Boroughs & Burbs, the National Real Estate Conversation
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Boroughs & Burbs
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Boroughs & Burbs, the National Real Estate Conversation
Boroughs & Burbs 181 || Mobile Homes and Parking Lots
In Season 5, Episode #181 of Boroughs & Burbs, we dive into an often overlooked but lucrative niche in real estate — mobile homes and parking lots. Our guest, Kevin Bupp, a seasoned real estate investor, shares his expertise in this unique market. Kevin has built a successful career by focusing on mobile home parks, offering valuable insights into the benefits and challenges of investing in this sector. He'll discuss strategies for generating passive income, navigating zoning and regulatory challenges, and why mobile homes and parking lots can be a smart long-term investment. Whether you're a seasoned investor or just starting out, this episode offers essential tips and a fresh perspective on profitable real estate opportunities. Don't miss it!
The Burroughs are New York City. The Burbs are everywhere else. Real estate is the ultimate game of risk and reward. It's the biggest investment most people ever make. Fortunes are made over a lifetime and lost in a day. And we're not playing with monopoly money. How do you stay ahead? Who's buying? Who's selling? And why? What do they know? We want the truth. You need an edge. Burroughs& Burbs is your secret weapon, giving you the insider knowledge and strategies you need to succeed in the high Welcome everybody, Burrows and Burbs, number 181,
SPEAKER_04:mobile homes and parking lots. I got that wrong a little while ago, and I said mobile homes and trailer parks, and I was immediately corrected by our guest, an expert in the subject. So that's probably going to be one of our first questions. But before we begin, I want to thank our sponsor. Thank you, Grace Farms. You'll find them at gracefarms.org. We love you, Grace Farms. You can go to Grace Farms, enjoy the 80-acre campus, the river building, and you can have their specialty teas and coffees, and you can give them as gifts to your clients. We are brosandburbs.com, and you can find all the past episodes there. I want to thank my co-host, Roberto. I checked out your... market report from a month ago, and it said, my colleague said you sold us out. Very provocative. And then I noticed that this month, it's buy, buy, buy. You have one year to buy, and here's why. So if you want to know the answer to that, you're going to have to go to RobertoCabrera.com and check out the current market report. That's me. You'll find me at TheAngleTeam.com. I'm John Engel in New Canaan, Connecticut. This is my weekly column. This week, I say it's not a rally, it's a relocation. And I think I quote Roberto's optimism, his sunny optimism on the New York market in there. And then I say why Roberto's wrong. So you're definitely going to want to connect to that. And with that, this is Kevin Bup, our special guest. Welcome, Kevin. How are you doing? Where are you calling in from today?
SPEAKER_01:Well, John Roberto, first of all, thanks for having me. Excited to be here. I'm speaking with you from the Tampa Bay area. I've lived here with my family for the last 20, 23 years now. So warm and sunny Tampa Bay.
SPEAKER_04:Why Tampa Bay? Is that a place where you need to be to do your business or does your business exist everywhere?
SPEAKER_01:That's a great question. I mean, today our business exists everywhere, but to answer that question better, you got to go backwards to the age of 22. I grew up in Pennsylvania, Harrisburg, Pennsylvania, to be more specific, central Pennsylvania. It is the capital for those that don't know. A lot of folks think Philadelphia is the capital, but Harrisburg is, but there's not much going on there as far as the capital city is concerned. And so for that reason, you know, just I wanted to move to a more progressive city. I wanted to move to somewhere where there was sunshine, you know, 11, 12 months out of the year. Even growing up in the cold, I never got used to it. Never got used to those six months of gray skies, you know, getting dark at 4.30, 5 p.m. in the evenings. I just, it drove me crazy. And so when the time was right, I had a couple years of real estate investment experience under my belt. I chose an area that I really wanted to live. And so it was between basically somewhere in Florida or somewhere in the mountains. Denver gets 300 plus days of sunshine a year. It was either going to be Denver because I love the mountains. I love snowboarding, love skiing. or I love the water, love boating, love the ocean. And just, you know, I came to Tampa, spent a year here and I fell in love with it. And so here we are today.
SPEAKER_03:I grew up in Hagerstown, Maryland, so.
SPEAKER_01:Okay. Yeah. Not too far away.
SPEAKER_03:And I left there too.
SPEAKER_01:Yeah, you know, and nothing wrong. I mean, all my family's up there. I've got a lot of friends still up there and they absolutely love it. It's a gorgeous place in the summertime. I just, I choose to be where it's warm most of the year and where the sun shines and there's, you know, plenty of oceans and lakes and just a lot of water activity. That's really what gets me going.
SPEAKER_03:So Kevin, how did you get into this?
SPEAKER_01:Yeah, great question. And I've owned just about every type of real estate now over the last 20 years. But basically, when I was 19, I graduated high school. I wasn't really all that academically driven. I kind of just skated through by the skin of my teeth. And then a lot of my friends went away to school, and I knew that wasn't for me. I'd always been an entrepreneur. I had a paper route at the age of 12. Prior to that, I shoveled snow. I mowed grass. I did whatever I could do to make money. I didn't grow up in a rich family, so I wanted to be able to buy, back then, the cool things, sporting equipment, BMX bikes, dirt bikes, things like that. And so I always started working at a young age. I always tried to hustle and make money. And then, you know, but, but college in my mind, that wasn't the way entrepreneurism, like that wasn't a, that wasn't a term back then. That wasn't necessarily a cool thing, you know? And, and it wasn't necessarily even supported, right. It was like, go to school, get a good job. And otherwise you're going to be a loser, right? Like that's, that's, that's what was ingrained in me. And so I felt pressure to go, but I knew if I went, I would have probably partied
SPEAKER_04:harder. You're going to be a realtor when you grow
SPEAKER_01:up. Yeah. Well, so, so, So I went to community college. I was like, okay, I'm not gonna waste my parents' money. I'll go to community college, but didn't have direction at that point. I just, I was going there, taking generalized classes. And through a girl I started dating, I met her mom's boyfriend. Her mom had recently gone through a divorce, our dating guy. And this guy just happened to be a local real estate investor. It was a foreign thing to me. My parents didn't have any friends that were business owners. Both my parents worked full-time jobs. We didn't know any business owners. His name was David. I got to know him just from going over their home and tried to better understand what he did. To a simple sense, I knew that he owned rental properties and he lived off the cash flow. That's what I understood from the basic sense of it. But as I got to know him more, I saw flexibility in his life. I saw he had just a different swagger. He just seemed to live a very different lifestyle than what I was used to growing up and And at that age, material things were very important, right? I want money so I can buy cool cars, cool clothes, go on cool vacations, those types of things. And through a couple months of becoming friends with David, he just happened to invite me to a real estate conference in Philadelphia. It was a three-day conference. His business partner couldn't go. I attended with him. And I didn't know what I was going to learn. Again, I had never read a book on the topic. Again, all I knew was that he owned rental real estate. I didn't know how he bought it, how he got the money for it. any of those things, how he fixed and rehabbed it, how he dealt with tenants. And so I went to this conference with him and I was overwhelmed by just the, in my mind, the success that I saw in the room. But it, you know, What I gathered from the success was that the folks that were really successful and doing well, they weren't really much smarter than I. The folks I talked to, they just knew something I didn't know. And so I came back from that conference. I didn't want to lose the excitement. I knew it would just kind of dissipate in the thin air and I'd go back to the normal routine again.
