After concluding his professional baseball career in 2015, Jason Postill transitioned into real estate, joining a publicly traded investment firm with a $46B+ annual transaction volume. Specializing in multifamily and apartments, he later founded a commercial brokerage in 2019 before partnering with Tyler. Jason now leads strategic planning, system implementation, and operations, overseeing key areas such as marketing, acquisitions, debt placement, and investor relations.
Tyler Lekas began as a Financial Advisor, later transitioning to managing a hybrid book at Stifel Nicolaus. In 2017, he delved into acquiring and managing mobile home parks, purchasing his first in Florida in 2018. Together with Jason, Tyler has acquired 437 units and plans to secure an additional 600-800 units in the next 12-14 months. His responsibilities include overseeing property management, conducting inspections for new acquisitions, utilizing private utility expertise, and managing new/used home infills within each property.
Here’s some of the topics we covered:
- Jason’s Background In Baseball
- The Journey Into Real Estate
- How To Form A Great Partnership
- The Freedom That Comes From Doing Real Estate
- The First 68-site Mobile Home Park
- The Challenges That Come From Mobile Home Parks
- When Lenders Don’t Want To Lend
- Mobile Home Park Horror Stories
- Making Headlines & Receiving Horrible PR
To find out more about partnering or investing in a multifamily deal: Text Partner to 72345 or email Partner@RodKhleif.com
Full Transcript Below
00:00:00:01 – 00:00:19:11
Rod
Welcome to another edition of Life Time Cash Flow Through Real Estate Investing. I’m Rod Cleef and I am thrilled that you’re here now. You know, we’re changing things up a little bit. We’re not just doing apartments anymore. And so today I’ve got a couple of guys that are in the mobile home space, mobile home community space. So we’ve got Jason Postell and Tyler Lucas, and they are partners.
00:00:19:11 – 00:00:45:24
Rod
And I’m going to interview Jason first and then I’m going to interview Tyler because we don’t have the ability to interview two people at the same time yet, although that’s coming and we’re going have a lot of fun today. So hang onto your hats and let’s get into it. So Jason started his career in 2015. It looks like he was in Marcus Millichap for a good bit in their multifamily division and he handles acquisitions and Tyler handles the ongoing asset management after the fact.
00:00:45:24 – 00:01:00:00
Rod
Now, mobile home parks quite a bit different as it relates to the asset management then, well, even the acquisitions than multifamily. But I love the asset class. I know a lot about it and I’m excited to have some fun with these guys. So welcome to the show, brother.
00:01:00:01 – 00:01:01:02
Jason
Hey, thanks for having Strong.
00:01:01:03 – 00:01:12:17
Rod
Absolutely. Absolutely. So why don’t you do a much better job than I did in describing your background. I know you came from a baseball career and then Marcus and but but, you know, give us a little more detail, if you would.
00:01:12:18 – 00:01:34:16
Jason
Sure. Yeah. Well, yeah, my background, you know, I didn’t have the real estate background. You know, my family, my dad had, like one rental, right? It was I always heard horror stories, so I didn’t really get that passion from there. But my background was baseball. I saw a college signed with Dan Banks organization, played in the minor leagues for about five years, but I knew that chapter was going to close right at some time.
00:01:34:16 – 00:01:54:27
Jason
So I always had a passion for real estate, and I actually heard a big leaguer with the Tigers at one of the pro camps say that, guys, I didn’t make my millions in baseball was owning thousand apartments in South Detroit. And I was like, Bingo, okay. Because I was just I don’t know what it was, you know, walking Palm Beach in the commercial real estate, just the buildings had gravitated towards it.
00:01:54:27 – 00:02:09:09
Jason
So I was shortly after baseball. That’s that’s why I said, well, where do I start? I didn’t really know that brokerage was the route. Whatever it’s worth for your listeners, that’s not the case. Always, right? Get licensed, get your real estate license. That’s not it.
00:02:09:11 – 00:02:25:17
Rod
Well, let me interrupt for one second. You know, I get a lot of people that ask me if they should get their real estate license. And I tell them, sure, if you’re going to sell real estate, but not if you’re going to invest, mainly because you’re held to a higher standard. You’ve got liability, unnecessary liability, in my opinion, because, you know, they’re training you to protect the public.
00:02:25:17 – 00:02:41:25
Rod
Right. And so but again, if you want to make commissions for sure. Now, the other thing I’ll say is I think I do think something like Marcus Millichap is a fantastic framework for this business because you learn how to underwrite deals. You learn how to not be afraid of picking up the phone or making cold calls. I’m sure that’s mind numbing, but you got to do that.
00:02:41:25 – 00:02:46:21
Rod
And and so it’s a great way to drum up business as well. Sorry, I keep keep going.
00:02:46:21 – 00:03:08:28
Jason
No. And that’s it. And, you know, the training, the resources, self-education, you know, at that time I did get into residential residential, wasn’t it? It was more emotional side, just what the buildings was, what I wanted. So again, long story short into the the apartment brokerage and then really just understanding that the commission check chasing that wasn’t what I always wanted.
00:03:08:29 – 00:03:10:00
Jason
It was I was always chasing free.
00:03:10:00 – 00:03:11:09
Rod
You’re only as good as your last deal.
00:03:11:10 – 00:03:35:02
Jason
That’s it. And even from going back in school, you know, always trying to just have freedom, right? Not trying to be trapped in a job or. And so that’s what I realized, that, okay, chasing checks, I got to figure out this passive income side of it. And, you know, that’s where I ended up going in independent on my brokerage, is to keep, you know, the active income going and then took a pivot into the AMH space where I met.
00:03:35:04 – 00:03:36:04
Rod
Mobile home park space.
00:03:36:04 – 00:03:37:08
Jason
Right. The home park space.
00:03:37:08 – 00:03:38:27
Rod
And you met Tyler.
00:03:38:27 – 00:03:53:15
Jason
That’s where he met Tyler. And it was there a cold call, really. So you say on the phone? Yeah, that’s a great story because going to you what you said your point on picking up the phone call, that’s you know, Paul Collins not the easiest thing. It’s probably the easiest thing you can do that most people just fear and can’t do.
00:03:53:15 – 00:04:15:00
Jason
So when I did go independent and I was still calling on the broker side, he owned a park in Florida, Tyler did, and he actually hung up on my face. Oh, yeah. And I went into yeah, it was like, I think maybe my first week, nobody knew Ojibwe Solutions didn’t know the name, right? He’s like. And he literally hung up on my face, called him right back and because I didn’t get out what I wanted to say.
00:04:15:03 – 00:04:18:12
Jason
Right. So for at least for me, it’s just getting out. What I you.
00:04:18:12 – 00:04:22:24
Rod
Got to have some kind of thick skin if you’re going to do that. And so you were like, Screw it, I’m calling back. Yeah.
00:04:22:28 – 00:04:36:24
Jason
And you know, and yeah, one call can change your life, right? I remember my dad saying he was in sales like fortune and then the follow up, and then one call can literally change your life. And so I got out what I wanted to say, ended up meeting, you know, for the first meeting as, as you’re going.
00:04:36:27 – 00:04:39:27
Rod
So he put up with you on the second call.
00:04:39:29 – 00:04:51:16
Jason
Yeah. He heard something. Yeah. And then he’ll get into kind of how maybe he has a different spin on it. But yeah, it was more just because at that time I was actively selling, but I wanted to learn. And, you know, I’m not saying because I’m here, but my friend was your boot camp and.
00:04:51:22 – 00:04:52:09
Rod
Was in my boot.
00:04:52:09 – 00:04:56:06
Jason
Camp I did in Tampa. Oh, okay. And so I was at Market 2017.
00:04:56:06 – 00:05:01:22
Rod
HOST That was my first one. Tam First one ever. That was my first boot camp ever. Just so you know, I don’t know if you knew that.
00:05:01:22 – 00:05:02:20
Jason
I actually didn’t know that.
00:05:02:20 – 00:05:03:16
Rod
Yeah, I was my first one.
00:05:03:16 – 00:05:20:20
Jason
Okay. Wow. Okay. And it was amazing because, again, not saying this because I’m here, but it was it was a big moment of of just not being on the broker side and start hearing because that at your book I heard a woman she said oh your your apartment broker if you find a deal will give you equity. And I’m like, your guys are getting equity.
00:05:20:20 – 00:05:36:24
Jason
You know, I’m never here in this stuff right in the boiler room, right? You’re just churning and burning. But yeah, so that that was great. And that was a moment where it’s like, okay, look, I don’t need to wait till I’m you know, 55, 60 to start doing my investing and I can put the pieces together. And so that’s where that was a big.
