A Day In The Life of a Mobile Home Park Owner

What is the time and travel commitment required to buy and own a mobile home park? Is it possible to own a mobile home park without disturbing your successful day job? These are the questions we are going to answer on this recording!

We’re going to discuss the actual time commitments of 1) buying 2) performing due diligence on 3) turning around and 4) operating a mobile home park. We’re also going to review what those tasks are and how to manage them correctly.

The speaker is Frank Rolfe who, with his partner Dave Reynolds, is the 5th largest owner of mobile home parks in the U.S. – but also started out with just one property and knows exactly what the time constraints are whether you’re buying a single park or building a portfolio.

A Day In The Life of a Mobile Home Park Owner - Transcript

Welcome to the Mobile Home University lecture series event titled A Day In The Life of a Mobile Home Park Owner. This is Frank Rolfe. I'm glad that you're here. We get a lot of questions here at mhu.com and some of the most prominent we've held lecture series events on in the past, one of which is how much money do you really need to get into the mobile home park industry.

First, the obvious answer is, like all real estate, roughly 20-30% down on the purchase price, but there are, in fact, three ways you can do it for zero down. One, selling assignments, two, doing zero down deals with mom-and-pops, and three, doing master lease with option.

Another common question we get is how much cash flow can you make from just one mobile home park? Again, the answer is simply you would be able to make whatever the number of lots times the rent increase you're going to be doing in the future, plus whatever vacant lots you're going to fill.

If you were to buy an 80-space park that basically just covers the mortgage and then raise the rent up $100 a month over, let's say, a four-year period of raising the rent $25 per month each year, that would yield about 100,000 of cash flow.

So that one, we've dealt with in past lecture series events. But this one's more interesting. This is the matter of time, very common question from people, people with successful careers, day jobs who don't have a lot of time to devote, and they want to know how much time you really need to buy, do due diligence on and turn around and operate mobile home parks?

So that's what we're going to be covering tonight. Following this discussion, we will have endless Q&A, so we'll be set up for live Q&A, so get ready for that at the end. Now, let's start off with the first function of most people in the mobile home park business, and that's simply having a mobile home park.

What do you do and what is the time constraints to find a mobile home park to buy? Well, let's go over what those steps would be. The first one is learning how the mobile home park business works. And to really succeed in that regard, you've got to be able to put all mobile home parks in one of two boxes.

A, this deal might work box and this deal has no chance of working box. What would separate the two boxes are the infrastructure and the density and the economics and the location. And so how do you learn those things? Well, first one would be to go to Boot Camp. Not to be self-serving but we, in fact, are the only legitimate course on the industry in existence and have been that way for a decade.

We've had probably every major portfolio owner and virtually every new buyer in the industry has been to Boot Camp. So there's one. That's a three-day immersion weekend. Or if you can't spend the three days, you can obviously take our course from your home.

And if you don't want to spend the money to even get the course, you could just become a voracious reader of everything you can find on the topic of mobile home parks, all the articles, all the podcasts I do. You could Google up articles from other people. You could even go talk to other old mom-and-pop owners of parks.

They could tell you what their thoughts are. Once you've done the educational part, it really never ends. I myself am always constantly reading and trying to learn from other industry sectors, from old books I can find on eBay and Abe on the mobile home park industry, any kind of business leadership book, military strategy books, you name it.

Everybody needs to learn. Anyone who thinks that they know it all knows nothing because you never stop the learning efforts. And if you do stop your learning effort, typically, you get behind the times and you ... often sadly enough like some of the mom-and-pops you buy parks from home.

Once you've got the knowledge down, I leave it up to you how much time you devote or how you do that. Then comes the task to try to find a park to buy. So what do you do and what are those time constraints? Well, the first place, most people look for a mobile home park to buy is on the two websites.

That's the easy way out, Mobile Home Park Store, number one, typically, 800-2,000 listings. And then you have LoopNet which has mostly the same listings, but they have some additional. There's no overlap. But you always have way more listings on Mobile Home Park Store than you do on LoopNet.

And that's simply because LoopNet's harder and most mom-and-pops are not very good with the internet. So how long does it take you to surf those listings? Well, most people like to buy their first mobile home park in about a four to five-hour radius from their home.

And you do that because for most people that make you feel like you have control, so the very thought that you can get in your car and drive there and be there in four to five hours, which means this model that you leave at 8:00 in the morning from your house and you arrive at the mobile home park at noon.

You leave the mobile home park for a few hours and you're home by 6:00 to eat dinner. No one even notices you were gone mostly. So that being the case, you can look at all those listings on Mobile Home Park Store and LoopNet and you can bake them into two categories within the four to five-hour radius of your house and not.

And then you can focus just on those that are within that drive radius. You can then contact the brokers, contact the sellers, learn about the rest and you can see if any of those work. That's where most people start. And it's so darn easy. It tells you all the mobile home parks, family lots, what they're asking, typically the rent level.

Sometimes even photographs, things like that. Now, what else do you do? So that's one way to do it, but we all know the listings on Mobile Home Park Store and LoopNet, some of those things are no good locationally, or infrastructure, and the prices are typically sometimes high. What else would you do?