SPEAKER_04:Quick question. That conference was full of entrepreneurs, investors, real estate professionals. Real estate conferences that I've been to aren't that exciting. So talk to me about that. Like who's in the room and why are you so excited?
SPEAKER_01:Yeah, guys, you know, folks that were, that had businesses that were fixing, flipping homes or wholesaling homes. Those were the two kind of categories that they were teaching about there. And, and, you know, I sat, I sat, there was two married couples that sat on either side of us and I got to know them during the conference. Both of them, for the most part, focused on both fixing and flipping, but then also did a rental portfolio. One owned about 40 rental homes. The other one owned, I think, you know, 60 or 70 units. And, and, I got a good understanding of what they made on their normal flips, which was anywhere from 20K to 50K on a flip. And then what their passive income stream looked like from this portfolio they had built up over the last 10 years. And so that just got me super excited. And so I came back. I made David an offer he couldn't refuse. David was a solopreneur. He was really successful. What year was this? What year was this? This was back in 1999. Back in 1999. Is it fair
SPEAKER_04:to say you got to time this right? That this is not always... the right year to do what you did and start your cycle. Yeah, I mean, I think there's always... Did you catch it at the top when it was exciting?
SPEAKER_01:No. Or at the bottom? No, it was... You know, that's funny. I didn't even... That wasn't relevant to me at that point in time because it is to me... It's
SPEAKER_04:not relevant to any... I have a college son. And so if he said, oh, I want to do this, I'd have to start thinking about, well, are we heading into a downturn or an upturn? And, you know, because... I joined real estate in 2008, just as the bottom was falling out of the suburban market. So your business is historically very volatile and cyclical. Absolutely.
SPEAKER_01:Absolutely.
SPEAKER_04:And so I want to get into that.
SPEAKER_01:I mean, the fundamentals don't change. I mean, we've literally had... the best two years in our growth years in our business, these last two years when all of our competitors have been on the sidelines, haven't been able to buy, their liquidity dried up, what have you. And so, but most of that's because we were really conservative in 2020, 2021, 2022, when folks were kind of stretching, you know, getting out in front of their skis, maybe buying things they shouldn't have because things only go up, right? Rates are only going to stay low for forever. And so anyway, we can get into that topic at another time. But I think, I think, Every part of the year, every part of the cycle is a good time to buy. You just have to really be an expert at your craft, know what you're buying, have a good general understanding of what worst-case scenario is, and can I manage through that? Don't just underwrite the best-case scenario, which is what most people do. They just underwrite a pro forma, and that's literally if everything goes right, all the stars align. But as we all know, that just doesn't ever happen. Performers never write either going to... you'll exceed your mark or miss the mark. You're never going to land right on it. What I hear you
SPEAKER_04:saying is you begin by saying, I can make a lot of money and I can have a flexible lifestyle and I can live anywhere. I can do this out of Florida. I can do this out of Denver. It starts with the entrepreneurial vision. I want to make some money and I want a flexible lifestyle and I want to work for myself. Then you found that house flippers are were basically an exciting way to go, but you didn't end up in house flipping. I thought.
SPEAKER_01:No, I didn't. I didn't. You said, oh, that's
SPEAKER_04:interesting, but I want to specialize.
SPEAKER_01:Yeah. And there's a long 20 plus year evolution, right? Of buying single family homes, which is why I start with, I don't like reinventing wheels. If I find someone really successful in an area of their business, David was the only guy I knew really like that, that was close to me and he had a rental portfolio. So in my mind, I don't want to go, you know, he always, he wasn't a big fix and flip where he's like, look, I fix things up and I rent them. I hold them because wealth is created in long-term holds. And so I was like, okay, I'm not going to argue with you because I don't know any different. And so you've seemed to be done really well in your life. And so I'm I'm going to do what you're doing, David. And so that's what I did. I bought the first property at the age of 20. Um, I went to work for the part I skipped. I went to work for him for a year and a half. That was the offer he couldn't refuse. I went to work for him for a year and a half for free in between classes. And I attended bar in the evenings and I would literally go to his home office. I'd go out in the field. I'd, pick up material, I'd drop off leases, pick up leases, answer phone calls, return phone calls, whatever he needed, I would do. And the biggest help I was for him is just, he was that guy, he was a solopreneur, but he thought he did better, everything better than everyone else, right? And so he never had an assistant, which he really needed. He didn't rely upon GCs or anything like that. He kind of did everything himself. So I just kind of stepped in and took some of that admin BS off of his plate. And by doing that, I learned the business inside and out. I heard what he said, and he said it, why he said it, who he said it to. And it took me about 14 months of just being around him before I pulled the trigger, bought my first property. And I learned very quickly that the buy and hold strategy that David leveraged, which he had been doing this now for 20 plus years. I bought that first property, got it rehabbed, leveraged a lot of his resources. I met a lot of people through knowing him and I got it rented and it threw off, you know, shy of$300 a month of positive cashflow. But I used pretty much every dollar I'd save up tending bar to buy that as a down payment. I had a private lender that financed the rest. And I realized that there's no way I'm going to be able to buy another property anytime soon because I just used all my money here. And that 300 bucks a month that's throwing off, it's going to take a very long time to save up enough to buy the next one. And so I modified the business plan, started basically wholesaling a couple of properties, you know, just not fixing them up, just wholesaling them and then holding maybe every three or four, right? Wholesaling
SPEAKER_04:means you buy it at
SPEAKER_01:other people's money or you just move it. Sometimes it's just signing up a con back then. It was legal at some states. It's illegal now, but just literally signing up a contract for, for X price and then selling it for Y price and then making the spread in the middle without doing anything, but basically identifying a great property for below market value. And it's selling it to the most of you that were buying from me were folks that were going to fix it. They were going to fix it. They were investors, but they wanted to go through the entire process and life cycle and fix it up to its completion. So, but that, that was the initial model. And then it just, it morphed from there. I did build up a, quite a big, Rental portfolio in my early to mid-20s, got into multifamily investments, started dabbling in other types of commercial real estate, retail office back when it was cool and it was a good thing to be invested in, self-storage and some industrial. And then, I guess trying to fast forward to where we're at today, I lost everything in 08, took a three-year hiatus. Bought my first mobile home park, which is what we own today. Bought my first mobile home park back in 2011. Why did
SPEAKER_03:you buy
SPEAKER_01:that? Yeah, that's a great question. I never had intended to buy it. I didn't know anybody that had owned mobile home parks. Honestly, I did a look back kind of valuation when I lost everything about what my business looked like, where the mistakes were made. And now second time around, how can I do this again and not go through the same chaos that I went through the first time around? I was just about to
SPEAKER_04:ask you, do you have to fail? Is it a truism that everybody in the mobile park business has to fail once before they learn the lessons you learned, which is we have to get real conservative with our spreadsheet and our projections? And that's why you're saying all of us who've never bought a... got into real estate before, we can learn from you. We should have a mentor like you who's not going to let us get into trouble.