00:05:36:24 – 00:06:00:29
Rod
Yeah, so, so guys, they do work in a basically a boiler room at Marcus, a millichap. I mean it’s phone calls. I mean it’s a great framework, you know, that kind of a of a of a business or that, you know, being in the in the finance side, you know, the capital market side is great as well or, or, you know, anything that, that construction, all these things are great frameworks for this business and and and so but then you went to my boot camp and somebody said, yeah, bring us a deal.
00:06:00:29 – 00:06:15:24
Rod
You have a piece of it. Well, that’s how it works. By the way, the fastest way to get involved with the team is either bring the deal or bring the money, right. You know, that’s the fastest way. And and so. Well, that’s awesome. And so you guys met and where are you at now? How many spaces you got?
00:06:15:24 – 00:06:16:15
Rod
What are you up to?
00:06:16:15 – 00:06:20:14
Jason
So yeah, so right after in 2020 and 2018.
00:06:20:14 – 00:06:21:12
Rod
Continue the story.
00:06:21:12 – 00:06:38:22
Jason
Sorry. Yeah. Yeah. Well, that was really it was after that I start saying, look, we have the pieces, can find the deal, have little capital on the sidelines and just figured out, hey you can do it, you can do it before or waiting. But then yeah, the CO call met and it was really two years. It wasn’t like, oh we just met and jumped in bed.
00:06:38:22 – 00:06:53:16
Jason
Yeah, we’re partners. I’m not saying that doesn’t happen, but it was about two years before we were here in Florida and we just couldn’t compete with these guys. This was in 2018, 19, just compressed cap rates record. But it was just, yeah, we just kind of end.
00:06:53:18 – 00:06:56:09
Rod
You couldn’t compete with what the others were buying these parks.
00:06:56:09 – 00:06:57:22
Jason
Yeah, cash quick flows.
00:06:57:24 – 00:07:02:15
Rod
And so it took you a couple of years to decide you were going to work together. Is that kind of how it worked?
00:07:02:18 – 00:07:05:09
Jason
Basically? And Tyler Will tell has is.
00:07:05:11 – 00:07:17:12
Rod
By the way, guys, you don’t know this, but Tyler sitting right next to him, he’s not framed in the camera. So those of you watching on YouTube, he’s right next to him. And they’re going to switch seats here in a minute. And I hate that we don’t have two mikes right now, but he’s nodding as as this stuff’s going on.
00:07:17:18 – 00:07:40:19
Rod
But anyway, you know, the reason I stopped you there for a second is, is that’s really good because it takes a while to to make sure that, you know, a partner is going to be a partner because a partnership is like a marriage, you know, easy to get into and hard to get out of. Okay. And I have a resource, by the way, if you guys go to Rod’s links, I have this book of questions you should ask before you get into a partnership, because you get caught up in the emotion of it.
00:07:40:25 – 00:07:48:17
Rod
A lot of people move too quickly in this regard. And so I think it’s really admirable that you guys took your time with it is my point on that. Yeah.
00:07:48:20 – 00:08:06:13
Jason
Yeah. And, and we’ve yeah, and we took our time when we get asked what why did it take so long. Well he had already owned a park. I didn’t own anything. The house it, I just been on the broker side selling deal so I was understand the space a little bit but it was again not compete with the cap rates, the due diligence, the time periods.
00:08:06:16 – 00:08:22:10
Rod
Well so so what I mean is just you could have moved forward by yourself and still dealt with those things. What what made the alliance help solve those particular issues. That’s because it I don’t know that it would.
00:08:22:12 – 00:08:27:12
Jason
Well, that’s a good question. Yeah. Because once we got the first deal was we snowball, you know, 16 deals in 36 months, right. So at.
00:08:27:12 – 00:08:30:11
Rod
16 deals and 36 months, 30 Holy crap.
00:08:30:11 – 00:08:43:24
Jason
Guy. And it snowballed and it was a fight. Well, first, the partnership. I think it was the only kind of part he was doing it full time. I was doing it full time other than, you know, I had the brokerage, but we were in this full time together, which is hard to find a lot of time doing it.
00:08:43:29 – 00:08:56:17
Rod
We get a lot of people do it on the side and a lot of people very successful on the side. That’s another thing. Sorry to keep interjecting, but as you say something, if there’s a teaching moment in there, I want to throw it in. And that is I get people all the time to say, should I quit my job and do this full time?
00:08:56:17 – 00:09:15:25
Rod
And my answer is always no. Okay. Because, you know, if fear pops in, because unless you’ve got a big nest egg, like you’ve probably had some resources from your you’ve got money coming in from your brokerage. By the way, guys, he owns a real estate brokerage. But, you know, he had money coming in from that and, you know, probably had some money left over from your baseball career.
00:09:15:25 – 00:09:29:17
Rod
And so if you’ve got a nest egg or you’ve got income, that’s a different story. But if you go cold turkey, I say no, because if fear is paralyzing and if you get caught up in financial fear, you know, you’re you’re you’re you’re going to have a problem because you won’t you’ll literally be paralyzed.
00:09:29:21 – 00:09:48:10
Jason
That’s it. Yeah, exactly. And and and finding the right partner is tough, too. And yeah, for the guys that are working, that’s it’s not impossible. You’re right. It’s just finding guys that are aligned. Maybe your other partners are working too. It’s just. Yeah. So it did take a while and then he had a, we had a broker relation that had a wild hair in Little Rock, Arkansas.
00:09:48:12 – 00:10:02:20
Jason
So he’s a less competitive market. But we liked what was going on. We looked more into the market and then we, you know, in 2020 got our first skate site park and it was it was a two park little mini portfolio and then it caught fire.
00:10:02:21 – 00:10:05:18
Rod
And what’s the smallest park? You have?
00:10:05:20 – 00:10:08:20
Jason
18 sites. Wow. 18 sites.
00:10:08:22 – 00:10:26:15
Rod
So his because, you know, my framework and my mindset has always been from my ex, from my limited experience, although I studied it a lot, I didn’t actually buy any parks. My brother’s huge in it, but is that you kind of need 40 or 50 spaces so you can have on site management, otherwise you’re doing the friggin management.
00:10:26:17 – 00:10:27:22
Rod
Is that an accurate statement.
00:10:27:25 – 00:10:28:07
Jason
That zero.
00:10:28:08 – 00:10:31:24
Rod
Percent. Okay. All right. So, so what’s the minimum you would recommend.
00:10:31:24 – 00:10:35:10
Jason
50 We talk about new markets going in because right now all Arkansas.
00:10:35:10 – 00:10:39:24
Rod
So the seven all of these were in Arkansas. Wow. Yeah. Was killed in Arkansas.
00:10:39:26 – 00:10:46:07
Jason
Yeah. Okay. One of the largest private is like, oh, that’s like saying we’re the richest man in the homeless shelter. You know, you’re.
00:10:46:09 – 00:10:47:09
Rod
One of the largest in.
00:10:47:11 – 00:11:05:01
Jason
The thousands. Like. Yeah, but we’ve strung together those small to midsize. And for you to talk about those you know we’re under the institutional guys they don’t care about anything under two, three, maybe arguably 500. Right. That’s right. So the private guy, though, taking down a 40 site that might be a little over his head. So we’ve really been able to do that.
00:11:05:01 – 00:11:05:10
Jason
So, you know, a.
00:11:05:10 – 00:11:09:13
Rod
Little bit of a sweet spot like between 40 and 100 or whatever, right?
00:11:09:13 – 00:11:18:27
Jason
Yeah, that’s exactly right. So that 18 site, your question on what’s the smallest that was also part of a five part portfolio. Oh, I was really 117 total units within a three mile radius.
00:11:18:27 – 00:11:38:18
Rod
Okay. So one manager can handle or your one manager with an assistant or whatever. Okay. That’s right. Got it. Okay. So let’s talk about mobile home parks in particular. And and although I know the answer is my, my, my students won’t, my listeners won’t. So what are the most important things you look at when you’re evaluating a park.
00:11:38:23 – 00:11:46:01
Jason
So in and that’s that’s a really good one with mobile home parks so we our model is is the tenant on homes.
00:11:46:07 – 00:11:46:27
Rod
Right okay.
00:11:46:27 – 00:12:05:29
Jason
When and right if you’re looking at a broker package and again to I’m still a broker right now so I’m going to say some things people like oh yeah he’s dropping on brokers will not we we do it you know we’re a broker so we we have to sell deals. Well, what sometimes investors don’t realize is that park own home income is a lot higher.
00:12:05:29 – 00:12:08:21
Jason
But if you sell it off, that income goes away.
00:12:08:21 – 00:12:31:05
Rod
So let’s talk about let me let me elaborate on what you just said. So on an a mobile home park, you could own the homes, these these mobile homes on the park. Or you can let the residents own them and just pay rent. There is no greater brain damage, in my opinion, than having park owned homes. Okay. These mobile homes are not the best constructed things on the planet, number one.