Well, the next thing I would do is I would definitely talk to brokers. If you go to Mobile Home Park Store, there's a broker tab and you can then get a list of all the industry brokers. There's literally over 100 of them, the most prominent of which are Marcus & Millichap, Sandstone, Miller, Hoffman.

There's quite a few firms and each of those firms yield sometimes five, even 10 mobile home park brokers. Talking to brokers would basically revolve around calling them all up, introducing yourself, telling them what you're looking for, and then building a database of their numbers and their emails and their addresses, sometimes call them, sometimes email them.

You can even occasionally be different, send them a letter, postcard, whatever you want to do. How much time commitment is that? Well, it's not huge. The initial call, yes. If you were able to call every broker in the US, all 100 of them, and you talked to each of them for six minutes, that's 600 minutes.

So that's about 10 hours of time on the initial four sets based on obviously very standard basis. Even if you wanted to, you might be able to reach how many? One or two a day? So you're really looking at not a huge time expenditure.

Then after the follow-up, sending emails, doesn't take a lot of time. Follow-up calls, these typically are not super time-intensive. So that's not going to be a whole lot of time on that. But let's say between those two steps, looking for listings on Mobile Home Park Store and talking to brokers, most people could probably perform those tasks within probably about an hour a week.

So that really is not a huge time commitment. Now, the next item, if you want to have a bigger time commitment, would be if you got more aggressive and did direct mail or cold calling those moms and pops. Now, let's assume that it takes you, on any given cold call, five minutes on average to call, and that's an average between those who answer the phone and those who don't.

Then if you said, "Well, I'm going to devote an hour three times a week to cold calling," then you'd be able to do probably about 40 calls a week. If you did that smart, if you worked smart, if you took the parts that were within the four to five-hour radius in those markets that you like within that four to five-hour radius inside your circle, you could probably do a very concerted effort that would probably pay fairly large dividends.

And the same with cold calling ... I'm sorry, same with direct mail. You could go after those parks that are within your territory in the areas you're most desirous of your territory, the ones with the highest home prices and departments. And you could probably amount a pretty good offensive on those in a span of maybe about three hours a week.

If you're looking to buy a park, I'd say that you need to spend ... If you want to have a good effort between looking at listings, talking to brokers and a reasonable effort ... Now, this isn't a killer effort. Obviously, there's some people out there who might spend three hours a day cold calling and sending direct mails and talking to owners.

But I think you could do a somewhat adequate job if you would simply devote a very focused three hours to that effort. Basically, I think about four hours a week would get you a decent amount of action on finding the mobile home park to buy.

Now, what about the due diligence? Let's say you find the park to buy and you establish a price with mom-and-pop, and now you move on to due diligence. There's a lot of misconceptions on due diligence. Part of that is probably from the fact that we mostly think of due diligence of being something that has to be done in person.

But with mobile home parks, there's not a lot that's done in person, and when you do it, you can be very effective on your time. How do you do it? Well, one of the items you definitely got to have when you buy a park is our due diligence guide, because it tells you all the things you have to do during due diligence.

I think the best way to do due diligence is to get a three-ring binder notebook, dollar store, grocery store, office depot. And then you get a whole bunch of what I call sleek sheets or plastic sheet protectors, depends, I guess, what decade you went to high school in.

And these are these plastic items. They're sealed on three sides, and then you insert your 8.5 by 11 paper or whatever else you can insert in there. You put it in a survey of whatever you want to do in those. And if you number those to correspond to the due diligence guide, it makes life so much easier.

Because then, what all you have to do is a very simple task. You have to find your appropriate item and put it in that plastic protector. It takes the scary concept of due diligence and makes it into more simple, bite-sized task mission of filling that thing up.

Then what you do is you basically put on your white lab coat like any good scientist, and you focus on nothing more than you are going to scientifically, completely, without any tainting of your personal preference, put those items in there and not even redo them until basically you get done.

Now, you'll find as you start to do that, that many of these items that you need to obtain, you will not obtain in person whether it's the market comps, which means calling the other parks to get their rates, or the certificate of zoning, which you get from the city.

But they're not going to do it in person. They're going to have to type it and email it to you or mail it to you. All these different items you'll see in there, well, they're all done by phone or mail from your home or office. So not a lot of time spent on this.

Most of those steps or items the people are spending time on. When you ask for the certificate of zoning from the city, you don't write it, you don't research it, you don't type it. You just receive it. When you call the water department to get the last three years' readouts of the bills for the park, you don't put it together.

They just send it to you. So a lot of that is you delegating work to other people. There's not really that...

All right, so rolling back, you've got a whole bunch of items that you delegate to to create the effort, but it's not things that you have to do. All you're doing is gathering these various items and putting them in the book. Now, that doesn't mean that there's not some time expended.

But it's not a huge amount. So I would say if you're building a due diligence book, you certainly would not spend, I would think, on an average, a day for the 30 days more than about 30 minutes a day. So again, not a huge time commitment.