SPEAKER_01:Yeah, I mean, I think everyone, I mean, if you're going to be an entrepreneur, I mean, you're going to fail multiple times. I don't look at it as failure, though. I just look at it as lessons. I mean, how do I do it better a second time around? How do I not make the same mistakes again? I mean, you guys are entrepreneurs. You've spoken to hundreds of thousands of entrepreneurs, and you'll find the most successful ones have had many more failures than they've had wins along the way. And, uh, you know, but typically the wins are so significant that they triumph all the failures, right. And they wouldn't get to that, that win without all those failures along the way. So, um, you know, it was a, it was a chaotic time. It was rough three years. I literally lost everything. My primary residence, it wasn't mobile home parks. So it was a single, I had about 122 single family properties and a couple hundred multifamily doors. It was down here in Florida, Florida, Florida, the economic base of Florida was especially Tampa Bay was very different 20 years or 15, 16 years ago back in 08 than what it looks like today. It's much more diversified in nature from the employment base. And it's just the population growth that we've seen over the last 10 years. It's just it's a night and day difference of what it looked like back then. And the biggest challenge we went through back then was there was a this is, you know, back with the, you know, basically you could fog a mirror, get a mortgage. The amount of spec homes that were being built in Florida, all the major markets, Orlando, Tampa Bay, Miami, Jacksonville probably experienced a similar thing. the population wasn't coming here for it. And then on top of that, all the, basically a lot of the job base here was built around construction or the real estate industry. And so when the mortgage crash, right? Yeah. Yeah. But, but there were, there were so many rooftops that were being built. This is back when some homes pre-construction would get flipped three times, right. For a profit. And that's just nothing that this is sustainable. So like when, when the market finally crashed, you had a lot of builders had new home inventory. They started renting them out. We had a rental portfolio. I mean, literally there's more homes than there are people. And also now people have bad credit, people have lost their jobs. And so we just experienced a point in time where we had a, not a mass exodus, but we went from 98% economic occupancy to about 82% economic occupancy within a matter of like four or five months. It was insane. And it got below that. And then the value slowly- 82 is not great. I mean, not when you go from 98 to 82. I'm thinking about like
SPEAKER_04:American Airlines. And if they if they got 82 percent on their flights, they're probably like, OK, I can make money at this.
SPEAKER_01:I would say about 80 percent was about our break even with our debt service. But we dip below that for many, many months. And on top of that, the value is literally, you know, we had a pretty before the crash happened. our loan to value across our entire portfolio was below 60%. So one would argue that that is incredibly conservative. You know, there's a lot of buffer there, but the majority of stuff we own within a year was underwater. It was below at least half or less than what the original value was. Sometimes way less, sometimes 30 cents in a dollar. And you couldn't restructure the loans. You had to actually
SPEAKER_04:go bankrupt.
SPEAKER_01:Yeah, so I didn't go bankrupt. I never filed bankruptcy. I am proud of that. I worked my way through it over many, many, many, many years. But no, because what ultimately occurred is this was such a new thing for these banks. None of them had workout departments. None of them were ready for this onslaught. And so Most of the banks I had relationships with were local community banks, and their books were already a mess. I mean, their portfolio was a mess across the board. They didn't have the wherewithal, the manpower to manage it. They didn't have the structure or the mechanism in place to actually do workouts right out of the gate. Maybe a couple years into this, they did. But so I didn't have options. They weren't willing to have that discussion. They're like, basically, you got to pay these loans in full. I don't know what to tell you. And I didn't have the ability to do that. There was no equity left. We couldn't refinance them. The mortgage market had completely melted down. And so it was basically, you know, cross our fingers, do as much as we can to get good residents in there, to get them to pay, to renew leases. But that was tough. We had to cut rental rates. We had to give concessions. We still had a ton of vacancy on top of that. A lot of our maintenance guys left. I mean, they're just, they saw kind of the writing. So a lot of our workers kind of moved away. It's hard to find new workers to replace them with. And it was just a tough time. I mean, it was just like all the stars aligned in a bad way, and I couldn't find my way out. So when you
SPEAKER_04:fail– so
SPEAKER_02:let's
SPEAKER_04:get to the present. So when you fail at single-family portfolio, mostly because the economy was so bad nobody could make money, and you come out of that, why trailer parks or parking lots or mobile homes
SPEAKER_01:did you just
SPEAKER_04:–
SPEAKER_01:Yeah. So what I saw is that my single family stuff back then was very inefficient, the management of it. I owned it in five counties. This is back before you could do virtual showings and lots of online presence. So we were physically putting out for rent signs and had leasing agents drive around doing showings. And it was incredibly inefficient.
