but after we put it under contract and did the test ad, it was clear there was going to be no problem filling lots because of that metro.
13:08
Frank: Gotcha. And then, so as far as filling the lots went, did you have any kind of floor planning credit source? Did you use cash program or PEP or anyone? Or how did you do that?
13:21
Hillary: Well, we didn't, we tried to do cash, but we kept getting rejected because we didn't have enough lots to fill, so...
13:31
Frank: You probably hit back when they had the 50 lot minimum requirement, right, which they have now relaxed.
13:36
Hillary: Yes.
13:36
Frank: They've eliminated that now. So it is no longer done. They don't have the minimum. But yeah, that would've been during that period. So, go ahead. I'm sorry.
13:43
Hillary: No, so, but it, I think it ended up for the better, because we had those park-owned homes. So the first year or so, the main goal was to get them all to be tenant-owned homes. And then we ended up just selling the park-owned homes for cash, not doing any rent to owns, and there was kind of a mobile home park broker that helped finance people. So then we took that money and then that's how we just bought used homes.
14:12
Frank: Got it.
14:12
Hillary: You know, we really, when we sold, we only had developed two lots. So we didn't even develop it 100%. But we didn't have to go into debt. Everything was paid for and the homes all got sold for cash.
14:26
Frank: Sure. And knowing, and knowing John Medernach and First Secure, probably the park cash flowed from day one, correct? Probably not a lot initially, but it was at least cash flow. 'Cause I know he always stress tests the loans and things. And then how much did you raise the rent just as a number, you know, $30 a year, $50 a year. What was your rent raise plan?
14:49
Hillary: The first year we had to submeter, so we raised it quite a bit. And then, you know, I think a mistake was that the second year we didn't raise it at all, because we thought it was too big of a shock. But then we, it ended up being around $300, at the end.
15:05
Frank: Got it. Okay. So, you're out there, instituting the plan, fill some lots, raise some rent, get the metering back on the residents, and then what happens? You had the original plan, you were going to buy this thing and hold it forever. So then what happens?
15:23
Hillary: Well, you know, one of the things that we were doing is trying to do as much of the management ourselves, like the invoices, you know, the books, the tenant complaints. And so because of that, something that you mentioned in on Mobile Home Park Store is that the bigger the park, the easier to manage. So I just kept thinking, you know, it would be great, this park's doing well, and it was kinda like, maybe we should sell it and buy a bigger park, expand more so our systems can be more efficient. And then this was kind of during the time, where, you know, the interest rates are going really low.
16:01
Frank: Right.
16:01
Hillary: So we thought, let's refinance. And then, we got just a call, a cold call from a broker who said that he thought the park was worth this much. So I said, okay, if you think it's worth that much, let's see. And then it got sold very quickly.
16:16
Frank: And so, just tell people roughly the delta between what you bought it for and what you sold it for. How much gain did you net from that?
16:26
Hillary: Yeah, like around a million.
16:28
Frank: About a million bucks. Okay. So, and that was over what period of time? You bought it and held it for how many years total?
16:35
Hillary: Oh, three-and-a-half years.
16:37
Frank: For three-and-a-half years. Alright. So now, now you instituted the plan, it's obviously hugely successful. I mean, anyone would say making a million dollars in three-and-a-half years is pretty spectacular. Do you regret selling it or are you glad that you sold it? Because obviously that was a huge profit. So hopefully you still feel good about that, right?
17:00
Hillary: Yes. I do.
17:00
Frank: Okay.
17:00
Hillary: You know, I definitely don't regret it. Now I'm looking to buy another park because we, I was trying to do a 1031, but I didn't want to overpay, so just paid a lot of taxes. But it's good to know that I have enough capital now that I can really buy an even better park in the future once I find another good deal.
17:23
Frank: Okay. And let's just stop for a moment right there. So when you had this million dollar profit, any weird things you did when... I mean, what was your million dollar celebration? See, when I sold my billboard business and suddenly had a seven figure bank balance, I had this weird thing that I would call the bank almost 10 times a day, 'cause I loved hearing the balance. It had an automated recording, and I would just like call it and call it and call it, it was like weird. And then I got over it after a while. Did you have any other strange mannerisms that occurred after you cleared that much on the sale?