Now, there is one additional piece though that would take a little bit more time, and that is taking the trip out to the property. So how do you do that? Well, what you do is you go to the property. I think the weekend is perfect for it. So again, no one will know from your day job.

It will not interfere with your personal life. Just go out there on a weekend trip and when you get there, what you want to do is you want to walk the property both front and back, making a full inventory on what's on every lot, taking lots of photographs so you don't have to memorize anything.

There's no reason to memorize today. Go with a smart phone, just take any number of videos or photos of every single home in there, anything so you don't have to memorize it. While you're there, you want to find which are the nicest homes because those are your future manager candidates, which is critical.

So that's what you would do on that. You go to all the competing parks and see how are they doing? What are they like? How do you stack up against them? And then you want to spend a whole lot of time getting comfortable with the market. So you're going to go and you're going to go to the mall.

You're going to go downtown. Are the stores opening or stores closing, or are factories opening, are factories closing? Just your general feel for the market itself. This is not something you do repeatedly. Some people think you go out in this property and then you go out the next week and visit again. No.

That's completely overkill, to be honest with you. Once you've seen it, once you've walked it front and back and got a good handle on the market, of course, you'll probably go out at least one more time before closing. But from a diligence perspective, you can do it all in one very efficient trip.

Now, another thing you're going to want to do while you're there is you want to go visit the park both day and night. You don't want to just go at one time because parks have different personalities on day and night. And you want to see the demographics of the customers you'll be inheriting, their lifestyle, what they're doing.

You can be very informed if you go to your property at night and just see what's going on. So I would urge you while you're there for that weekend, you go to the property several times. Every time you go, you'll see different residents, different things going on. So you would definitely want to go out there.

Then what does it mean on the due diligence side? Well, it means you spend probably about 30 minutes a day, progressing to put things in your due diligence manual. And then obviously, your one or possibly two trips to the park, the second trip is just to make sure that you didn't miss something from the first and just normally to make yourself feel comfortable.

But again, not a big time commitment of being on-site. Some people tell me, "Well, I guess I'll have to go out there to the park for a week." Well, absolutely not. There's no reason you would ever go to the park for a week. It makes no sense. If you can't get everything done on site within two days on a weekend, then you're just not being efficient enough with your time.

Now, let's talk about turning around the park and the time commitment required to turn around the park. Let's say you've now purchased the mobile home park, and when you purchased it, there were certain things that you wanted to do to make it a better place to be.

So how do you then do that? Well, the first thing you do is you make a list of all the items that you want to improve on. That's the initial item, and this list would typically include such items as installing white vinyl fencing at the entry, putting up a new entry sign and all new signage throughout the park, removing any dead tree, dead tree limb, pothole repair.

Or if you're going to go a step beyond that, more complicated roadwork, fixing any broken sidewalks or any other safety hazards. Fixing or removing the coach lights that many parks have in each individual lot, painting and updating common area structures, renovating park-owned home, renovating privately owned homes that are dragging the park's aesthetics down.

Installing dumpster enclosures or converting to curbside or removing the dumpsters, removing debris from the property, removing non-running vehicles, installing new common areas like playgrounds, pavilions, picnic tables with grills, and installing primitive fencing if you have to do that.

Some parks, you install primitive fencing as an additional safety item or aesthetic item with the neighboring property. How much time does it take to do things like that? You've made your big list. Well, it's probably going to take you a whole lot of time because once again, you're not doing the work. You're managing the work.

So how will you do that? Well, the most time-intensive part of getting all those things done will be finding the vendor who can do that. That's the key item. You're going to contact vendors and you're going to do like the Henry Ford assembly line.

You're going to call them and you're going to say, "Hey, I need to paint six homes," or, "I need to skirt three homes," or, "I need to remove six trees," that kind of a deal. And typically, you'll get three bids for each and you'll have a turnkey price, parts and labor.

Never do a deal that does not have any turnkey price. And then once you've established a turnkey price, now, you're in the simple mode of managing the project from beginning to end. So how do you do that? Well, in the old days, it was rough.

You wanted any photos, someone would have to shoot them with an old box disposable camera and take a one-hour photo. But today, of course, you have your smart phone. So what a lot of people do to manage projects like that is they spend about 10 minutes a day calling the manager and just saying, every day, sometimes you call them twice, "What are we doing today? At the end of the day, what got done today?"

Other people will just prefer to call them one time and they just say, "What got done today?" If you figure you're going to spend 10, maybe 15 minutes a day by phone, that's not a huge commitment. And then additionally, as those contractors proceed, you're going to want to probably call the contractor and say, "How's it going? What's the timetable? Send me some completion photos."

They'll also want to get paid and you aren't going to want to pay any of them until you've seen the actual photos of their work, which could come either from the manager. It's preferable to come from the manager so they don't cheat, but also from the vendor themselves.

So really, turning around a park is not as complicated as it sounds. Once again, if you're very smart with the way you use your time. If you just run here and there like herding cats, yes, it would be a complete mess and nightmare.

If you didn't have a firm written bid, if you didn't do a Henry Ford assembly line style, if you just got way too heavily involved, if you didn't try and do it based on photos of completion, so you never knew what actually got down, so you'd be stung constantly with vendors lying to you, yes, it would be a nightmare.