SPEAKER_04:Because Roberto and I and every other realtor in the country gets a call occasionally from somebody who says, I think I want to buy real estate and rent it out. I want to buy this. Can you find me something I can rent out? And I say, well, what were you thinking? And they identify something, and I'll say, you know, the rental on that, you're going to make 5%, 6% of your money. And they're like, that's good, right? And I'm like, no, no. That's not enough to actually... borrow money at 6% now and turn it all over, you're still, you're going to be on underwater on day one. And they, a lot of, a lot of people don't understand that. It's one of the reasons, I guess, why you went, there's so little margin for error is why you went under. Now, what kind of return are you looking
SPEAKER_01:for? Our margins weren't thin back then. You could buy a$100,000 house and rent it for$1,000,$1,100 a month. I think it's very different today. There's probably still parts of this country, I'm sure some in the Midwest, where you can actually buy a home and actually make a decent return, probably 8% or 9% renting it.
SPEAKER_04:I've asked Roberto, can I buy and rent it out in New York? And he's like, no, you cannot run that business, John. Yeah.
SPEAKER_01:Maybe in Indiana or Ohio. I'm sure there's markets where you can make the numbers work, but it's- Can we get
SPEAKER_03:back? I want to get back to you. You saw this. What did you identify and how did you say, this is a business model that I think I can make work?
SPEAKER_01:Yeah. Simply put, the rebuild stage, I had identified that multifamily, my multifamily properties were way more efficient, hands down. And it took me, I could go buy a 120 unit apartment building the same time it took me to buy one single family home. And I busted my ass to buy 122 single family homes. And so I knew the next time around, now I was I'm married now. Fast forward. I got married in 2010. We wanted to have kids and I'm like, I need time. I need to find some, I need to rebuild, have a life work balance. I need to be more efficient and smarter with this rebuild. And so I thought it was gonna be multifamily. I met a guy, um, an ex banker. He had recently retired here locally, um, had lunch with him. He had known mobile home parks. I mean, it was that that's the first thing I'd ever, uh, first time I'd ever talked about mobile home parks, but this two hour lunch we can have with his name was Randy. Um, he piqued my interest in so many ways and he intrigued me that I left that meeting and had a complete change of plan. Uh, had committed at that point to go buy a mobile home park and, and, and either prove or disprove all these great things that Randy had said about the asset class. And so I did that. I went and bought, made a lot of offers, looked at a lot, got cold feet a million times, but ultimately bought the first one in Atlanta back in 2011. It was a 34 space mobile home community and it was complete rundown. REO had been sitting vacant for a couple of years, turned it around, stabilized it, did a cash out refinance. So it was sitting
SPEAKER_03:vacant, meaning it was just to keep the land.
SPEAKER_01:No, it was an interesting story. And it's not- It's a shocker. When you say that, we're like,
SPEAKER_03:oh, my
SPEAKER_01:God. Yeah, it's not common what we buy today. Basically, the old owner went and bought 34 brand-new trailers a couple years prior, took out a bunch of debt on it. He was kind of a slumlord, so he ran it like a slumlord. So even though he brought brand-new homes in, he continued running a slumlord. And he defaulted on the note, got taken back by the bank. And the special servicer took it over. And for some reason– Unknown to me, they actually made all the tenants leave. They were all rental units. They didn't own the homes. They were rental units. So they vacated all the tenants. And so it sat there. vacant, obviously got vandalized. People sold the AC units and all that. So when we bought it, we bought 34 mobile home lots on a three acre parcel of land, but there was 34 mobile homes that were all, you know, five, six, seven years old, all in need of renovation, but all vacant. So no income whatsoever. And so we dove in headfirst and got a couple of construction crews together. In retrospect, it was a
SPEAKER_04:good idea? Knowing what you know now, would you buy that
SPEAKER_01:at that terms? It wouldn't be a good fit for our business today. It's a little too small. I mean, it's just there's always so much bandwidth and resources we have and they're better spent in our organization today buying larger properties at a larger scale. Should Roberto
SPEAKER_04:and I buy something small like that? I don't
SPEAKER_01:know. Let me tell you. I paid$284,000. We put about$200,000 of rehab into it. Did a cash out refinance in month 13. Pulled all of our original capital back out of it and appraised for$1.3 at that point in time. And I just sold it like three years ago. I held it for quite some time. I sold it three years ago. I think we sold it for$1.6 or$1.6 five, somewhere around there. I would say that was worth it. What
SPEAKER_03:does a park like that need to have? Does it need to have gas? Does it need to have water? I mean, what are the structural things? You want me
SPEAKER_04:to pull up the case studies, Kevin? Yeah.
SPEAKER_03:No, but I mean, generally, you go there, what are the things that you need to be concerned about? What
SPEAKER_01:amenities
SPEAKER_03:do you have to be provided in order to classify it as a mobile home park?
SPEAKER_01:It doesn't need amenities. I mean, we own some communities where there's zero amenities, meaning that there's homes in a community, but there's no clubhouse, there's no swimming pools. I don't mean stuff like that
SPEAKER_03:necessarily. I mean things like running water like gas pumps, things like that.
SPEAKER_01:Yeah, no, I mean, it's just like, think of a single family subdivision. It just happens that we own the entire parcel of land that has all the homes on it. So you need water lines, you need sewer lines, you need roads. Some of them have gas, some are all electric. It just really depends on the part of the country that it's in. And so literally the same elements that you would have in a single family subdivision are the same elements infrastructure wise that you would find. This is the recent community that we just purchased December of last year. This is about 15 minutes outside of Ann Arbor, Michigan. Absolutely. It's also a gorgeous community owned by the same family. They developed it about 40 years ago. It's got a big, you see a big fountain in the, in the pond in the front. This looks like a single family subdivision. It's got all the elements of a single family subdivision. It's got tennis courts. It's got basketball courts, two playgrounds, a big walking, a walking path around the pond. And all these residents own their own home. They basically, they lease the land that their home sits on. And that's where we make our money. We make our money by owning the entirety of the property, providing them a amenities, providing them infrastructure, maintaining the infrastructure. And for that, they, they pay a monthly lot lease.
SPEAKER_03:So if someone wants to, let's say someone, they own their home, they have it on your land, they're done. They want to, you know, say someone passes away or whatever, they're done. The family comes by and say, listen, we want to dissolve ourselves with this. Do they pick up that house and move it away or do they sell it to you or what happens?