00:12:31:05 – 00:12:58:04
Rod
So they break down very easily. That demographic is probably the toughest, lowest demographic in the United States as far as rental renters, you know. And so so if you own the homes, first of all, they have no pride of ownership like they might if they do own the home themselves. So. So would you agree that one of the best business models, if you find a bunch of park owned homes in a complex, is to convert them and sell them to the residents?
00:12:58:04 – 00:13:06:22
Rod
Is that an accurate statement? Yes. Okay. So so that’s a critical piece. I was actually looking for something else. What else do you look for when you look at a park?
00:13:06:24 – 00:13:09:06
Jason
This the red flags one the utilities.
00:13:09:06 – 00:13:12:20
Rod
Thank you. That’s where the infrastructure, the utility infrastructure is. Huge.
00:13:12:20 – 00:13:13:05
Jason
Huge.
00:13:13:06 – 00:13:16:15
Rod
Right. So, you know, if you want to elaborate on that, a little bit.
00:13:16:15 – 00:13:24:21
Jason
Yes. So out of the 16 communities right now, there’s so private utilities being, you know, septic tanks, wastewater treatment plants, lagoons. Right.
00:13:24:27 – 00:13:26:14
Rod
There’s your own. Well.
00:13:26:16 – 00:13:27:09
Jason
We do not.
00:13:27:09 – 00:13:48:08
Rod
Always want to say so. By the way, guys, there’s mobile home parks where you literally have a lake that’s a pool of shit that that that it’s called a lagoon. Okay. And then you also have mobile home parks. It’s got these treatment plants that can be extremely expensive to replace or repair. So that’s a real red flag. And some of the old ones also have.
00:13:48:11 – 00:14:17:16
Rod
So you got to be real careful with with well and septic and really really well and and and wastewater treatment solutions whatever they are. Sure. You know obviously the ideal is to have city owned water and sewer, correct? That’s right. Right. But yeah you stay away from lagoons and and and if you if you do get a treatment plant in your in your assets, you better have it checked out like really well before you could pull the trigger.
00:14:17:16 – 00:14:20:11
Rod
Right. Have you ever had to replace one. No. No.
00:14:20:14 – 00:14:24:21
Jason
And we have one property that has private there’s septic. So there’s ten septic tanks.
00:14:24:22 – 00:14:44:07
Rod
Okay. But see see that’s, that’s another thing though, you know, if if a if you’ve got like one big septic for a larger community and that has a problem, that’s a big deal or worse than that probably is a well if you’re on a well and you have to test them and all that stuff and and I know Kevin, we talked about Kevin, Bob was a good friend of mine.
00:14:44:07 – 00:15:03:11
Rod
You guys visited with him yesterday. He’s also big in the mobile home space that they’re buying. They’re taking on a big one, right? Yeah. Yeah. My brother’s helping him. And so, you know, he always likes to have an alternative solution for the utilities just in case something goes wrong. Like if you unwilling septic see what it would cost to tie into the city.
00:15:03:11 – 00:15:06:00
Rod
I mean, you guys are on the same, same framework there.
00:15:06:00 – 00:15:29:03
Jason
Yeah, we always like to have an idea. Oh it’s 200 yard or whatever that, that the distance The distance if the tap into it. Right. For instance the one property we have right now, the only property that has septic utilities, we bought land next door because we asked and and county of it’s kind of like the Wild West right now but it might not always be So they I say, oh do whatever you want but there might be a day right Right.
00:15:29:03 – 00:15:45:21
Jason
So we they just said, well as long as you have the capacity to, to put more tanks. So we bought the land next door just in case. Just in case. Right. And we’re actually looking to develop that another side. Okay, we’re not developers, but you know, we we bought it for one reason, but it has some upsides. Oh, that’s great.
00:15:45:23 – 00:16:01:27
Rod
That’s great. Win win. Yeah, but but so that’s what I was looking for is, you know, with a multifamily apartment complex, you don’t, you know, it’s always going to be on water and sewer and you don’t have to be. It’ll be public and whatever, or it will be private, but you’re not going to have to worry about it unless, you know.
00:16:01:27 – 00:16:30:07
Rod
The only caveat to that would be if you buy an apartment complex as a chiller, like for a building, those can be 100 grand or more. But but mobile home park. So that’s that’s the biggest. So what else when you’re evaluating a mobile home park from a from a financial standpoint, you know, doing your underwriting, what sorts of things do you want to make sure you don’t miss when you’re doing your underwriting and and evaluating the numbers on a park?
00:16:30:14 – 00:16:37:24
Jason
Yes. So the the lot rent, again, going back to that is if the deal can stand on its own with with the lot rent right. Pending on how much we have.
00:16:37:24 – 00:16:53:16
Rod
Then it’s a deal and it’s just kind of because you’ll see income that has all that park owned rent but but you’re going to try to eliminate that which is of course is going to be higher than lot rent but higher on the on the income side. Right. But also way higher on the expense side. Exactly right. Yeah.
00:16:53:16 – 00:17:01:23
Rod
If you just have a lot rent your expenses, go way down because you’re then you’re just landscaping, you’re paying for utilities. And unless you back build those or whatever. Right.
00:17:01:26 – 00:17:15:14
Jason
Yeah. And, and that’s and that’s why I want to back up to that point again because the, you know, the brokers have put that is still real income. But, you know, lenders, there are some we’ve heard now starting to lend on some parking. But traditionally they don’t want to see more than 25%.
00:17:15:14 – 00:17:16:08
Rod
Park don’t.
00:17:16:10 – 00:17:21:29
Jason
Own homes. So you have to understand if there’s an exit, you know, we always want to refine. Hold on. And that’s.
00:17:22:00 – 00:17:22:14
Rod
Your that’s your.
00:17:22:14 – 00:17:25:11
Jason
Is always good. Make sure we we have that exit.
00:17:25:11 – 00:17:47:07
Rod
But so so evaluating a park I just want to make sure we’ve covered everything we talked about the utility infrastructure. We’ve talked about park owned versus you know, resident owned homes. Have you had any run ins with local municipalities trying to buy a place because they love mobile home parks? That’s sarcasm, by the way. Major sarcasm.
00:17:47:09 – 00:18:04:17
Jason
You know, some people ask, oh, what’s is your you know, the story. Right? And I mean, the horror story was quick and over, but it was right after we closed on and we do due diligence. Right. How many certificates, you know, how many certified sites are allowed to get there. Right. So but I had to call down to the city for something the day of.
00:18:04:17 – 00:18:06:23
Rod
Closing like a little closer. Oh, here you because you’re speaking.
00:18:06:23 – 00:18:20:26
Jason
Oh, okay. Yeah. And I called down the day of closing and and the ones that. Oh, your pass condemned. Oh. Almost threw him as I was telling him the I was almost dropped a condemned. What do you mean. Because I heard about that. Oh the cities are taken over or they class about.
00:18:20:28 – 00:18:24:25
Rod
So they tried to they claim we’ll just take over the park. Yeah.
00:18:24:25 – 00:18:30:19
Jason
And then she said, but because they were in a couple of the part I mean the cities hate hate tomorrow can’t say for everybody, but.
00:18:30:21 – 00:18:31:00
Rod
Most of.
00:18:31:00 – 00:18:42:07
Jason
Them hate them. They’d rather see it just, oh, bulldoze it, put up a nice day class of building and just it’s better for the city or right. What they think. But yeah, we have ran into that. But what they did start noticing.
00:18:42:07 – 00:18:44:10
Rod
And how’d that work out, by the way?
00:18:44:12 – 00:19:01:13
Jason
Well I said there’s no way we have the certified sites. And she said, well no, it’s showing this. So then I called someone else and then we had done the sort of, you know, gotten the certified sites and said, we’re grandfathered in, and we went through it. So it was just a little scare. But it does happen. Yeah, for sure happens.
00:19:01:15 – 00:19:09:18
Rod
Well, let me ask you this. I’m sorry to derail and shift gears again. Do you guys look at any of these with the possibility of a different use?
00:19:09:20 – 00:19:11:03
Jason
Really, We haven’t.
00:19:11:03 – 00:19:16:20
Rod
So we haven’t got those like inner city ones where where the highest and best use could be something better than a mobile home park.
00:19:16:24 – 00:19:23:02
Jason
We haven’t yet. Unless, you know, if there’s a billboard we can put in or maybe there’s some land for a cell phone tower. But no, we haven’t because we.
00:19:23:03 – 00:19:44:12
Rod
I’ve got some here down on Tamiami Trail. I mean, that is prime freakin real estate. You got a mobile home park? Hell, the retail value alone will likely eclipse the value of the the mobile home park. I’m just curious. Okay. Yeah. So. So. So what have we missed here? We talked municipality, utilities and income. So how do you finance these things?