18:05
Hillary: Well, we ended up putting it like in a high yield savings account online. But I personally, I'd always wanted to like be quote unquote accredited, an accredited investor. So just thinking about that, I could be accredited now, that just always made me feel happy, just thinking about it.
18:24
Frank: Got it. So you've been kind of on a continuous happiness binge since that happened, right, for the most part?
18:31
Hillary: Right, exactly.
18:31
Frank: Okay. So now what, in the next park you buy, what will you do differently than the first park, if anything? Obviously, the first park was a huge success. So are you going to try and buy a similar park and just repeat that movie? Or any changes to your plan for the next one?
18:51
Hillary: Yeah, I mean, I'd love to find another park similar to that. Definitely some things that I wish we had done differently would be to raise the rent every year, no matter what the pushback was going to be. And then, they also had like a storage shed, a very large kind of warehouse, and we were just storing junk in there, like the previous owner had junk. We're like, okay. And we didn't want to rent it out as a storage unit to a resident, because a lot of people were asking. But then that last year, the person who mowed our lawn and snow shoveled asked if he could rent it out in exchange for free lawn mowing and snow shoveling. And I mean, that made such a big difference to our expense line. I just wish we had pursued that immediately. So like any opportunity to get more income on the property, I definitely will take advantage of that right away with our next one.
19:50
Frank: What about as far as size? Are you going to try and go for something bigger? 'Cause that size isn't bad. The size you had, that 40 lots, I mean, that's always been a good sweet spot. It's big enough that when you got it... Well, when you sold it, I'm assuming you got like... It sold for like a million, 7 million 8, which means it's plenty big that you could get a loan broker, you could get conduit debt. A lot of options for the seller. So are you going to look for something of similar size? Are you going to try and go bigger? What are your thoughts on that?
20:21
Hillary: I'm just kind of open to anything if the numbers work. Definitely don't want to go smaller. But it's just about what the deal looks like. And I'm not trying to put too tight of a box on it.
20:35
Frank: Yep. I agree. Yep. That's how we are. And then, geographically, what are you thinking? Like what part of America? Are you going to continue to look at the Midwest or Great Plains or Utah? Or are you changing that plan or are you going to just kinda look anywhere? What are your parameters on that?
20:56
Hillary: Yeah, I think, again, I'm pretty flexible, but I ideally would love to have a state that you can do one-month evictions, instead of like three months of nonpayment, 'cause that really could have made it hard, even to get one person evicted.
21:11
Frank: Sure, and obviously, you owned this during COVID, correct? Is that correct?
21:17
Hillary: Yeah.
21:17
Frank: And how did COVID work out for you? In our case, we were terrified because it had never happened before. We didn't know what would happen, but in the end, our collections ran pretty good and our sales actually increased. Is that what you had happen too?
21:32
Hillary: Absolutely. The COVID did not affect any of the rent. It would always just be like one stray person who was late. There's always someone who maybe is not a good payer, but it wasn't related to COVID.
21:45
Frank: Right. Okay. And then during the period that you managed it, did you have a manager on site? What was your management structure, management on site and then you're kinda like the general manager or how did you handle that?
22:00
Hillary: Yeah, so we had a greeter, who lived in the park. And then my husband was the general manager, so he would visit a couple times a year and do maintenance, and people would know him. And then I kind of alternated between like the head honcho that you had... The owner. And then also kind of the secretary who would listen to daily complaints or requests from residents when they called you.
22:26
Frank: Any lessons learned from managing the manager? Did the manager... Did you have to replace the manager while you owned it? Or did you still have the same manager from when you bought it to when you sold it?
22:35
Hillary: No, we... So at first, we chose kind of a busybody type of person who knew all the gossip, because the rationale was they'll tell us... They know everyone's business, so they'll tell us what's happening. But that really did not work out well, because we found that the residents would just call anybody and complain. So we knew it anyway. And so the next greeter was kind of a older couple and they would just, they would kind of pick up the trash as a matter of course. And they're just kind of a low key and it worked out much better.