SPEAKER_01:That's a great question. I mean, technically they could pick, these are mobile while it takes a professional licensed mover to move them. And cost money to move them. They are mobile and they can be moved. And so they, they, they sure that they can be moved. However, what typically happens because it's such a costly endeavor to move them. Um, it's just, uh, it's a lot of effort to find the right people to do it. Most of the time, what happens is they put it up for sale, just, just as though they lived in a single, a regular single family home. They put it up for sale with a realtor or they put it up for sale by owner. Um, they put a sign out in their yard, but they, you put it on Facebook marketplace, whatever, whatever method, um, is viable in that, in that, in that particular marketplace, they'll put it for sale, they'll sell it. While they're marketing it for sale, they'll continue paying their lot rent payments to us. Once they find a prospect to buy it, that person will come through our community. They have to get qualified. They have to make sure that we don't want to just them selling it to any Joe Schmel. We want to make sure they don't have felonies and criminal backgrounds and things like that. But once they get qualified by our community, that new person assumes, new buyer assumes the lot rent responsibility and we continue going on and they're the new homeowner. I would say that over the last 10 years. We own about 3,500 lots a day. We've owned probably anywhere about 7 or 8,000 over the time we've been doing this. I can count on two hands how many homes have actually left our community. If they do leave the community, it's because We actually, it was too old. When we bought the community, maybe the home was too old. It was run down. No one was living in it. And we just tear it down. We bring a new one in. We'll tear the old stuff down and bring a new one in. But very rarely do actual residents take that home and move it somewhere else.
SPEAKER_03:As a purchaser of, like, I want to live in your mobile park, what are my considerations?
UNKNOWN:Yeah.
SPEAKER_01:Yeah, obviously the neighbors, neighborhood, management, amenities. Again, just like the things you look for. I like the
SPEAKER_04:design of this one. I like all the diagonals.
SPEAKER_01:Yeah, so that's an interesting community. We bought that one at the end of 23. It actually was two communities that got merged into one, not by us, but by a prior ownership. But it's huge. It's 738 sites. I mean, it's the size of a small city. That's in Fort Wayne, Indiana. Yeah. But back to you. I'm sorry, Roberto, your original question. I lost my train of thought there.
SPEAKER_03:Well, like as a buyer, like what just what are my considerations when I'm coming there? Like I'm concerned about what and what do I have to, you know, aside from my essentially lease payment to you, what else do I need to be concerned about?
SPEAKER_01:you know, assuming the house is there and they're buying a house that's already in place, it's already said, it's got utilities hooked up. And it's the same things that any other, you know, maybe family that's moving to an apartment or a regular single family home might take into consideration. If it's a, if it's a family, they've got kids, you know, what's the school district, you know, where the public schools, how, how far away are they? Is there a bus route here? Is there a bus stop inside here? Is there, you know, what type of amenities, swimming pools, you know, are there other families that live in here? If not, if it's a senior, maybe if it's a senior couple that are looking for a place, Hey, you know, How many families are here? Maybe I don't wanna be here because there's too many kids running around, right? I want more of a 55 plus, you know, age restricted community. But again, just to make sure that they're in the right part of the marketplace that there's, you know, It's safe. It's clean. It's quiet. It's kept up. Again, because really the responsibility of us being the community owner is make sure that the roads are in good shape, make sure that the common area is in great shape, make sure that we're enforcing rules. You never want to live next to the neighbor that has got 80 potted plants outside and a car with flat tires and they're changing their oil in the driveway. It's showing that the actual community is enforcing the rules and and creating consistency across the board. I would say those are some of the big ones.
SPEAKER_03:How difficult is it to go into these municipalities? I mean, like you're in Fort Wayne, you're in Atlanta and to understand the local knowledge of taxes, how they feel about it, what sort of money you can get from them. What's the, you know, how the, you know, how often they, you know, deal with the sewer system, you know, all that types of stuff. How difficult is it to get that local knowledge?
SPEAKER_01:Yeah, no, it's, I mean, we rely upon a lot of experts when we were going through due diligence, we hire, you know, we'll hire local council, engage local council, local engineers, folks. folks that know the planning and zoning laws. So we'll just really lean on the resources that are there at the local marketplace. And then on top of that, we typically don't buy smaller communities. And kind of back to the point of you asked the question about would I buy that very first community we bought up in Atlanta, would I buy that again? And while it was a great deal, we made a lot of money, it's just not of a sizable enough scale to where If we're going through due diligence, we're spending a lot of times$50,000,$70,000,$100,000 before we buy a community, and that's to engage local professionals, folks that know the answers to the questions that you're posing there. That's how we do it, and that's how we do it in short order. It's just finding the folks that have the knowledge and engaging them, bringing them on our team, even if it's only temporarily, to help us navigate all those various complexities. We tend to buy, if we buy something in one market where we don't own anything, we have a plan to expand that footprint so it's kind of like you got to learn at one time but once we once we buy that first community we're successful with it we typically work really hard to expand that footprint in that local marketplace because we've already got the local knowledge we've got the resources we've got the the folks that we can lean on that have the the the local localized knowledge and all those things that help alleviate risk associated with any new investment
SPEAKER_04:Can I ask about the case study in front of us now? This is a high end lakefront community in Ohio. And it looks like really well when they say high end. I mean, these are beautiful lots with and everybody has a view of the lake. And I have to say that's kind of unusual. Is this a seasonal community or is this year round?
SPEAKER_01:It's for technical purposes. It's year round. However, there's only about 20% of the residents live there year round. And so this is a unique community. Every one of those home lots has waterfront dockage. And so in the summertime, they all have both. This is a really popular recreational lake. It's about 45 minutes outside of Columbus, Ohio. So major, major market. And so a lot of the residents that live here, these are their summertime cottages. Folks that live in Columbus and the Columbus MSA, these are their summertime cottage. They come here and spend entire summer or spend weekends. They play pickleball. We just didn't sell it. If you go back there, there's a pickleball court we just put in there. The demographic here is it's a little older. Folks might have kids, but it's a higher-end demographic. It's folks that can afford to have a second home, a second vacation home. These average units, even though some of these homes are older, the inside of these, if you went to Zillow right now, and there's about three or four that trade every year. If you looked at the interiors, you'd find that folks, they invest$50,000,$60,000,$70,000 on complete revamps on these in here. It does not look like the outside. The average home in here sells for about$140,000. Some have sold for as high as$200,000.