00:19:44:12 – 00:19:46:28
Rod
Because it’s different than mobile, than multifamily in many cases.
00:19:46:28 – 00:19:56:00
Jason
Yeah. So what happened? We’ve done from owner finance. I mean right now with where the interest rate, we’re still getting deals done and that’s a big reason why on the.
00:19:56:01 – 00:19:57:02
Rod
Finance financing, Yeah.
00:19:57:03 – 00:20:14:05
Jason
And our first deal, the 68, it was an owner financing. So we did though from the next seven local banks. So what what happened was the the part that nobody wanted to finance an 18 unit or a 34 or it was a.
00:20:14:05 – 00:20:16:27
Rod
Reason to call a clue. Okay, Well.
00:20:17:03 – 00:20:32:16
Jason
Yeah, well, and that’s right because I yeah. And because I’ve heard guys it too. I just flip it to three lenders and they’re my underwriter and then I can pass on doing that. Will we see these deals where the lenders won’t lend on them? But all we need to do we have one park. It was $90 lot rent.
00:20:32:19 – 00:20:43:17
Jason
You can move anybody in America live in for a while and market we went just to to 50 the market was three 350 so we were still even under market and yeah that was a good I mean we.
00:20:43:17 – 00:20:50:29
Rod
Redefined I want to talk about rent increases in just a second here, but that oh gosh, if you like, we were going down a path somewhere. Oh, financing.
00:20:50:29 – 00:20:52:10
Jason
So yes, sorry, I was taking them.
00:20:52:12 – 00:21:10:21
Rod
Yeah. Was so seller financing and bank financing is huge. Also want to talk about marketing, but let’s talk about rent increases because you know, I don’t know if you heard about Kevin’s horror story, but he raised you heard Tyler’s nodding. So so he raised the rents on a on a park. He made the cover of the local paper.
00:21:10:21 – 00:21:17:18
Rod
And I think he made national news actually over it. So have you guys had any any run ins like that?
00:21:17:21 – 00:21:22:12
Jason
We’ve had people I mean, just call and it’s threatening what the No.
00:21:22:15 – 00:21:24:19
Rod
One, no national pubs, no publicity.
00:21:24:26 – 00:21:26:03
Jason
That’s the worst that No. Yeah.
00:21:26:07 – 00:21:52:12
Rod
Kevin was it was horrible for him but, but you know it’s over in its past but, but you know the thing about mobile home parks so what makes. I’ll let you answer so what makes it rent increases on mobile home parks different than apartment complexes. So what I’m looking for something here that I’m trying to as the cost of for them to leave.
00:21:52:15 – 00:21:57:02
Jason
Oh yeah. The cost for them to leave. They Yeah. It’s 3 to 5 grand to move them.
00:21:57:08 – 00:22:12:07
Rod
To move a mobile home park. So, so you kind of got them locked. You kind of got them a little over a barrel is what I was looking for. Right. You know, because if they own the home and and, you know, you bump their rent up 100 bucks and it’s going to cost them five grand to move their home to another park.
00:22:12:09 – 00:22:15:17
Rod
You know, it’s it’s you know, that’s an easy decision.
00:22:15:17 – 00:22:22:17
Jason
Oh, yeah. It’s and they and we were never the leader either. Not like oh we’re just to the point of.
00:22:22:18 – 00:22:26:22
Rod
Going from so you’re not, you’re not pushing the rents beyond what the market is. No. No.
00:22:26:22 – 00:22:42:12
Jason
And now we control a big I mean just in Little Rock we control most of that market. So there any park we’re we’re right there so you know but when they see what we have notice of course they’ll complain we hadn’t made the news and got but yeah you know the $90 they hadn’t raised it in 15 years.
00:22:42:12 – 00:22:48:08
Jason
Right. Most of them will realize, okay, this is normal. We’re still we can’t go anywhere else. They see us put in paving.
00:22:48:08 – 00:22:58:08
Rod
What is this? I’m sorry, Sergeant. Yeah. Do you put. You’re making improvements, You see? You’re making it nicer. What’s the average rent on a single wide versus a double wide in Little Rock, Arkansas.
00:22:58:08 – 00:23:00:05
Jason
Oh, so the the lot rent.
00:23:00:08 – 00:23:02:24
Rod
Lot rent. Sorry, the rent is three.
00:23:03:01 – 00:23:10:21
Jason
We average 353. And this is central. Central. So double double wide or not, it changes if we’re leasing it with an option to purchase. But the lot rents.
00:23:10:29 – 00:23:11:06
Rod
Three.
00:23:11:06 – 00:23:15:22
Jason
5350 we get to Fayetteville, those are nice, maybe a little premium.
00:23:15:23 – 00:23:28:28
Rod
Little more than $500 to 500. Okay. Yeah. So, so just you guys realize, you know, if they own the home that they paid five, ten, $20,000 for all their pains, 350 a month plus some utilities. Yes, that’s it. It’s pretty damn cheap rent.
00:23:29:01 – 00:23:45:27
Jason
That’s it. When they’re car payments, a lot of times we’ve had more. Right. Right. And they appreciate the new roads because we’ve had some people all year hike in rent some some guy said that for like, oh, how do the families feel when you make their rent go up? We’re like, well, they’re actually pretty sure because we put it we’re taking over from a mom pop that has never gone in 20 years.
00:23:45:27 – 00:23:54:19
Jason
Right? Right. And so we come in, put new roads and trim trees so they’re not falling through their homes and appreciate it. And so, sure, it’s not a huge but sure.
00:23:54:19 – 00:24:14:02
Rod
Sure. So now let’s talk about how you find these deals. If you willing to give up a little secret sauce here. I mean, I know what I did when I was going to get into this business. And and I’ll just tell you, I learned from Kevin, actually, and and I had eight virtual assistants combing the country, basically marking down every single mobile home park in the country.
00:24:14:05 – 00:24:32:10
Rod
They’d go on Google Earth. They’d see where a mobile home park. And then they fly around to find ones that weren’t even on the in the system because they were mis categorized. Wow. Then they would geo code them, find out who the owner was. You can put an overlay on Google Maps, the owner was, and then we would get their home mailing address and phone number.
00:24:32:12 – 00:24:46:03
Rod
And I did this in the whole country, had eight Vas do it for a year and then I ended up not doing it and I ended up I can’t say what I did with the list, but I did something with the list. But, but anyway, yeah. So is that something similar to what you guys do?
00:24:46:05 – 00:25:03:00
Jason
That’s exactly it. Okay. I know. I mean, there’s a lot overlap still. I mean, we’re two man band in the same, right? Want to believe what we really have. So there’s a lot of overlap but and it’s funny you say go fly over and look for parts because there are parts in some of these states for sure and they’re categorized that right?
00:25:03:00 – 00:25:07:20
Jason
Mis categorized. They’re not going to be on your costar. So the brokers all over the nation are going to be.
00:25:07:25 – 00:25:16:23
Rod
Or they’re categorized in the county offices even they’re they’re called something else. It’s crazy. But so yeah, so, you know, we’d find them by, by just doing the Google.
00:25:16:23 – 00:25:32:29
Jason
Yeah. And we absolutely Yeah yeah. There’s websites free websites that people because I that was the only thing really I wanted to know on the brokerage side that residential wasn’t ever show you is how do you drive by a building find the owner who owns that and get him on the phone actually know what to say to get a meeting with that was all.
00:25:32:29 – 00:25:49:10
Jason
And so there’s so many ways to do it. And we have lists. But yeah, Tyler’s literally been driving he’s on in lives in in Arkansas. So he goes through through and he’ll just drive by apartment like we’ve never seen this on the map. And then he shoots me, address. I’ll call him then he’s meeting them the next day or something.
00:25:49:10 – 00:25:52:01
Jason
So we’re still we’re still very.
00:25:52:03 – 00:25:52:16
Rod
Still fine.
00:25:52:20 – 00:26:06:03
Jason
Yeah. We did the VA and had had and then it’s just but when we buy a park in week it, we get on the phone, one of us and just said we own next door It’s it’s just such a different call that we haven’t been able to train yet right. I can’t tell any of that.
00:26:06:03 – 00:26:07:23
Rod
But what. Yeah.
00:26:07:23 – 00:26:13:02
Jason
Well I can’t rope him into that. I was going to say I haven’t train. We could train a VA to say whatever we want, but it’s.
00:26:13:04 – 00:26:14:04
Rod
It’s always better.
00:26:14:04 – 00:26:14:23
Jason
When it’s tough.
00:26:14:23 – 00:26:19:03
Rod
Yeah, it’s, it’s, you know, because you never know what they’re going to respond with but and.
00:26:19:05 – 00:26:22:01
Jason
It’s been a direct call. Yeah. That’s, that’s how we’ve been doing it.