23:15
Frank: Gotcha. So the managers, when you sold it, were some senior residents, I assume, that lived in the park, correct?
23:24
Hillary: Exactly.
23:24
Frank: And they weren't really in it for the money. They were just in it 'cause they wanted to make the place nice 'cause they lived in it, right, so they wouldn't... But yeah, right. Exactly. Okay, so and then what did you learn as far as just operationally, were there any big lessons learned where you said, "Ah, well, we're doing this wrong." Like for example, the one commercial building, are you thinking now in retrospect, "Well, I could have rented that." Are there any things now you look back from a management perspective where you say, "On the next park, I'm going to do this differently." Are there any examples of things that you want to do differently on the next one?
23:57
Hillary: That's a great question. I think... Well, two thoughts are coming to my mind. One is that, when I listen to all of your content, Frank, about your crazy dramatic stories about your residents, I thought, "That won't happen to me. I have this quiet small town park, nothing weird," but there were so many crazy dramatic stories that would happen. And so just kind of to be prepared for those upfront, and then people, some people are always happy, some people are never happy.
24:32
Frank: Right.
24:33
Hillary: So just understanding that going in. And then I also think the idea that even though the park that I bought looked really good on paper. I mean, even 34 occupied, all tenant owns, no rentals, no lease to owns, city water sewer, we never were able to get 30% expenses. And so just knowing that going in, that when you buy the park, you have to really be conservative with your initial bid, because something always seems to come up.
25:11
Frank: Yeah, you always have to give yourself plenty of fluff, right. There's no precision in the trailer park business, right? I mean, you never know what, you can have a pipe burst, a leak, tenant runs off, tree dies, so you gotta give yourself some fluff. That's one of the benefits of using First Secure is he likes to stress test deals by putting an additional 10% reduction in revenue or increase in expenses to make sure they still fly. So, yeah, you gotta have some fluff in there. So, how did you then... Did you use, like Rent Manager as a software or did you use like QuickBooks and Excel, or what was your... How do you internally manage this from a software and an accounting concept?
25:58
Hillary: Yeah. Just QuickBooks. And then just taking very careful records, keeping all the receipts, making sure everything is organized. When we sold it and we submitted the due diligence, our broker commented that this was some of the best due diligence he had seen. Everything was there, everything was organized. Rent Manager sounds great, but for just one park it seemed better to just save money anywhere we could.
26:30
Frank: Yeah. And so how much time would you say that you spent a week managing the park? And let's define that. In other words, you have the manager in the field and they're managing or whatever, and you go out there twice a year, so let's not count any of the manager's time or you going out there, but on a regular basis, like week to week on the 50 weeks you weren't there, how much time do you think you spent a week? An hour, five hours? What do you think?
26:57
Hillary: Yeah, I think it was around two hours, probably. So it wasn't very much. However, one thing that maybe surprised me a little is how much it was front of mind. So even though I wasn't physically spending 10 hours a week doing something, I was kind of thinking about things, worrying about it, anticipating this, responding to a tenant, so that it maybe felt like more than two hours, but it wasn't.
27:29
Frank: And you've not owned any other real estate, correct? In other words, you have not owned an apartment or a duplex or a rental home or anything else, correct?
27:36
Hillary: No. Not at all.
27:37
Frank: So, right. So you have no basis of comparison between the amount of time necessary in one of those, which is a more active activity than mobile home parks.
27:45
Hillary: Exactly.
27:46
Frank: So when you got, when the person made you the offer, when the broker called and said, "Hey, I've got someone who want to buy it," how much of you thought, "No, no, the plan was, we hold it forever." So how hard was it for you to overcome your original plan? In other words, on the one hand that you might've said, "Oh, no, it's not for sale. I'm never selling, I'm keeping it forever." Was there any part of you that said, "Oh, no, we gotta stick with the original plan and not sell," or how did that work?
28:19
Hillary: It was really easy to make the decision.