SPEAKER_04:What kind of rent do they have to pay for the lot that they're sitting on?
SPEAKER_01:So right now, I think that community is at$900 a month is what they're paying for lot rent.
SPEAKER_04:And so it occurs to me that if I'm... All right, I'm going to ask a very delicate question right now. But in the newspapers, we hear about companies like BlackRock are moving into this kind of business. They're buying up residential real estate all over the country and they're jacking up I think a lot of people are nervous that the emergence of hedge funds into this business is going to be massively disruptive. But I wanted to stop at this point in the video because you can see that there's other land available. There's a lot of farmland even available in this community. And so the reason, I guess, that a BlackRock can't do that is that if the community revolts, then they'll change the zoning.
SPEAKER_01:Yeah, not too much. One of the biggest– I mean, there's a couple questions you have there. One of the biggest barriers to entry with this investment, and one could argue that it's in favor of owning these, is that it's very restrictive as far as municipalities allowing new mobile home parks to be built. In fact, over the last decade, there's been like five new communities that have actually come out of the ground, brand-new communities. In fact, there's been way more that have shut down or been redeveloped. That's why BlackRock does it
SPEAKER_04:because
SPEAKER_01:once they're in– But to your point– They're in. Yeah, well, to your point, would someone move their home? And look, look, every market's got a ceiling of what someone's willing to pay before they decide to move on somewhere else. it'd be tough to say that. Could we move it to$18 a month? And would people stay there living there? Possibly, probably not. Cause really what we try to be competitive against is what is the, the cost of a, this is the only mobile home park on this Lake. It's the only one, everything else is a single family home. And so what is the, you know, if someone, you know, the comparable, what, what's it going to cost somebody to go buy a waterfront single family home? That's a similar square footage, a small cottage, 1200, 1400 square feet. What's that going to cost them all in. And right now, on that lake, that's going to cost you about$800,000 or$900,000 on the low end. And there's plenty that are north of a million dollars. And so we want to be incredibly competitive. We want to have a really compelling storyline of why you should never leave here because this is the cheapest option. This is the, while 900 might seem like a lot. And while if we're going to carry with inflation, I mean, inflation's still rolling right now. And so we, our insurance costs go up, our taxes go up. And so we typically have rent increases on annual basis, but you know, we don't go in and raise rents, you know, hundreds of dollars or 50%. But as your investor
SPEAKER_04:talking, I believe that this feels pretty safe. What you've just described to me, because you're charging 900 and I feel like even though you're You're telling me you can't charge$1,800. I feel like there's a big gap between that$150,000,$200,000 mobile home and that$800,000 floor on the single-family home. My investment is pretty safe
SPEAKER_01:with
SPEAKER_04:you. I
SPEAKER_01:would say so. and a lot of folks that live in our community that are paying, they wouldn't be able to afford that$800,000 home, right? Like it's just, they enjoy the same things. They absolutely love being on the water. They love the lifestyle, but maybe they're, maybe they make a collective, you know, household income of$400,000 a year. Whereas the guy that's got the, you know, the million dollar house is just sitting there, you know, nine months out of the year, he's probably making six, seven,$800,000 a year, right? Cause he's got a great house in Columbus and he's just got this other million dollar house that's sitting here with majority of the year that stays vacant. So again, I, I get the point, and again, I'm not arguing that we couldn't raise it or double it. That's not our business model, but I think there's a ceiling. At some point, something that we argue is attainable housing or affordable housing. This is a little unique. This is probably an anomaly community when you compare it to everything else we own, because pretty much everything else we own, it really is... the most affordable option in the immediate marketplace, but it's typically their primary residence. Whereas this one, these are secondary residences. It is affordable housing in this unique recreational area, but it's secondary housing. So again, kind of an anomaly there, but there's a ceiling that everyone has. Everyone's got a ceiling. You hit it. Guess what? You're going to lose occupancy. You're going to lose people. It's no longer a compelling enough reason why they should be living there and they're going to move on. And I don't know what it is there, but
SPEAKER_03:So Kevin, let me ask you something. So is your business, like, is this a competitive field? And also, I mean, a secondary question to that is, let's just say one of these, you wanted to sell one of these. What is the, do you gonna sell this to a local person most likely? Are you gonna be dealing more on a nationwide scale? And will, you know, if you put, it's all price, but if it's a, the price is fair, Would you expect to have many interested people or would it take time to identify the right person?
SPEAKER_01:It's an incredibly competitive landscape today. If you asked me that question 10 years ago, 12 years ago, I would have had a slightly different answer. I'd have said it's competitive, but there's a lot of opportunity out there. It's a night and day difference today. It's an industry that was incredibly fragmented a decade ago, but it's really consolidated now because a lot of institutional capital, BlackRock you'd mentioned, there's a number of others as well that have come into the space. And the problem is that you've got these big groups. They don't like writing checks for a million or 10 million. They need to be able to deploy hundreds of millions of dollars in one fell swoop to have it make sense for them. And So you've got this higher demand that's continually coming in day after day, year after year, but no new supply. Are they moving
SPEAKER_04:down market because they can't buy billion-dollar investments, so they go to$500 million to$100 million? Are they now going down market and making$50 million bets because that's all that's left?
SPEAKER_01:Yeah, I mean, that's kind of the trend that's been happening. And so even in our space, there's not many– single mobile home communities that would trade for$50 million. Whereas an apartment community, there's plenty that would trade for$50 million. And it's just not all that commonplace. But they're buying portfolios. But yes, to answer your question, whereas maybe when they got into this space, I remember having conversations with the rep from Carlisle Group six, seven years ago at a conference. And they were coming in all hot and heavy, thinking that they were going to be able to deploy a billion dollars into the industry. And that quickly changed over the last six, seven years. We sold a community to, it wasn't I'm not going to name the name, but we sold a community for about$17 million to one of these big institutional groups. And that was one transaction,$17 million, which prior to that, they would have just brushed off. That's too small. We need more than that. So I think they've realized if they want to get into the space and they want to have it as part of their holdings, these transactional sizes are typically smaller unless they can accumulate a large portfolio. But again, even in our industry, it big portfolios that transact for hundreds of millions of dollars just aren't all that common. I think the largest transaction to date of a portfolio within our niche was roughly$400 million. And I might be wrong on that, but like what I recall in the last couple of years,$400 million was the largest single portfolio transaction within the MHC space.