You could spend eight hours a day and still not succeed. But if you can simply organize it into batches and then, just like Henry Ford would do, in a very organized fashion, attack those batches and the entire time, get a continuous information feed from the manager, and from photographs, and from talking to vendors, then it's really not that hard.

In fact, every time we buy a park and go to do the turnaround, I'm always amazed at how simple it is. Now, of course, it gets more simple the more times you do it. And the first time you do it, it's a little scarier, so it seems a lot harder and it seems to take a lot more time because you're not really enjoying it.

But as you proceed, you'll quickly realize that once I want to paint six homes on the exterior and I find a contract to paint those six homes, and I figure out what colors I want those six homes to be, then I'm not really painting those homes.

So thereafter, all it's going to be is maybe a phone call and some photos and they say, "It's done," and I cut a check. So you can have a very, very complicated turnaround. And we've done some real doozies. The park we turned around in Decatur, Illinois.

One of the roughest of all time. We bought the park for next to nothing because it was showed so terribly that it was hard for anyone to grasp the idea that it could be turned around. And yet, we did a massive amount of work there. I'm going to say 20-30 dumpster loads of debris, many, many homes demolished, significant tree work, significant roadwork, all kinds of items.

But nevertheless, it all worked out and it worked out well. So you can turn the park around. It's not a huge time commitment. Although, it sounds like it would be or that it should be, as long as you are a good manager of your time, use your smart phone effectively, that's not going to be a huge drag on your schedule.

So let's then move on to the recurring items. Those are all non-recurring items. When you're looking at buying a park, finding a park, doing the due diligence on the park and the turnaround of the park, those aren't typically items that come up over and over.

For many people, you own just one park and you don't even ever do it again. Others may buy over time, three parks, five parks, 10 parks. But that's a one-time time commitment. But then there's a whole another stat which is what I wanted to talk about, which are the regular recurring time requirements of owning a mobile home park.

So let's start off with what are the main things, as a park owner, that I am concerned about. And there are basically five gauges on my park owner dashboard. One is collections. That's basically the money. Did we get the money in from the residents? Number two is occupancy.

Do I have the number of residents that I hope to have? And am I working diligently to fill any vacant home or vacant lots that I have? Number three, water sewer. Where is the water sewer going? If I'm in a situation where I'm trying to get the water sewer recaptured by billing back to residents, am I succeeding?

Where is my water sewer? What is my bill now compared to the same month last year or just last month and constantly looking for any potential leaks in the system. The fourth gauge, property condition. I need that property to look nice. I need it to look nice for many reasons. If it does not look nice, I will not have good resident retention, I will have trouble attracting people to want to live in the park and buy or rent my vacant homes. I'll also have trouble with the city. City hall will not be happy with me. I may get cited for violations of city code.

My bank won't be happy with me because they'll drive to the property and say, "Why did we make this loan? This guy is a terrible operator." And I'll miss opportunities to potentially sell the park down the road to another buyer who will say, "Well, that's an ugly property. I wouldn't want to own that."

And if they do want to buy it, I'll get punished when they do the appraisal because it won't look very good. So you've got to have good, solid property condition. The final gauge, I call budget actual difference or BAD. This is the perpetual comparing of your performance monthly versus your budget.

So you see if you're generally on budget or if you're not. What do I have to do to monitor these five gauges? That's the big question. How much time commitment do I have to keep this car running, this park running properly given these five gauges? What do I do?

Well, let's go over first the daily task schedule as a park owner. Well, the first task of any park owner, because you're in the money-making business, is money. That means you have to daily watch your bank account and make sure that the money is coming in.

It doesn't mean you have to go get the money. Typically, your money is going to go to the manager to be deposited. Sometimes they'll mail the money to your own PO box and you deposit it. But nevertheless, the very generalized idea of money that is very critical to you.

Because without money, you're not going to be able to succeed. If the money is not coming in, you won't be able to pay your bills, won't be able to pay your mortgage, your financial statement will be a wreck, nothing is going to work well for you. So you've got to make sure at all times that you know where the money is.

Now, it's not an audit. It's a warm, fuzzy feeling but you've got to know what is going on with money. Second daily item is you've got to be available for the manager to call if they need to call you. I'm assuming that we are not self-managing the mobile home park at this point, but that you've hired a manager and you're more of a passive owner.

That being the case, then the question is when the phone rings from the manager, I need to talk to them. Now, we have parks that we never hear from the manager. We have other parks, we hear from the manager sporadically. And if you're in a turnaround mode in a tough park, scramble park, you may hear from the manager frequently.

The time commitment is something based on how long you talk to them. Often, they just want to you as the sounding board. Often, they just need a friend to commiserate with on what's going on at the park. Sometimes they have actual tangible questions. They don't know what to do with.

You could let them talk to your manager, but that isn't going to get you very well. So instead, talk to the manager but keep it at a minimum. You're not trying to forge a friendship. You're simply trying to manage the mobile home park.