28:21
Frank: I would agree. Yes. I think it should have been, yes. I'm just checking to try and give guidance to others who would not be as smart as you are to sell. It's the old Warren Buffet adage that you sell when you would not buy it for the same price, and obviously you would not buy it for that price, because you had just bought it for a million less just three years earlier. So clearly, in your opinion, if this had been starting the movie all over again and it was Hillary out calling people and the guy said, "Yeah, I'll sell it to you at this price," you would've said, "No way, not a chance," correct?
28:55
Hillary: Exactly. Because my rationale was I can take this million dollar profit and kind of buy maybe a worse deal and I'll still get more income from it. So I'm just trading up.
29:08
Frank: Okay. So then, did you have any... When you raised the rent... When you put the Metron meters in and you billed the utilities back, and then you raise the rent, did you get a lot of pushback from residents? Did people say, how dare you? Or were they just kinda, yeah, whatever, it's reasonable. How much negativity did you get?
29:30
Hillary: We got some, but it ended up just being the same people who were dissatisfied with everything.
29:36
Frank: Exactly. And quantify that for people. So you had 30-something residents. How many were your troubled, hating life on everything residents? Like three or five? What percent?
29:49
Hillary: Exactly. Three or four.
29:51
Frank: Yeah. It's always, you have this in every park, you have this 5 to 10% group that they hate change. They want everything to remain crummy and cheap, and they do not reflect the majority of residents. It's just, they're so out of whack it's crazy and so you just kind of gotta ignore them. 'Cause we have those every day. We have the same people who complain. It doesn't matter what. People complain when we do good things, bad things. And then at some point you realize they just complain about anything. You could've done none right with those people. You could've said, "Hey, great deal, I'm giving everyone a $5,000 Christmas gift," and they would've said, "Why not 10? Why not 20?" That was kind of the deal.
30:35
Hillary: There was one resident who complained that we removed some weeds by a lake. It's like, they're weeds, we're doing you a favor by removing them. Or we removed a dangerous tree, but it somewhat disturbed the garden. So then they were really upset about that.
30:54
Frank: Yes. And we've had the exact same thing. We've taken down dead trees and people said, "I liked that dead tree. It was kinda sculptural. I liked the way that it looked, it looked like my ex-husband," or whatever. And we're always like, what are you talking about? So, yeah, I know. I'm fully aware that people, they just don't like change much. But again, it's always just a very small group.
31:12
Frank: So what's next for Hillary and her husband? What's the future plan? Are you going to try and buy one more park? A portfolio? Are you going to build a REIT? What is the, obviously you had a fantastic first park, so you have a great trailblazing initial story, so you would be able on that to raise money. Even beyond your own money, which you have plenty of money now to buy whatever you want, but you got a great story, but so how big do you want to be? Obviously, you like being a piano professor. So what's the plan? Is this always going to be just a kind of a side hustle, sideline income source while you continue on with piano? Or are you going to ultimately ditch piano? Or are you going to go do piano? You and your husband become Captain and Tennille and go to Europe and start your own restaurant, or what's the ultimate plan, do you think?
32:16
Hillary: Yeah. Well, right now the plan is just to one day at a time try to find another deal. And if it pencils in and if it's good, then buy it. And ideally to try to get as big of a park as I can, or... Use all the money. Use all the money to buy more parks. I love my job. I will always be a pianist, and I don't see myself quitting my job ever just to do real estate. I see it more of like a financial freedom kind of a thing and I can give money for my children and I can just be comfortable while already kind of doing what I love the most, which is...
32:58
Frank: Right, and you can still have some fun with the money and it won't stop you from buying.
33:01
Hillary: Exactly.
33:02
Frank: Like you can take some money, use it as a down payment on a different house, a car, right? So it helps in every regard, right? It's not just capital to buy parks, but it can fund all kinds of stuff, right?
33:14
Hillary: Like we're finishing our basement.
33:15
Frank: There you go. Or tried to buy another Steinway or something, right?
33:21
Hillary: That's right.