SPEAKER_03:And that would have been about how many parks?
SPEAKER_01:Yeah, gosh, I don't, I don't remember. I think it was, I think there was, you know, eight, 70 or 80 of them in there. give or take, and all various sizes as well. So
SPEAKER_03:you're in Tampa. You have this place in Fort Wayne. How many people do you employ in Fort Wayne?
SPEAKER_01:Yeah, so, you know, our company's kind of bifurcated down the middle. We've got an investment arm, which basically is our capital raising, our acquisitions, you know, dealing with our investor base. And we've got, I think there's about 15 or 16 folks on that side of the organization. However, we're vertically integrated with our property management. And so we employ everybody, both on the ground level at each one of the communities, as well as on a, you know, hierarchy of our regional vice presidents, director of operations, support roles. roles and all that. And so each one of our communities, at minimum, has one community manager, like the smaller ones. This one we're looking at here, this is the smaller. It's about 100 spaces. There's one community manager because it's pretty small. That's all we really need. But then that larger community in Fort Wayne, 738 sites, there's a community manager, assistant community manager, two sales and leasing agents, and two groundskeepers. And so between all the communities that we have, and then I guess the external staff in the property management side, I think there's about 70 employees on that side of the business.
SPEAKER_04:There's no amenities on this one. What's the kind of what's the kind of rent and what's the kind of purchase price in it in a small community like this in Ohio?
SPEAKER_01:Yeah. So this is an interesting one. Again, this was a recent acquisition. This has happened to be it's kind of we call it a bolt on. This is about 10 minutes away from that very large one we looked at. This is. probably about our threshold of like the size, meaning like it's, it's, it's, if we didn't own the other community in Fort Wayne, we wouldn't have bought this. Uh, and then on top of that, this was a little rougher than we typically like to deal with today. Um, it just needed a lot of cleanup, a lot of improvements, uh, but we got it at a right price. And again, we, we have a quite a big, um, quite, quite, quite a lot of manpower at our other community, 10 minutes away. And so we justified the purchase of it, but, um, Your original question. I'm sorry, John. The original question was? Rents and returns. Yeah. So in this community here, I think when we bought it, the lot rents were at 280 a month. We bought from a guy that had owned it, I think, for about 16 years. So he just got pretty lazy over time. He was an out-of-state owner. Didn't really have his finger on the pulse. 280 when we bought it. I think the lot rents, we've only owned it for a short period of time. I think we just did our first lot increase. I think that the lot rents are now 340 a month. So still very affordable. The market here, year, meaning that what we target as over the next five years where we'd like to be is probably somewhere in the$500 a month range. So still, again, incredibly affordable To
SPEAKER_03:get there, to get to that, do you have to commit to sprucing this up quite a bit?
SPEAKER_01:Yeah, yeah. So we had a pretty big capital budget on this one. It doesn't show in this video. This video was taken before we closed on it. We get drone footage and all that before we close. But we're redoing the roads, put a new playground in. We got rid of a number of homes that were old and kind of just junkers and abandoned. I believe we are doing quite a bit of tree work here. A lot of landscaping, new signage all throughout the community. You know, stop signs, street signs, things like that. It doesn't have a clubhouse. It doesn't have anything like that. And so really we focused on the central area right in the middle there. It was a playground. It wasn't much of a playground, but we've got basically like$100,000 worth of playground equipment we'll put in there. Pretty elaborate playground because 80% of these homes in here have kids that live here. And so they need some type of park-like setting that they can spend time at. You know, gazebo, picnic table so they can do cookouts. We'll have some grill And you will, you will hold this. Yeah. So I mean, you know, we like to everything we look at, we like to think as though we're going to hold it for ten plus years if we were ever to sell this. We would sell it in combination with that larger community that we own in Fort Wayne. We wouldn't sell it by itself because we're not going to yield a, you know, we'd get a higher yield and a lower compressed cap rate if we sold those two together to a larger institutional type group than that if we sold this individual one by itself. That still might be a decent sized group that buys it, but it's not going to be as competitive and as aggressive as a buyer as if we paired it with that larger community that we have.
UNKNOWN:Yeah.
SPEAKER_04:I don't want to end the hour without asking. if I invest, how do I invest? How much, how little can I invest and try this out? And what kind of cap rates, what kind of return and what kind of range? I mean, I think that the waterfront community is awful sexy. And I think I want to get in on the waterfront mobile home park. But if you tell me that this one here in Fort Wayne, Indiana is, is going to give me a 15 cap, then I'm like, you know, sign me up today. Yeah, that's
SPEAKER_01:funny. So, so unfortunately that waterfront community, John, It's in our third fund, which is currently closed out for new investment. So unfortunately, you can buy a home in there. Go to Zillow. There's probably one for sale now, so you can get your little pontoon boat. No, I want to be on your
SPEAKER_04:side of the desk,
SPEAKER_01:collecting the rents, not paying the rents. And I know once you move in, I know that you're comfortable paying$1,800 a month, so we'll do that. He's a broker, too.
UNKNOWN:Yeah.
SPEAKER_01:Yeah, so we do a fund structure. So we don't buy one-off investments and look at them as a standalone investment. So we typically roll out a fund. Right now, we have SEI Growth and Income Fund 4. And it's a combination of not just mobile home parks, which is what we talked about today, but also we own parking garages and parking lots. And so SEI Growth and Income 4 will be open for the remainder of this year. And then we'll basically be rolling out fund number five at the beginning of 2026. I think at present time, we've got about We're on the page now. Yeah. So if, If you click that, it will give you a form to fill out, but then it will give you access to a recent webinar we've done. You can schedule time to talk with one of our investor relations associates. What's the
SPEAKER_03:minimum investment? How
SPEAKER_04:do they compare to other funds? Is this
SPEAKER_01:good? I think it's great.$100,000 is the minimum investment. Target annualized return, 16%. And again, we run this out over a five-year span. However, we always tell our investors, we like to make sure that we align ourselves with the right investors. Anything we buy, number one, they're not making more mobile home parks. They're not really making more parking. And so when we find a great asset, while we might underwrite something over a five-year span, we also look at it over the 10-year horizon, maybe even longer than that. And so we want to make sure that whatever investors get involved with us, that they've got a longer you know, that they're more of a, you know, kind of set it and forget it, you know, just receive the mailbox money on a regular basis rather than that individual that might be just getting started, might be an accredited investor, but really needs to, put an emphasis on recycling their capital. Like I'm going to put a hundred grand in, but I expect to get it back in the next two years, three years, so I can turn around and put it into something else. So we're kind of, a lot of the investors we work with are in the wealth preservation stage. Like they've made it in another business and a profession, and they just want to put in a good solid investments that give a solid return, that pay out distributions on a quarterly basis, and that they don't have to think about a tax event every couple of years when I tell them that we're selling, you know, a whole slew of assets.