So when you get a call from a manager, if you're spending more than five minutes or 10 minutes with the manager on the phone, you're doing something wrong because the manager is calling you to say, "Hey, it snowed a lot. Should I call the snow plow?"

And you say, "Well, how many inches did it snow? And send me a smart phone photo or okay, send it in," that's not going to be something that should be a one and a half hour conversation. So you want to keep those to a minimum because you really don't want to really forge a friendship with the manager.

You want a more ... You want to be respectful, you want to have a good working relationship, but you don't want to waste a lot of time. Finally, every park should have a helpline. And what a helpline is this is a backdoor for the resident to contact ownership in the event that something's wrong with the manager.

Let's give an example. Let's assume you've got a rental mobile home in your park and there's someone living in it and you just assume it's all going great. And they contact the helpline and say, "Hey, my air conditioner hasn't worked in three weeks and I told the manager every day for three weeks, they've done nothing."

Now, that's information you need. If you didn't have that information, you lose the customer, you might end up being sued, and you now know the manager is not really working out. So the helpline for most people is not answered. It's not live answered.

It's a refrigerator magnet, it's a number given to them maybe in an invoice, it's a number as well as an email address. And they can then contact you by phone or by email, whatever they want, if they have a problem. Now, if you don't live answer them, so the numbers that come in, all the calls are transcribed and then all the emails are obviously already transcribed.

You can read these and you then forward them onto the manager, which gets you in the loop of seeing what's going on. Obviously, you would not forward what is regarding the manager if they've done something really bad. Someone told the helpline, "Hey, the cops were at the manager's house yesterday."

That's not something you would forward. It's something that you would act on. But it gives you the ability to oversee what's going on. Now, how many calls do you get? Well, we've got a portfolio of about 20,000 lots and we hold a helpline call every week to review helpline.

And any given week, we typically get 75 calls. So we're getting about 15 a day, but we've got 20,000 lots. If you just break that down numerically and reduce down the quantity there, if you have a 200-space park, based on those kind of stats, it would be very, very few helpline calls.

Certainly not so much that would take a big amount of your time and that's per week. Let's look at the daily mass now. So watching the bank account to see if the money's coming in, that's not much. Checking your account balance every day, that's not a big time commitment. 10 minutes maybe.

Being available for manager to call. They rarely call you that frequently. Let's say they call you twice a week, which would be overkill, at 10 minutes a pop, you've got 20 minutes there. So we're at 30 minutes for the week. And then reading those helpline calls or emails, again, not much time commitment there.

Let's just say you could do all three of those in the span of about an hour a week. Probably, it's not a big use of your time. So then let's drop to the weekly duties, so what I have to do weekly. Well, many owners like to talk to the manager weekly, a very rigid schedule.

So often, it would be for Friday afternoon for 10 minutes, and you can also do this by email. It's up to you. Some people prefer email. They don't want to talk to the manager. They want to just do it by email. Others like the actual idea of physically talking to the manager, see what they're doing to try and get some kind of subliminal messaging maybe by the tone of their voice.

So that's entirely up to you. Normally, the conversation revolves around three things. Did anyone move in? Did anyone move out? And is there any other important news? Because those are the key things you want to know. Did I lose any customers? Did I gain any customers? Did anything else happen?

That's the kind of information that you want to know. The other thing you want to do weekly is you want to make sure that the evictions process is fully in motion. Let's talk about that for a moment. We are in the no pay, no stay industry. Whenever you deal with customers who do not have a lot of money, it's absolutely essential that you operate in a manner where they have to pay.

You cannot go around making elaborate payment plans nor can you just leave it up to them to pay when they want because that's not going to work. Every park needs to have then a very rigid eviction process for those who won't pay. Now, here's the normal process.

If the rent is due on the 1st, it's late after the 5th. On the 7th, they would be given a late fee and they would also receive a demand letter. This is based on your state. Some states only require one demand letter, some states require two demand letters.

States have different amount of notice, how long you have to give them in your demand letter, items like that. You've got to learn what those items are. So you can quickly get into a very simple process. It's like a little manufacturing plant. Person didn't pay, they get a late fee, they get a demand notice.

And then if they don't pay you within that demand notice ... That's what the demand notice is for. It's for the landlord to say, "I didn't get your payment. If you don't give me a payment by this day, I will file for eviction." Then you go ahead and file for the eviction which will then get you a court date.

And the court date, you'll have to have someone appear. It can either be a collections attorney or it could be your manager. Or in some cases, it could be you if you want to do that. I did it all myself in the olden days.

Nevertheless, you show up in court, your do your magic, you win your eviction, then you will get what's called a writ of possession or a writ of execution based on what the court calls it, which basically throws the resident out on the street. But of course, certainly, somewhere in that process, you end up getting paid.

But the process, although, it sounds complicated, once you get it down to an art form, it's very, very easy to manage. So you know the key dates. You know, "Oh, it's the 7th, got to send out those demand notices and put the late fees on their account."

"Oh, it's the 20th. That's the expiration of the demand letter timetable. Now, I file the evictions. Oh, it's this date. That's the date seemingly, every month, they have the evictions court." Then I have to wait a day or so for them to have the ability to appeal, which they never do. And then here, I file for writ of possession.