33:22
Frank: So, when you first bought this park, I assume you probably had lots of friends and family who thought you were insane, right? I mean, here you are, you're a piano professor and you're about to buy this mobile home park for seven hundred and something thousand dollars, it's got to scare the crud out of everyone who knew you, I assume, right? I'm sure your parents were like, "Oh, my gosh, this is nuts. You're crazy. It's dangerous." Did you have any pushback like that or did you not?
33:46
Hillary: For sure. Yeah, well, so both of my, both sets of my grandparents owned successful small businesses. But as a result, my parents would tell me, "You know, you're buying yourself a job. You're going to work 24 hours a day. You're going to be stressed out," because that's kind of what happened when my grandparents were alive. And so I tried to tell them, "You know, I don't think it's going to be like that. It's going to be okay." And then after going to the bootcamp, my brother came to the bootcamp with me, and then after we both came back and we told my mom, "It's going to be great, it's okay." And then she was, she came around and was convinced that it was going to work.
34:26
Frank: Right, and clearly now, what do they say now? I mean, when you, I mean, you're a piano professor that made a million dollars on a side hustle. What did they, surely they have to say, "Oh, my God, that's the most amazing story of all time," right, I mean...
34:38
Hillary: Yes, absolutely. They're super supportive.
34:41
Frank: Right, and then what do people say, do people at the college know you've done this or is it something that you keep quietly in the background, or I mean, or do you have other people that you've said, "Hey, you know, I bought this mobile home park and it's gone incredibly well." Did you have any other peers that you knew of that you told your adventure to as you went, or how did that go?
35:04
Hillary: I tried kind of not to tell anyone. At one point, there was a marijuana farm right by the park, and I was very distressed about that. It ended up being fine. No problem. So I kind of told a couple people at work, but not about the financial gains or anything like that. And I try not to really tell... I don't see my life significantly changing in terms of spending because of it. It's more of an investment. So, just kind of living my life.
35:38
Frank: Okay, and what were your three best days as a park owner so far? Obviously, the best day was when you sold the thing and put a million bucks in the bank, but what were your other two days where you thought, "Wow, that went way better than I thought," or something? Did you have any other experiences where maybe you helped somebody or someone said, "Gee, Hillary, so glad you bought the park. 'Cause I was, you know, in a terrible situation and you gave me a good place to live," or do you have any happy stories, other than the money in the bank?
36:04
Hillary: Yeah, for sure.
36:05
Frank: What are your two favorite stories from the park?
36:11
Hillary: So one is there was a woman who applied to buy one of the park-owned homes, and she was recently divorced, an older woman. And she said, "Look, my credit's not good because I don't have a good credit score because of my situation. I don't have a lot of money, but I have a good job." And so we we vetted her, and even though she maybe wouldn't have qualified, we took a chance, and she fixed the home up incredibly immaculately. There was a garage and she had this really nice car for the garage. She really, it was just wonderful to think that we could have provided her with a safe place to live. And then she ended up selling the home for a huge profit and moving somewhere else. So it was like a win-win for everyone.
37:00
Frank: Sure. And then, what were some of your worst days? Like what was the worst day ever as a park owner where you were like, "Man, why'd I buy this thing?" Right? I mean, my first park, Glenhaven, it's well known my worst day ever, I lost the natural gas in the dead of winter, and suddenly I have all these families calling me up, saying, "Hey, I can't cook. I got no heat, you know, what do I do?" And I don't know what to do because I'm just a newbie park owner with no clue. Did you have any bad days where you're like, "This is stupid, I hate this business," and then what were those?
37:35
Hillary: Got it. There were quite a few of those. One was just when we were able to evict someone after a long time and just found the house gut remodel. I mean, mold, holes in the floor. It was just very sad. And then another was when just I tried to be nice and like fiber optics, cable, they wanted to have high speed internet. So like I paid for a surveyor to come and mark the lines. And I did, I just with our own money, we paid, then they came in, installed the fiber optic lines, but then they hit a sewer line and nobody knew about it for a while.