00:26:22:05 – 00:26:40:02
Rod
So let’s shift for a minute and talk about positive stories in a couple of war stories or one of each whatever, whatever comes to mind here in that, you know, a great experience that you had and in a not so great experience. So so start with whichever one you want.
00:26:40:04 – 00:26:50:09
Jason
Okay. We’ll start with the horror story because, yeah, the last the best one. So far has been our last. Last year we had our largest deal, 122. That was.
00:26:50:09 – 00:26:52:00
Rod
Okay. Well, let’s talk about the war story first.
00:26:52:00 – 00:26:56:11
Jason
But yeah, so earlier you talked about the conversion of the parking, right?
00:26:56:13 – 00:27:02:26
Rod
So park owned to to resident own. So you’re just collecting lot rent. You got an easy management set, right?
00:27:02:26 – 00:27:10:22
Jason
Yep. And that’s been our model so that we had a 33 site park that it had a little commercial building up front, but it was all park. So was the.
00:27:10:22 – 00:27:12:01
Rod
Parkland, all the homes.
00:27:12:08 – 00:27:25:10
Jason
All of them. And so our we, we dealt with that yet. So we said, okay, we’re going in, we’re going to go like because you can Happy birthday, Merry Christmas. Give them away or force them to buy or not force them to buy, but say, here you go.
00:27:25:12 – 00:27:40:06
Rod
So you can. So just let me let me slow you down a little bit so they understand. So, yes, sometimes you can just give them the home and let them start paying lot rent. But you’re responsible for all the maintenance, upkeep, everything else. And that can be a win on a on a really old home, I would suppose.
00:27:40:09 – 00:27:48:24
Rod
But the second thing is you can also finance them, right? And that’s the most common, Wouldn’t you agree, where they’re paying lot rent plus they’re paying a payment towards their towards their home.
00:27:49:00 – 00:27:54:07
Jason
Exactly right. Exactly. And we and now we have different option, which is a way more graceful way and asking.
00:27:54:07 – 00:27:55:02
Rod
Available now as well.
00:27:55:02 – 00:28:12:11
Jason
Yes. Okay. Well yeah their option they’ll put a small down payment and have, you know, 72 months or whatever many months. But we gave them one option at this 33 that this is their lot rent, this was what their payment was going to be, which really wasn’t changing a whole lot from what they were already paying just as a rental.
00:28:12:14 – 00:28:14:02
Jason
And I don’t know if it’s just because.
00:28:14:02 – 00:28:23:05
Rod
So you so you basically told all 33 people here’s how here’s here’s a new sheriff in town. Here’s what we’re willing to take it or leave it and what and.
00:28:23:05 – 00:28:32:16
Jason
50% left the 50. I mean, it’s like a number. You hear people like, oh, you buy a park right here, single family, you got rent or some vacant one. Right? Having 33 and 50% goes by.
00:28:32:16 – 00:28:33:24
Rod
That’s that’s painful.
00:28:33:24 – 00:28:39:25
Jason
That’s bad. It was it was painful, which is now one of our better best performers. But it was it was a wake up.
00:28:39:25 – 00:28:51:19
Rod
What was bad is you probably had 50 you had 50% in shitty condition that you had to go in there. Yeah. Hodl. Yeah. And before you could reprint them, sell them, whatever that was probably the biggest pain is all that maintenance work.
00:28:51:19 – 00:28:56:10
Jason
Exactly right. And then realizing, okay, well, we didn’t raise maybe.
00:28:56:10 – 00:28:56:21
Rod
Enough.
00:28:56:21 – 00:29:02:28
Jason
Money, enough to do the costs or the costs went up in that time. So it was right. Yeah, there’s a lot of lessons learned in that one.
00:29:03:01 – 00:29:09:11
Rod
So that’s that’s a that’s a good one. That’s a good horror story. Yeah. So what would you have done differently knowing what you know now, just out of curiosity.
00:29:09:16 – 00:29:15:11
Jason
Oh, the options just come in graceful. Like not saying, hey, this is Zed or you’re out of it.
00:29:15:12 – 00:29:24:00
Rod
We want to work with you. We’ve got multiple options we’d love I know you’d love to own your own home. We want to make it as easy as we can. Blah, blah, blah. Got a little bit of sales process we.
00:29:24:00 – 00:29:38:05
Jason
Want to help provide. Yeah. Home ownership and and just a. Yeah, much more graceful. Graceful. Yeah. Compassionate and that’s work now so we have we have done that. Oh that would have been Yeah. That would have been.
00:29:38:08 – 00:29:46:17
Rod
Okay. Well listen I appreciate this Jason and let’s give Tyler a shot at best. Yeah. Talk of a better, better, better metaphor.
00:29:46:20 – 00:29:47:23
Jason
He’ll tell the good story.
00:29:47:25 – 00:30:09:06
Rod
Tyler’s up to bat, for lack of a better metaphor. So we got Tyler let us up now. And Tyler does more of the asset management. Sounds like you’re also involved in the acquisitions. If he calls you to go talk to an owner and put it, you know, negotiate a deal, put it together, right? Yeah. Why don’t you tell a little bit of your story before, you know, meeting Jason and all that?
00:30:09:08 – 00:30:31:07
Tyler
Yeah. So I started out in finance, so I was I traded fixed income at a couple of different places. I started out in the retail side, so I was a financial advisor. So I came from the same, you know, grinding sales background that the Jason I made 29,000 phone calls my first year as a financial advisor. I was in there seven days a week and there was nothing that was going to get me off the phone.
00:30:31:09 – 00:30:41:11
Tyler
And so that’s kind of how I built my, my background in that I kind of moved up the the rungs there a little bit and I ended up trading fixed income for some some banks and hedge funds and mutual funds and stuff like that.
00:30:41:11 – 00:30:42:20
Rod
So sales background.
00:30:42:23 – 00:30:55:23
Tyler
Exactly. Yeah. And, and then I ended up starting to work like 120 hours a week. I was in the office at 2:30 a.m. Australian different markets, blah, blah, blah, blah blah. And then I was leaving at like 9:00 at night. So I was like, That’s.
00:30:55:24 – 00:30:56:19
Rod
A life there, boy.
00:30:56:20 – 00:31:14:25
Tyler
Yeah, All right. I got big and fat and, you know, I was terrible. So I, I was like, There’s got to be a different way. So my dad ended up sending me a part a article about mobile home parks, and he basically just put a little snippet at the bottom and said, Hey, you’re you’re smarter than all these real estate guys are pretty stupid about running cash flow.
00:31:14:28 – 00:31:33:07
Tyler
You should you should run circles around them obviously talking kind of tongue in cheek. And and so I started looking at the asset class a couple months later. About six months later, I quit my job, ended up starting to look into buying mobile home parks, ended up buying my first park down in in 2018 and then met Jason in 2019.
00:31:33:14 – 00:31:39:03
Tyler
And I just wanted to also just add one one little flavor to that. That story, that.
00:31:39:03 – 00:31:40:16
Rod
Phone call, that initial phone call.
00:31:40:16 – 00:31:48:13
Tyler
Yeah. So I was I had a couple of beers, my buddies. And so when he called, I ended up telling him to f off. I hung up the phone.
00:31:48:15 – 00:31:51:06
Rod
Oh, no kidding. You left that part out. Okay. Yeah.
00:31:51:10 – 00:31:52:13
Tyler
So he calls.
00:31:52:13 – 00:31:53:16
Rod
Back, right?
00:31:53:16 – 00:31:57:22
Tyler
And I was like, because I was in the sales side, right? I was like, I like this guy.
00:31:57:22 – 00:32:01:21
Rod
Okay, okay. Yeah. I think that of all, I was like, This guy’s got some snowboards. Yeah.
00:32:01:27 – 00:32:20:16
Tyler
You know, And so and, and then, you know, and Jason, I kind of got together because, like, you know, I mean, a lot of people, you know, these days were like, Oh, Tyler, you know, or Tyler or Jason, you, you guys have done so well, blah, blah, blah. But I, I spent every nickel I had on that park and, and, and Florida and.
00:32:20:21 – 00:32:22:20
Rod
Oh, I didn’t know it was in Florida. I was okay.
00:32:22:20 – 00:32:24:24
Tyler
We’re in Titusville, Florida. Okay.
00:32:24:27 – 00:32:25:17
Rod
Small town.
00:32:25:23 – 00:32:45:14
Tyler
Yeah. And and so I was uber ing and and I was doing a courier service was transplanting a hearts and skin all around the state of Florida because I had I didn’t have any money. So Jason was like, hey, I got some capital. I can continue to help you kind of grow the grow the business. And a lot of people, you know, again, you know, they they see one thing and there was a.