If you get to where you can literally do this while watching television, it gets better where it's nothing more. It is something that's very repetitive over and over and over. I've done it myself personally when I had 28 parks in the portfolio. I did that myself. It's really not complicated.

If you have multiple parks, you have a manila folder that's got the eviction form in it, that's got the demand form in it, then you can literally do it while you're watching a television program. You stuff it in an envelope and you mail it out.

So those are the weekly tasks, basically, staying on top of your manager and then making sure the eviction system is in motion. Again, not a lot of time expended. If you're spending more than 10 minutes on the phone with the manager, that's a fail.

The evictions process, you should be able to get all of those steps done, each step, whether it's the demand notices or filing the evictions. You should never spend more than an hour on that. Probably 30 minutes and in some parks, you won't have any at all.

So that's, again, not a huge time commitment. Then we come to the monthly time commitments. First one, invoicing. Yes, you need to invoice your customers. We tested invoicing versus not invoicing, you have to invoice. People can't remember to pay.

I am no different with my own bills. If someone does not send me a bill, I will never remember it. I'm far too busy to remember it. I can't memorize it. So invoicing is important. Do you want to invoice your customer? Typically, on the 15th of the month prior to when they pay.

Is that a monumental task? Not really. It depends on the software you use, and how you do your invoicing process. But even in the old days where I did it all myself, stuffing envelopes at home, it wasn't a big deal.

Sending off the invoices and mailing them out, if that's your strategy, if you're going to do a 100-space property, you should be able to stuff 100 envelopes during one episode of Modern Family. It's really not that difficult. Now, in other parks, the process is you have a manager distribute the invoices.

So you send the invoices to them, either physically or electronically, and they then print them and stuff them and deliver them. So once again, there's not any time on your part. Maybe what you're invoicing is not a hugely time-intensive thing.

Now, this next one is not time-intensive, very interesting though, and that's doing your monthly virtual drive through the property on HD video. What you do is you take a Polaroid Cube camera, that's our favorite, in a suction cup mount, and you mount that on the roof of the car.

Well, you don't. Manager does, and then the manager starts the car from somewhere outside the property, maybe 300 yards away and then drives up the street and through the entire property, every street in the entire property, takes the chip out of the camera and mails it you, and you then download the chip.

And then you have a GoToMeeting webinar with the manager where you both virtually drive to the park side by side in your virtual car there. You can stop, you can reverse, you can comment as you go on every inch of the property. It's just as efficient as everything else we've described because you don't have to go out there and meet with the manager.

You don't have to physically get in the car with them. There's no time expenditure like that. So how long does it take to do it? Well, downloading the chip, not a long time at all. Virtually, no time. Setting up the GoToMeeting webinar, that's not a big deal, driving with the manager.

Typically, these videos, the space and size of your park, if they're not super lengthy, manager doesn't stop while they're driving the car. So how long does it take you to drive through your park? Five minutes, 10 minutes? Again, not lengthy.

Typically, when we do those virtual drives, we don't have that many things that we want to change. We're normally just commenting, hopefully, positive things. "Wow, this tree is looking good, sign's looking good. That home we painted, that looks really nice. Oh, you cleaned that home up."

Typically, it's not a lengthy, lengthy call where you have just a million items. But you will see things and you'll write them down on a pad. You'll put non-running car on lot 14, dead tree, lot 12, too much junk in the yard, lot 43. And then you're going to take all these various items and collectively, that'll be your old business for the next drive.

In your next drive, virtual drive, you'll look for the same items and make sure they've been fixed. If they haven't been fixed, you call the manager in the park, "Why in the world did you not get the non-running car out of lot 23?"

"Well, he's my friend." "Well, no. That doesn't cut it. You've got to get it out. Before next month's video, you've got to get the car out of there," things like that. That's doing your virtual drive that you do monthly. You can do it less monthly if you want. Some parks look so nice.

The manager is doing so well that the owner elects not to do it monthly. So you could do it quarterly if you wanted. But when you're first starting out, I think monthly is appropriate. Next, produce your financial statement. Now, for many people, myself included, I am not an accountant.

I cannot do QuickBooks and Excel. I cannot do Rent Manager and I certainly cannot produce a financial statement that I would ever want to show to a bank or use to do my income tax. I have to farm that out. That's not an item that I am personally spending time on.

Now, I have to manage the process. So I have to elect an accountant or bookkeeper to produce it, and I have to get the data to them, but I'm not physically producing. So once again, not a big time investment there. Now, if you are an accountant, and you want to do it yourself, then you'd have a bigger time investment.

I'm not an accountant. I can't tell you how long it would take. If you are an accountant, you'd know long it would take. So to log in on a 100-space park, 100 rents, you're typically writing, in a mobile home park, 10 checks a month. Fill all that together and according to GAAP accounting standards or whatever case it may be, you would know that.

But as for me, I have to farm that out. Because next time, you have to do it yourself. You can't farm it out and that's having your BAD meeting. That's your formalized monthly meeting that you need to do even if it's just with yourself.