38:16
Hillary: And then apparently, six months later, we get a call. "My house has had three inches of raw sewage for the last six months." And even though, we paid for a plumber to come look at it, like, they wouldn't let the plumber inside the house or something.
38:30
Frank: Yep, I've been in the same movie.
38:32
Hillary: And then they were trying to sue, so we ended up having to pay them all this money, so that was like trying to do a good deed, and it really came back.
38:39
Frank: Did you go back to the people who installed the fiber optic on that? Because if they hit the sewer line, they should be in the loop.
38:48
Hillary: They just, no proof that they hit it. There was nothing we could do. We had signed a waiver, so there was nothing that they were going to give us.
38:57
Frank: Right. And probably the resident was what we call a systems user, right. So, I mean, when you have somebody calls with a complaint and they won't let you go in the home, you always wonder what in the world's going on. We've had that where people call in on any number of utility issues and then we send someone there and they refuse to open the door and then they call us again, it doesn't work. And we're like, "We sent someone there, you wouldn't open the door." So there's maybe a 1% of truth in this story, right, probably 99% of expansion, right?
39:25
Hillary: Exactly.
39:26
Frank: So if we had John Oliver or someone on here, of course politically in America's political climate, they would say that you're obviously an evil person because you raised the rent and therefore made a lot of money, so therefore you must be inherently evil. What would you say to someone who says, would say that to you? 'Cause I get that, people tell me that all the time. What would you say to someone who just said, "Hey, Hillary, you're just a horrible person. You should have lowered the rents and how dare you make any money?" What would your answer be?
40:00
Hillary: I would say, I would have no problem having my mother retire in that park.
40:04
Frank: Sure.
40:04
Hillary: I would have no problem living in that park. We made it safe, we kept it clean and we weren't the ones that offered the money at the end of the day. Someone else did.
40:16
Frank: Sure. Right. And then the other part of it is, I assume like any park, if the value of the park grew that high, that fast in a small town like that, when you're in a big metro and in a small town, I'm assuming like, what was the median home price there? Give us an idea of what the median home price was.
40:35
Hillary: It was like 110.
40:37
Frank: Okay. Right. So, but, at some point the mobile home park, I mean, let's just look at the numbers the guy had, he was losing money, right, on paper. So if he went out to market saying, "Do you want to buy my mobile home park, I'm losing X," no one would buy that. The average person would not buy it, right. And even if he had found someone who said, "Yeah, I'll buy it," and they went to the local bank, the local bank would've said, "You're nuts. I won't do it because it's losing money." And so it would ultimately probably have been torn down, right. I mean, you see those articles all the time in the paper of parks being redeveloped because the park either made no money or lost money, or it's only made a small amount of money that someone says, "Heck." I mean, I assume that your landmass on 40 lots, you were probably, what, you were probably like four acres, something like that. How much land did you have?
41:28
Hillary: Yeah.
41:28
Frank: Right. Which is, it's a perfect pad size for any number of users. Four acres is ideal for everything from a McDonald's to apartments, to you name it. So I mean, if you had not stepped in, it could have just been torn down, right? So basically when people...
41:47
Hillary: Absolutely.
41:48
Frank: Yeah. So when people criticize you for bringing it back to life, you were the catalyst, you were the grain of sand that made the pearl, because the new person would have never bought it in the condition that you bought it, right? So you were, you saved the day, 'cause you went in there and took something that was failing miserably on paper and then you brought it back to life, raised the rent, did the water sewer, made it where it was worth more than the land value, then the new guy bought it. And now that the new guy person bought it, he'll never redevelop it because he's got a lot of money in it, and it's probably not worth more as raw land than what it is. But had you not stepped in, it would've been destroyed.
42:21
Frank: I mean, the way I look at this stuff is just like the shows on HGTV, like Bargain Mansions, where they go in and buy these abandoned homes in Kansas City for like 50 grand, put 100 in it and sell it for 200. And you could criticize the person and say, "How dare you do that? You took a $50,000 house and made it an affordable 200, but you couldn't live it anyway, right, at 50, 'cause it's condemned." So I think that's kind of what you did is you were just the interim catalyst between the raw product which was worthless on paper to the average investor, and then you took that, basically took some ingredients and baked a cake out of it in your bakery.