00:32:45:16 – 00:33:01:05
Rod
It’s important, you know, it’s important you see this duck floating on the water. You don’t see the legs underneath other flippers underneath going like crazy. Yeah. Yeah. And, you know, everybody thinks that this success stories is like, you know, what they see on Instagram and they don’t realize, you know, that there are a lot of sacrifices you have to make.
00:33:01:05 – 00:33:04:21
Rod
Are you guys both single, by the way? Yes, single. Okay. So no kids.
00:33:04:22 – 00:33:05:19
Tyler
Jason’s daughter.
00:33:05:24 – 00:33:22:13
Rod
You have a daughter. Okay. Okay. Yeah. And but you guys actually didn’t have other work. And I’ve got my students on somewhere between 180 and 190,000 units that we know of at this point. And that was my first event, by the way, that when you went to I’m real proud of that and and a lot of them do it on the side.
00:33:22:13 – 00:33:34:03
Rod
So, you know, you don’t have to do this full time. And, you know but but you guys did and look at you. You’re killing it now. And so anyway, were you done with your story?
00:33:34:03 – 00:33:46:06
Tyler
Yeah, obviously. Long story short, yeah. We, we met and then yeah, we try to go by all these deals together and what really built our and because I looked at your rod links and I looked at that partnership questionnaire that you guys said, Oh, you do.
00:33:46:06 – 00:33:46:26
Rod
Good, good.
00:33:46:26 – 00:34:03:03
Tyler
Good. And we never, we never filled something out like that. Right? But the main thing that drew Jason and I together is that we said at 70, we want to own 10,000 of these mobile home park units and we want to buy and hold and refi and do what’s best for our investors. Right? Period. End of story. Right.
00:34:03:03 – 00:34:17:07
Tyler
And we’ll go and I work pretty hard. I pride myself on my hard work because, you know, if you’re if you’re not if you’re not smart, you got to be a hard worker. Right. And Jason has, you know, consistently outworked me. So, you know, I mean, that’s that’s also a lot of work.
00:34:17:07 – 00:34:34:04
Rod
Ethic is good work. That’s a critical question when you’re looking at a partnership question. Yeah, yeah, yeah. So, by the way, it’s Rod’s links and there’s that partnership book there. If you’re thinking about getting into this business, and I’ll add a caveat to that book, and that is trust your gut, okay? Your intuition is incredibly powerful. Trust it.
00:34:34:04 – 00:35:00:01
Rod
If it doesn’t feel right, something’s off. Your brain picks up on these micro nuances you’re not consciously aware of. So you guys are now on track to continue purchasing hundreds of units. Let me ask you this question. You know, as as this economy gets tougher, you know, that demographic is getting killed. Okay? Because, I mean, I’m single now and I went and bought some groceries and and I was I was standing there with the clerk.
00:35:00:01 – 00:35:14:04
Rod
I’m like 150 for that. Are you fucking kidding me? How do people afford this? You just she just shook her head. And gas cost me 120 bucks to fill up my truck. I’m like, that’s. That’s almost what? That’s more than the lot rent used to be on that place you bought. So it’s like, Yeah, how do you know?
00:35:14:04 – 00:35:23:20
Rod
And so are you seeing this economy impact your collections because of inflation and everything that’s happening right now? I’m just curious is is it.
00:35:23:27 – 00:35:36:14
Tyler
Yeah, no. So we have a really, really, really again, when it’s ten it own homes, it’s park owned homes and we do another of a financing for either homes we’ve renovated or new homes that we bring into the property.
00:35:36:14 – 00:35:38:23
Rod
New homes right now spaces without a home on them.
00:35:38:23 – 00:35:52:21
Tyler
Right. Yeah like a rent to own. Right. So they put a little deposit down and then they pay a rent to own for me, I’m 60, 84 months, whatever it is. Right. But that tenant on home income is very sticky because basically if you can’t pay 350, you’re on the street.
00:35:52:24 – 00:35:53:05
Rod
Yeah.
00:35:53:06 – 00:35:59:16
Tyler
So you drop that notice to vacate out after they missed a month of rent because we’re not a we’re not a a bank, we’re not not.
00:35:59:16 – 00:36:00:00
Rod
A charity.
00:36:00:00 – 00:36:21:11
Tyler
Either. Exactly. You know, and the they pay that and it’s very sticky. And the unfortunate thing and the reality of our business is if they ended up leaving that home, the home’s usually in decently good shape. You can usually either give it away and there’s no break in the income or they go out and sell it right. And then a new renter comes in and there’s no break in.
00:36:21:11 – 00:36:22:16
Tyler
You’re in your income stream.
00:36:22:17 – 00:36:23:05
Rod
Oh, interesting.
00:36:23:05 – 00:36:30:07
Tyler
So and so that lot rent is super, super sticky. So again, we had 98% collections through COVID.
00:36:30:12 – 00:36:31:26
Rod
Wow. Fantastic.
00:36:31:26 – 00:36:34:05
Tyler
And it was yeah, it’s it’s a very, very sticky.
00:36:34:05 – 00:36:38:22
Rod
And they get rental assistance like we did on our multifamily. Did you see them go and get assistance.
00:36:38:26 – 00:36:39:07
Tyler
That.
00:36:39:09 – 00:36:56:16
Rod
They weren’t sophisticated enough? Yeah, you know, we had our onsite managers and stuff line these people up. I mean, we got hundreds of thousands in covered rental assistance. I thought that was going to be the catalyst. I really did. I thought that was going to be the shit hit the fan moment. And it was and I did even did a YouTube video, got like 90,000 views and got a lot of hate.
00:36:56:16 – 00:37:03:12
Rod
You’re such an idiot. You know what I’m like. It was it was titled The Coming Crash of whatever year that was, and I was dead wrong.
00:37:03:15 – 00:37:05:03
Tyler
Well, they dumped $10 trillion.
00:37:05:03 – 00:37:24:05
Rod
Well, that does help a little bit. I mean, which is why we have inflation. Yeah, but anyway, so. So. Okay. Yeah. And. And so you buy these now. Now you know, there’s something to be said. One of the wealthiest guys in the world owns one of the largest manufacturers of mobile homes. What’s the name of the Clayton Homes.
00:37:24:05 – 00:37:34:13
Rod
Clayton Homes. Yeah. And and there’s some great quotes that he has around the mobile home park business. But did he also own parks as well, or did you own a bunch? There was.
00:37:34:20 – 00:38:00:04
Tyler
Yeah. Yeah. There was an interesting article that you know, your listeners can look up. Yeah. He ended up basically snapping up in central Washington a lot like 13 communities and then ended up raising the lot rent like 350% in one go. And he basically took away all the affordable housing in that area and made a monopoly. And it’s kind of interesting because it’s in between you know, it’s it’s in central Washington.
00:38:00:05 – 00:38:15:29
Tyler
You’ll right above Oregon. And it is there’s this kind of this coastal range that cuts off the of Seattle and not coastal, but there’s an inland range that cuts off Seattle from kind of inland Washington. So what you see there, you got to go over that mountain range to kind of get back to Seattle and get back to the coast There.
00:38:16:01 – 00:38:21:02
Tyler
And there’s nothing before you get to Idaho. So he knew that he.
00:38:21:02 – 00:38:23:01
Rod
Just eliminated all the affordable housing. Yeah.
00:38:23:01 – 00:38:32:06
Tyler
And and and he knew the apartment rents are so much higher so they couldn’t go there. Right. So he ended up just jacking them up and he got a bunch of newspaper articles. I think that was in 2000. He got.
00:38:32:06 – 00:38:33:23
Rod
13, but and he ended.
00:38:33:23 – 00:38:44:09
Tyler
Up exiting. He ended up exiting, Yeah. Because he was like, I don’t need this publicity, Right? Oh, wow. But it was interesting. Yeah. For the guy that wants 90% income taxes, you know, he’s. Yeah, he’s all about making money. Yeah.
00:38:44:10 – 00:39:07:17
Rod
Interesting. Interesting. Yeah, well, he’s a smart guy. Yeah. Just lost his partner recently. Yeah, but. Okay, so. So now let’s talk about how I was going to say asset management. I was going to say brain damage, a kind of asset management slash brain damage as it relates to mobile home parks. You know, my I know this business quite well because this is what exactly what my brother does and Kevin.
00:39:07:17 – 00:39:25:29
Rod
But with Kevin Bob’s portfolio, he works with Kevin and and owns a bunch of parks and his own parks forever and so talk about some of the things that come up, you know, when you own a park versus you know, they’d hear what happens with multifamily. So let’s talk what happens when you own a park some things that some good bad ugly.
00:39:26:00 – 00:39:45:22
Rod
You know, we talked a little bit about it already with Jason about, you know, the fact that, you know, if they if they don’t pay, they either move the home or they they you know, they lose it. Right. So and by the way, when that happens, if they’re on the bill, a sale on the title for that home, there’s like a repossession process.