If you're the only owner, the only person who cares, the only stakeholder, what you're trying to do is you're trying to have a once a month, very serious meeting with yourself to go over your budget, your actual and the difference. Did you do better or worse in every category?

The way I think the most efficient way to do it is you take that BAD report and you take two highlighters. You have a green and you have a pink or an orange. Everything you hit budget or exceeded budget in a positive manner gets a green stripe.

If your revenue for the month was 17,200 on the budget but you hit 18,100, that would get a green stripe through it. Anything that you were deficient on, that you didn't hit budget, missed the budget, you would then highlight it with an orange or a pink highlighter.

Then what you have to do is look at all those orange and pink lines, whichever highlighter you use, and hopefully, you don't have many. And you have to figure out why. Why did I miss it? What can I do to fix it? Let's say you do your report but you have one big orange line.

Your water bill is off by $1,000. Well, I have a leak. That's what it has to be, I have a leak. What do I do? I call American Leak Detection, I find the leak, I fix the leak and I'm solved. Then the next month, hopefully, I don't have an orange stripe anywhere now. I'm back to a green.

Or the other thing you could have is your revenue itself is an orange stripe or a pink stripe. Why? Because I've got that vacant park-owned home. Gosh, darn it, it's sitting there. I want to get somebody in it. And we lost the customer and the manager has not done anything to get him in there.

So the...Hold on. I hear we've got something. Now, it's totally good. It's essential that you hold this meeting. Because what will happen is if you don't hold the meeting, people are going to invariably not have the discipline to make the hard decisions on what they need to do and they'll let it roll.

If you don't have that months BAD meeting, what's going to happen is you're going to sadly, unfortunately fall way, way off your budget which will be an asset crisis for you. Then what are some of the annual time time commitments you have to do? Well, annually, number one, raising of events.

How do you do that? Well, it's a formalized process. It's not what people think. I know that the John Olivers of the world assume that all park owners are like the little guy on the monopoly set with the top hat, looking down from on high with an evil agenda, "How high can I push the rent?

That's not how raising rent works whatsoever. What you do is you look at all the other parks out there and what they're charging, which means you're full comping, basically, calling to pretend that you're a customer to find out what they're charging.

You look at them on Street View and you see how you rate amongst them. You build a bar graph, one end to the other, the lowest rent to the highest rent and what those parks look like. And then you figure out where you fit into that bar graph.

From there, you now know where you need to be, then you look at where you are. There's a lot of mobile home parks out there where the rent should be 350 and mom-and-pop are, what, 185, 225. So you're never going to get to 350 if you don't raise the rent.

What you do is you annually set how much you want to increase it. There's a lot of factors. How much are you off the market? How nice are you compared to the other parks. And then such other issues is how much can the residents handle as far as an increase?

Often, the answer would be $50 or less in our opinion. Other additions would be if you think there's an employment shift that's been going on. Why is there an employment shift? Things like that. So raising rent would, again, be a very serious conversation you would have with yourself to figure out how much to raise the rent.

But it doesn't take a lot of time. You're using the same comps. You already have those phone numbers from when you do due diligence. So you're taking the same list and you're just updating that annually, calling around. You'll be shocked that some of these markets, if the property is changing hands, mom-and-pops getting more aggressive, the rent can go up substantially just in a year.

That's why you've got to stay on top of that. But it doesn't take that much time to assess the right amount if you work efficiently. Next, visiting the property. Yes, you do want to visit every property at least annually. Some people prefer every six months. I have no problem with that.

If you want to do it every six months, okay, that's fine. As long as it doesn't interfere with your life and you can take the time to do it, it's certainly not a bad idea. But you have to do it at least once a year.

I think it would be a terrible idea to own a mobile home park and never visit it. Because even though you get those HD videos, even though you have all the other gauges on your dashboard, nevertheless, you still want to physically see it. You would not want to physically abandon the concept, the process of verifying what's going on in your property.

That's time commitment I'll leave up to you. But annually, it's not much. If it's four hours from your house, you could just do it in one day. But if it's longer, you could do it on a weekend. But again, that's an annual commitment. So again, not a lot of time.

Finally, file your tax returns. Obviously, you've got to file tax returns or you'll potentially go to prison or at least be in a lot of trouble. Once again, I delegate that out. I'm not an accountant. If you are an accountant and you have the ability to do your own tax returns, then that would take whatever time it takes to do tax returns.

But for most of us, we delegate that out to a CPA or someone who is a professional tax preparer. What does it all mean? All those different things we've talked about here, the daily, the weekly, the monthly, and the annual items you do to run the park. It's not a lot of time.

In fact, if you listen to lecture series we've had in the past, interviews with other park owners, you hear the same number over and over from people, which is basically four hours a week. And four hours a week, people will say, "Well, that's impossible." You must commit four hours a week just on one item.

No, that's pretty much the thing for most park owners, is about four hours a week. Even then, that's probably an overstatement. That's probably not really pushing the envelope of good time use. So within that four hours, they've stayed on top of the rents coming in, they've written probably 10 checks, they've had their monthly meeting with themselves on BAD, they've prepared their statements, they've talked to the manager.