43:01
Hillary: Exactly.
43:01
Frank: And then the new person bought the cake. That's how I would explain it to people. And because you were very smart on how you built and bought and sold the cake, you made really good money, just like a bakery that sells a really expensive wedding cake because of their expertise in baking really good cakes and then in marketing them and doing them at the right price, right. So that's kind of what I think you did.
43:21
Hillary: Yeah. And after, so originally it was named after the person who had developed it, who was still living in the town. And when we bought it he contacted us and said, "Please change the name." Like he didn't want his name associated with the park, so it's like, now I think it would be great, be proud to have your name associated with it.
43:43
Frank: Right. Yeah. So basically it's a win-win story, 'cause the residents benefited because you made the place nice again, the seller benefited because he got a good price for something that was a mess. You obviously benefited. And then even the new guy that bought it benefited, because even though it's a price higher than you might pay, he'll continue to raise the rent, he'll fill up the other vacant lots. So in the end, it's just your classic Disney win, win, win, win ending for the most part. No-one ended... Actually, there was no loser in the whole movie at all, right. Okay.
44:16
Frank: And well, I gotta tell you, Hillary, we had to have you on the lecture series because many different things. Number one, you were extremely young for being on the lecture series. I mean, it looked like you're probably one of our youngest people ever. Number two, we've just never had anyone who was a musician before. So this is unique. And then number three, it's such an inspiring story for people because you're, it wasn't like you had spent your whole life trying to get into real estate. I mean, you just kind of happened into this, learned what you were doing, applied the knowledge, executed on it, were smart enough to know that it was time to sell it, smart enough to know that that was a good price to buy it. And now you move on.
45:00
Frank: So I think this, in a time when America is kind of getting to be a scary place, this is a really nice, inspiring story of someone who just was smart. And that's about it. I mean, there's nothing, it isn't like you were opportunistic. It isn't like you had a brother-in-law deal from a relative. I mean, you just basically, you had a plan, you stuck with it.
45:23
Hillary: I mean, I'm really just, if I can do it, anyone can do it, honestly.
45:26
Frank: Yeah. Well, I mean, again, Brandon and I thought that this was a remarkable story that needed to be told, particularly at this time in American history, because again, a lot of people out there, like, other investments don't work at all, other real estate doesn't work at all. You can't really flip houses anymore. I mean, we all know that office and retail and lodging are collapsing as we speak. And so it's just kind of good to hear someone who got into the mobile home park business as you did and did so well at such a short span of time. So we highly commend you for doing that.
45:58
Frank: And then we also highly commend you for coming on here and sharing your story with people, because our industry is built around this feeling like we're almost some kind of a fellowship, right? Because the number of park owners are so few. Like, do you know any other park owners other than yourself? I mean, is there anyone else you know in the world who's a park owner?
46:19
Hillary: Well, the last six months or so, I've been looking at Twitter and there's quite a few people on Twitter, but that's kind of very recent.
46:26
Frank: But I mean, prior to that, like in your universe of people.
46:29
Hillary: No, not at all.
46:29
Frank: No, you're the only one, right? So it's always fun as a park owner, 'cause it's kind of like you're in this weird little niche hobby, like, I don't know what, like super advanced model railroading or collecting some kinda weird car like the Corvair or something. So it makes it kind of fun talking to other people. So again, we really appreciate you taking this time out of your evening here to be with us. And I think a lot of people got a lot of good value out of this. And again, we really, really thank you for being here. I know a lot of people, if we had a little chat box on here, would be saying, "Thanks, Hillary for giving us your thoughts." So again, we really thank you for being here.
47:05
Frank: And again, that concludes this lecture series event. And we hope everyone learned a lot. I know I certainly enjoyed learning myself from this story. It's a very fascinating story. So thanks, Hillary, for being here. Thanks, everyone. We know y'all have other uses for your time. We were pleased you were here with us and we'll see everyone again soon.