00:39:45:22 – 00:39:49:15
Rod
Right. That you have to go through of some sort as a is it state specific or.
00:39:49:16 – 00:40:00:24
Tyler
Yeah, it is state specific, but but you know, 50,000 foot view, either you need to go through the abandonment home process, okay, Or you’ve got to evict them. You get the writ for the House, then you get a bonded title.
00:40:00:26 – 00:40:01:07
Rod
Bonded.
00:40:01:07 – 00:40:02:23
Tyler
Type, You get a bond. Okay. Yeah.
00:40:02:23 – 00:40:05:09
Rod
And the length of time on that is typically a couple of months or what?
00:40:05:09 – 00:40:11:05
Tyler
Yeah, it’s usually 120 days for the bonded title. Okay. Abandoned a home process is usually like 80 to 90 days.
00:40:11:05 – 00:40:25:14
Rod
Okay. Yeah. So three months you’re you’re back to back to square you back there. Okay so we’ll talk about, you know on the asset management side the sorts of that you deal with owning a mobile home park.
00:40:25:21 – 00:40:35:07
Tyler
Well, yeah, I just I want to make a disclaimer to your listeners as well that, you know, we bought in one of the highest, uh, murders per capita.
00:40:35:07 – 00:40:37:00
Rod
Yeah. That’s also got a bad reputation.
00:40:37:03 – 00:40:48:13
Tyler
Yeah. And so we when we took over, these properties were heavy, heavy turnarounds. I see. And so the, and the problems we dealt with when we first bought them and the problems we dealt with now are two different problems.
00:40:48:13 – 00:41:06:17
Rod
Okay, we’ll start. Let’s talk about what you dealt with when you first bought them. Yeah. Yeah. Because I owned properties in Memphis and I would equate them to, you know, Memphis is worse. Yeah, well, okay, fair enough. You know? Yeah. So. So what? What? So you had, you had drugs, you had all sorts of things to deal with.
00:41:06:17 – 00:41:06:26
Rod
Yes.
00:41:06:27 – 00:41:22:12
Tyler
Yeah. So, you know, I mean, when we first took over a property called Opal Estates, you know, I went in there with a vest and my air bag. A Yeah, Oh, yeah. Whole nine yards. We ended up tearing down three houses. One was a drug house, one a brothel.
00:41:22:15 – 00:41:24:11
Rod
We had to actually remove them completely.
00:41:24:11 – 00:41:26:28
Tyler
Yeah. Because the houses were just not, they weren’t, they weren’t savable.
00:41:26:28 – 00:41:27:23
Rod
Okay.
00:41:27:26 – 00:41:52:03
Tyler
And you know, there was another, another property we went into where we evicted one of the 18 spacers. Actually, we evicted 80% of the residents in there. And what? I served a woman with an eviction notice. I She didn’t like that very much. And she took a roundhouse swing at me and then fell down her steps and chased me out of the park and another resident spit on my car as I as I sped out of the park, I hightailed it out of there.
00:41:52:03 – 00:41:55:28
Rod
So know, you know, you mess with me. You mess with the whole trailer park.
00:41:55:28 – 00:42:07:28
Tyler
Yeah, exactly. Yeah. Yeah. You got Brian Urlacher over here. That you got. You got you got the wide receiver that’s running to run it out, running down the street. I mean it’s anyways it’s, it was pretty. Yeah. We had some really interesting stories and so how.
00:42:07:28 – 00:42:14:12
Rod
Did you turn it around. You evicted everybody. What did you do from a crime prevention standpoint if anything in these parks?
00:42:14:12 – 00:42:33:07
Tyler
Yeah. So what we did is really when we got rid of the bad characters, right, we started doing a lot of really heavy background and credit checks. We started in filling these parks with a lot of new homes, a complete turn the tenant base around, and then you never let your foot off everybody’s neck. If somebody breaks a rule day one, you go through and you hammer them.
00:42:33:07 – 00:42:39:05
Tyler
Right. And that’s that’s the only way to do it, because once once there’s a once, there’s one person breaking the rules to cancel it.
00:42:39:05 – 00:42:41:19
Rod
A little crack in the door. They they busted open.
00:42:41:20 – 00:42:42:09
Tyler
Exactly.
00:42:42:09 – 00:43:05:11
Rod
You know, it’s different than multifamily because multifamily, you buy an asset. You know, when you’ve got crime prevention, you’re going to throw in like like we’ve got an asset that we’re buying right now in San Antonio, 200 doors. It’s a mile and a half away from another asset. And there’s not a real crime issue there. But but we’re going to put in lighting, enhanced lighting, security cameras.
00:43:05:13 – 00:43:22:22
Rod
We might even get it. It’s already got some fencing around it. And just just look at lines of sight to make sure there’s no places people can jump get jump. But lighting is a big thing. Cameras are a big thing. And so there’s some things you can do that you can afford to do in a mobile home park.
00:43:22:25 – 00:43:43:05
Rod
You really can’t. You know, I’m sorry you a multifamily that you can’t in a mobile home park. So so okay. So you turn your attorneys around, you bring in new homes, they see you’re cleaning it up. You get rid of the riffraff and then you turn them into resident owned homes. What other sorts of things pop up on the asset management side?
00:43:43:07 – 00:43:54:28
Tyler
Yeah. So after that kind of gets done, a lot of people don’t take care of their homes, so the houses start turning green, right? So we’ve got a big initiative right now that we’ve sent out to all of our residents, basically saying, Hey, look for 100 bucks.
00:43:54:28 – 00:43:56:08
Rod
Well, pressure wasn’t pressure.
00:43:56:08 – 00:44:08:01
Tyler
Washer Exactly. And we’re losing money on that. But it’s like, look, it’s a good gesture to the community. Hey, we all will paint your house for 500 bucks. Wow. You know, those sorts of things we’re sending out to people to basically say, look, you know, we’re not.
00:44:08:01 – 00:44:10:14
Rod
If they say no or they don’t do it.
00:44:10:16 – 00:44:13:10
Tyler
Then we fight them out of the system. Yeah, Yeah. We find them out a lot.
00:44:13:10 – 00:44:14:26
Rod
Of care at first and then there’s a stick.
00:44:14:27 – 00:44:27:11
Tyler
Yeah, exactly. So we start finding them and those fines increase, you know, every the first three months of the same and then the last two months, they’re different. And then after five months or five of similar evictions within one year.
00:44:27:11 – 00:44:27:23
Rod
Similar.
00:44:27:23 – 00:44:30:10
Tyler
Fines. Yeah. So yeah, I’m sorry, Similar fines. We used an.
00:44:30:10 – 00:44:30:20
Rod
Eviction.
00:44:30:20 – 00:44:32:07
Tyler
Yeah, that was eviction. Exactly. Yeah.
00:44:32:07 – 00:44:38:03
Rod
Interesting. So you got that? Your lease documentation has that type of language in it. Good.
00:44:38:06 – 00:44:43:22
Tyler
Yeah. Because I mean without that your. Yeah. The residents just run you over.
00:44:43:25 – 00:44:55:08
Rod
So what’s, what’s the worst thing that’s happened from an asset management standpoint. One of your parks because there’s tons of them I know but what’s the worst that you come to or top two or whatever.
00:44:55:10 – 00:45:17:00
Tyler
Yeah. I mean I just, I just told a story on LinkedIn actually that I got a call about 1 a.m. in February from one of our managers actually at that same park that the lady would look like Brian Urlacher was out. Right. That there was a guy, my manager woke up to somebody tapping on the side of a unit and the property and this guy with the those guy with an ax and a gas can.
00:45:17:02 – 00:45:33:17
Tyler
And so she asked me, you know what I you know what I should do? And I said, Did you call the police? And she said she said, No, I’m call the police. I said, you know, I won’t swear on here. But I said, What do I look like, Billy? The Kid? Right. We were going to go down there with my six shooter and blasted out of his shoes.
00:45:33:17 – 00:45:49:04
Rod
You know, my brother laughs about that all the time because, you know, even the managers in these parks, you know. Yeah. Sometimes they need some help. Yeah. Yeah. As evidenced by what you just said. Yeah. It’s like there’s a common sense missing in that case.
00:45:49:04 – 00:46:14:18
Tyler
But yeah, and we’ve had everything else under the sun. We’ve had homes catch on fire, right? And we’ve had trees fall, three units we’ve had, you know, we’ve had, you know, we had one, we had our first portfolio that Jason talked about. We had a guy steal a truck from a gas station down the street, drive it up, try and evade the police through a park park that’s right next door to our park.
00:46:14:24 – 00:46:28:07
Tyler
He drove all the way. He drove the truck all the way through one of the homes, through our fence and into the back of one of our residents house, just like middle of the day. And then again, same sort of thing. Manager called me up. Tyler. Oh, there’s.