But again, it's not a huge time commitment. That's the bottom line from this lecture series event, is that managing parks, even finding the parks, doing the diligence, all of these steps are not time-intensive. Then that leads you to the next question which is so how is it fair to get paid so much money for doing so little work?

That was a big problem I had, and it was a big problem why we all assume it takes a lot of time to run a mobile home park, because we know they're lucrative, but it doesn't seem right. When I had my billboard company, I worked like a dog. I often ... I mean the David Letterman Show would come on.

This is back in old days when he came on late and was actually funny. When that show came on, that was a trigger for me to know that I was in the final few hours of my sprint to complete the work for the day to go home and start it all over again. Fairly depressing, kind of like working in a factory in some utopian black and white movie like Metropolis or something.

Then when I got into this business, I thought, "Well, how is this fair?" Because in the billboard business, I was killing myself. And in this business, it makes more money and there's not a lot of time spent. Here are my thoughts on what you have to realize as to why you get paid for not spending that much time in actual physical work.

The first is the feudal right of property ownership. Now, I went to college for a semester when I was at Stanford over in England. I liked England, I thought it was a fascinating place. And what I found looking at magazines in England, because anyone who's in England is certainly going to look what home values are and things, you noticed the properties in England come in two variety.

You've got leasehold and you've got freehold. Now, freehold is just like in the US. You own it free and clear. But leasehold, you don't own the land, you don't own the buildings, you own nothing. But these leases are sometimes hundreds of years long.

So you look at this thing, it'll say, "Leasehold property." There's like 116 years left on the lease, on this house. So then who owns that? Well, in most cases, the biggest leaseholder is Prince Charles. He has what's called the Duchy of Cornwall, makes about $28 million a year of incoming rent.

Then he does nothing for it. In fact, he doesn't even know where the properties are. He inherited the thing. And so he's not really getting out there working it, he's not mowing or doing anything, yet he's getting all this money in. And you realize that a lot of times, you get paid not for your brilliance or your good looks or your hard work or your amazing skill.

You simply get paid because you own something, and that's what mobile home parks are really about. You own the park and the simple fact that you own it and not that person over there, you get paid and they don't. So it's like just a feudal right of property ownership.

Next time item is that those who take the risk, get the reward. So you were the only person who took the risk. Many other people could've bought the mobile home park, but you did it. You put down the earnest money, you did the due diligence, you got the loan, you came up with the down payment, you watched over the property from afar, you go out and check on it.

Now, anybody else could've done it. It's a competitive world out there. Anyone could have but nobody did. You were the only one who did. So you're being rewarded for taking that risk. Now, remember, if the property tanks, you also get punished for taking the risk. So risk can go both ways.

But the bottom line is in America, the person who takes the risk gets all the rewards. If you read Sam Zell's book, you might be in two saddles. Zell is the biggest park owner in the US, and he talks endlessly about risk and reward. He's fascinated with that entire concept.

But it's a simple fact that he that takes the risk is the person who, in the end, gets the money. Finally, you're working smart. So if you know what you're doing and you work smart, and you use the systems, and you know what makes a park profitable, and you know what you're doing, you could get the job done in a very efficient manner, and that's why you don't spend a lot of time.

If you didn't know what you were doing, if you didn't use any modern systems, smart phone photos or anything else, you could work on that park 20 hours a day and still fail miserably. Part of the reason you don't have to spend a lot of time is because you're smart enough to know how to work the system and to do it efficiently.

That's basically what goes on in the day of the life of a mobile home park owner. It's all about making good decisions and initially working smart. Before I open the phones up to Q&A, I also want to let people know here in the COVID-19 crisis, obviously, it's the 100-pound gorilla in the room, and I'll be talking and writing extensively on it, what I see in the field.

I have already been. But we had our regular Boot Camp scheduled for April 17th and 19th, but we're not going to hold it because of the COVID-19 threat. It would be dumb to do it, it would be unfair to put people through any risk of getting the COVID-19 virus. So we're doing this at a virtual event.

Something we've never done before but we've been asked to do multiple times. So you can basically, for the only time ever perhaps, attend Boot Camp from your laptop at your home or office. And we've always had calls from people in the past who didn't have the time from their day job, career, family to go out to a live event for three days.

So if you want to do it, this is your once in a lifetime shot because we decided let's go ahead and satiate all those people who wanted to do that, whether it's for career reasons or religious reasons, they couldn't get out. We're going to do it virtually.

It'll be the same as our regular live event, identically. Same material, using the same course guide. It's going to be me live talking and you live asking questions. Only you don't have to get on a plane, you don't have to go to a hotel, you don't have to sit in a room, you don't have to expose yourself to the COVID-19 virus.

Also, people may like it because for the first time ever, you can attend on your own schedule. If you don't want to ask live questions, you can watch it at night on different days, whatever you want to do. So just wanted to throw that out there.

We got a lot of calls from people with questions regarding that Boot Camp and what we were doing. So we'll have more information on that shortly in the future. I'm now going to set the phones on Q&A. Hold on a moment here.