00:46:28:07 – 00:46:28:23
Rod
A truck in.
00:46:28:23 – 00:46:47:05
Tyler
The back of one of our residents homes. All the cops are here. And I said the same thing, like, What do you want me to do? What is the Wild West? I mean, again, would you want the police? Are there. I can’t do anything, you know. Yeah. So, yeah, there’s a lot of money Again, we brought we bought headaches, but we bought headaches because we thought the returns were going to be there.
00:46:47:05 – 00:46:47:16
Tyler
Yeah. So.
00:46:47:16 – 00:46:53:28
Rod
So do you have like, a training program or a training curriculum for your managers when they come online?
00:46:54:01 – 00:46:56:05
Tyler
Yes, but we definitely need to work on that. Yeah.
00:46:56:08 – 00:47:12:09
Rod
Yeah, I that’s one of the things I did, you know, in advance of getting into the business is I actually created a whole training thing. I don’t know if I still have it. If I do, I’d give it to you, but yeah, just, you know, every business is nothing but people in systems. You got to train the people and you’ve got to have the systems.
00:47:12:09 – 00:47:27:23
Rod
And, and that’s a, that’s a critical piece of this for sure. You know. And would you agree with me, finding good managers is one of the toughest things you do. Absolutely. Yeah. Yeah. That’s my brother tells me the same thing, you know, and you go through people and and all that.
00:47:27:23 – 00:47:34:19
Tyler
I was I was actually listen to your guy to your podcast last night. Oh, about the airline pilot.
00:47:34:22 – 00:47:35:10
Rod
Oh, yeah.
00:47:35:10 – 00:47:38:11
Tyler
Yeah. E Smith I actually, I actually just ordered that book was.
00:47:38:11 – 00:47:45:13
Rod
A great book. Michael Gerber about systematizing your business. That was Steve Rosenberg Yeah. Sad story about his boy. Did you hear the whole thing?
00:47:45:14 – 00:47:46:01
Tyler
I did not.
00:47:46:02 – 00:48:09:16
Rod
If you listened the whole episode, it’s pretty gripping. Yeah, I won’t taint this one with that, but yeah, but anyway, yeah, yeah. Every business, nothing but people and systems. So if you get that right and you get the right people like Brook up there behind the desk, hiding behind the desk, you know, and then you put the right systems in place, then you’ve really got a home run.
00:48:09:18 – 00:48:23:25
Rod
So what do you think’s going to happen in the whole mobile home park industry? Because you really can’t build them anymore. Nobody, nobody’s allowing them and nobody wants a mobile home park in their backyard. So what do you see for the industry? Do you still do you think there’s still deals out there?
00:48:23:27 – 00:48:43:27
Tyler
Yeah, I do. I mean, I think there’s deals. I mean, it’s actually funny. Our pipeline is kind of the fullest it’s ever been. Has we got nobody’s calling anymore. So these owners we’ve been following up with of three or four years are now calling us being like, well, hey, I want to sell you know and so and we’re we’re negotiating some interesting older financing and stuff like that.
00:48:43:27 – 00:48:52:27
Tyler
So the the industry I think is I think it’s a it’s a good time to buy as long as you can. You’ll find some good seller carry or have a park that’s discounted enough to make the debt service work interesting.
00:48:52:27 – 00:48:58:11
Rod
So it’s one of the other. Typically, Yes. Okay. So it’s either seller financing or because of the interest rates right now, right?
00:48:58:12 – 00:48:59:05
Tyler
Okay. Yeah.
00:48:59:06 – 00:49:03:09
Rod
Yeah. Okay. I didn’t even make that connection right there. Okay. Yeah, sure. Yeah.
00:49:03:09 – 00:49:20:19
Tyler
And so and I think the state of the industry is really interesting with with parks right now because there’s less than 10% institutional ownership. And so there’s a lot of opportunity for people that like, you know, maybe that don’t have as much capital to go out and or or don’t want to partner with, you know, six or seven people to maybe go out and buy an apartment complex.
00:49:20:22 – 00:49:21:27
Rod
They can go out and buy a mobile home.
00:49:21:27 – 00:49:25:03
Tyler
Yeah. Like we bought 22 spaces for, you know, 289.
00:49:25:06 – 00:49:44:21
Rod
Okay. But don’t buy 22 frickin space. That’s by at least a 50 unit. Otherwise you’re going to be managing it. And I can’t think of a worse nightmare than that. But. But yeah, I agree with you. And I love the business. I actually love the mobile home park business. And I regret not trying to do both the same time.
00:49:44:21 – 00:49:52:10
Rod
But there’s only wanted me to go around so but and and so so you’re seeing deal flow. Yeah that’s that’s awesome one.
00:49:52:11 – 00:49:55:09
Tyler
I think there’s gonna be more consolidation in the future you know you.
00:49:55:09 – 00:50:13:29
Rod
Know that’s interesting you say that because I was just talking about you know Kevin Buss got a huge deal they’re trying to take down, right? Yeah. Yeah. I don’t remember how many space. 700 and 750 spaces. That is an institutional great deal. Yeah, I know. They’ve had a couple of hiccups my brother was telling me, but, you know, huge equity raise on that thing.
00:50:13:29 – 00:50:16:01
Rod
But you know, he’s, he’s, he’s doing it.
00:50:16:01 – 00:50:19:00
Tyler
So Yeah. I mean and that’s yeah, that’s the time to.
00:50:19:01 – 00:50:22:28
Rod
Set your goal as well as what you guys see yourself want to do get some bigger deals.
00:50:22:28 – 00:50:39:24
Tyler
Yeah we absolutely do So and the only reason our deals worked kind of in the Little Rock area is because we we got some economies of scale. So we’re the largest private owner in Little Rock, right? And we’re the largest private owner in the state right now. There’s some there’s some publicly traded companies that are killing us out there right that own way more units than we did.
00:50:39:24 – 00:50:43:05
Tyler
But right now that’s that’s we that’s that’s what we are.
00:50:43:05 – 00:50:49:13
Rod
And we are economies of scale, like with your maintenance and your what are what how else does that come into play. Management as well. Management.
00:50:49:13 – 00:51:05:12
Tyler
Yeah, because you really can’t hire somebody. Like if you think about that, like you bought a what is that 20 space mobile home park. It’s 350 a month or a 2020, you know, 20 door apartment building. That’s a thousand a month. Right? Right. Those fixed costs just for basic fixed costs, like paying a living wage to a manager.
00:51:05:13 – 00:51:05:29
Tyler
Right, Right.
00:51:05:29 – 00:51:22:23
Rod
You can’t, you know, 28 apartment complex. You’ve got to hire a management company. You’re going to pay probably 10% management fee or 7% management fee because they’ve got to go do the showings. They’ve got to handle coordinate all the maintenance, They’ve got to handle everything that an onsite person would handle. If you had could afford an onsite. Right.
00:51:22:24 – 00:51:36:10
Rod
I used to I used to tell people you need 88 apartments to have it makes sense. But with rents going up as high as they have, you can do, you can have on site people with less than that now. But do you think it’s 54 mobile homes or do you think it’s less.
00:51:36:13 – 00:51:56:12
Tyler
It’s probably I mean, for a paying a living wage, it’s probably a little more. It’s more probably, yeah, it’s probably 75, 80, I think just in the Little Rock area. And we’ve got 400 units in in Little Rock and they’re all within kind of five miles of each other. And, and we just kind of got to the $60,000 for one manager that kind of circles around.
00:51:56:12 – 00:51:58:09
Rod
Like a regional that’s managing all the.
00:51:58:11 – 00:52:11:22
Tyler
All the little guys. Yeah the 18 space the 22 space is 68, you know. Okay so she kind of she bounces around all these different degrees, different park. So but then there’s also the logistical nightmares there, too. They say that gas is so high now that they want to step in.
00:52:11:25 – 00:52:18:06
Rod
Of course not. Not. Have you got maintenance on your payroll? We do, Yeah. Yeah, course you do. Okay, good, good, good.
00:52:18:10 – 00:52:20:01
Tyler
And they travel actually, all around the state for us.
00:52:20:01 – 00:52:34:27
Rod
Oh, do they? Yeah. Yeah, that’s good. Yeah. Well, listen, guys, I really appreciate you coming down here. This has been a lot of fun, and I can’t wait to see you get to the hundred thousand units when you. You know, when you hit, let’s say 10,000. I want you back at that point. Well, at that point, we’ll have to microphones.
00:52:34:27 – 00:52:38:18
Rod
Yeah, I promise. But it’s a pleasure to meet you both. And I appreciate you coming down.
00:52:38:19 – 00:52:39:23
Tyler
I Right. Thank you much.
00:52:39:23 – 00:52:40:11
Rod
Absolutely.