SPEAKER_04:What does that mean? 16% and 8%. Yeah. So
SPEAKER_01:that's, that's paid 16% based on the IRR, um, you know, internal rate of return. So the, the, uh, the, the splits there that as it references. So basically, um, all of our investors get all their, they get every distribution until they get their original capital back. And then after they get their original capital back, um, we make up any preferred return. That's a, that's a crude. And so once they've been made whole entirely at that point in time, um, myself, my partner, we get to participate in what's called the promote. So we end up getting 30% of the distributions. Investors get 70%. If there's any capital events, you know, cash out refinances or sales. The proceeds are split 30, 70, 30 to us, 70 to them. And that's for the life, life of the deal thereafter.
SPEAKER_04:So if I invest my hundred thousand dollars in fund for fund for the closes at some point and I get my distributions each year or each quarter until what, five years, 10 years after which I could get my capital back and you close the fund?
SPEAKER_01:Yeah. So typically how it works is we'll, we'll close out the fund at the end of this year for new investment. So we won't take any more investment dollars into it, but that doesn't mean that we're selling the assets. Um, that means that we're just going to open a new fund so we can, the SEC has some guidelines around how long, you know, an open ended fund can be, can actually accept new capital. So we basically are working, you know, our normal funds over two years, but we might own those assets for seven, eight, nine, 10 plus years. And so what would ultimately happen is, um, typically what we project is somewhere year four to five, we'll have all your original capital back to you. That will be a combination of distributions. That will be a combination of cash out refinances. Once we have all your original capital back to you, we'll split the proceeds of the cash flows, 30 to us, 70 to you. If we sell it year 10, whether it be one property or all the properties in that fund, those proceeds of that sale event will be basically split up again, 30 to us, 70 to each one of the investors. If it's a single property inside that fund, it's proportionate to that individual property. If it's the entirety of the fund, again, same thing, 30%, 70%. Can
SPEAKER_03:we, we haven't talked about parking lots and I'm just curious, parking lots, parking garages, things like that. Is there, because of all the EVs that are coming, are you experiencing a tremendous like capital expense to kind of retrofit a handful, you know, at least a certain portion of it? Or I mean, how are you attacking that eventual demand?
SPEAKER_01:Yeah, no, it's a great question. It's a case-by-case basis. And I will say that there's quite a number of companies out there now that are really targeting parking owners, electric, EV charger providers, whatever you want to classify them as, service providers, basically the equipment guys. And so there's a number of groups out there that ultimately will even go as far as paying for all the necessary infrastructure and the modifications that are needed to a, whether it be a parking lot or a parking garage. So that the actual owner doesn't have to come out of pocket. maybe taking it on the front end a little bit, you know, and, you know, kind of a loss lead on the front end to pay for the infrastructure so that they see the long-term benefit in the long run and, you know, probably find an exit, you know, five, 10 years down the road. So it has not been something that we've had a budget for, which is kind of a beautiful thing.
SPEAKER_03:So one question, one more question. You have a lot of questions, but you're all over the place. You're in Atlanta, you're in Indiana, you're in Phoenix. Like where are these opportunities? But he's
SPEAKER_04:not in Florida. He's not in Florida.
SPEAKER_03:He's in Florida. I'm just joking. No, but how are you fielding these opportunities? Are they coming to you? Are you seeking them out?
SPEAKER_01:All the above. I would say up until three years ago, 90% of what we bought were based on our own efforts, basically cold calling owners, building relationships with them, building rapport over long periods of time, and hopefully continuing us coming to mind when they made the decision to sell. I'd say in the last three years, that's changed a little bit. A lot of these larger properties that we've been buying larger scale properties. Most of the owners typically don't want to sell directly to another buyer. They want to leverage a broker, the expertise of a broker to play the middleman and just facilitate the transaction. So I'd say over the last three years, it's kind of gone 50, 50, where 50% of what we buy is through a broker relationship. And the other 50 is still kind of long-term relationships that we've had for many, many years with owners.
SPEAKER_04:Wow. Roberto, you want to do another hour right now or we're going to bring him back another time?
SPEAKER_03:The landscape is wide open. I mean, I'm just just lots. I guess there's lots of opportunity yet competitive. And yet, you know, you've got to know what you're doing. It's a niche.
SPEAKER_04:I mean, yeah, just scratch the surface today. All we've gotten is, you know, I looked around and I got into house flipping and. that's how, you know, it didn't work out. But when
SPEAKER_01:I came back, it worked out, it just didn't work out, you know, for, for, for a very long, it worked out for seven or eight years, but then it didn't work out. Hit the reset button
SPEAKER_04:with, with, it didn't work out with your ambition where you're like, I'm not doing one house at a time. I'm going to do 30 and 50 at a time. No, I'm going to do, I'm going to do, you know, funds and I'm going to fund massive portfolios. And, uh, So we haven't even gotten into how you pick your properties and we haven't really gotten into it. We've just scratched the surface on the economics of this. And that's the fun stuff. We should do another one of these specifically on parking lots. Yeah, I would love that. Just do parking lots for a whole hour because I'm fascinated with parking lots. I have a parking lot in my building and I know that every spot is so precious in the lease and everybody wants to know, am I getting one spot or two spots? Don't you take my parking from me? And so being on the other end of that, where you're a disinterested, dispassionate investor of parking spaces, it's a very emotional thing for me. That's what I'm trying to say.
SPEAKER_01:Maybe not for you. It's an interesting niche. I mean, it's one that from the outside looking in, it seems pretty basic in nature. But it has way more complexities of who the parkers are, when they're coming, when they're going, the dynamic pricing model, being competitive with other parking options in the local immediate marketplace. So there's a lot more moving parts to parking than what meets the eye. And so it is a fun industry. We studied it for three years. I interviewed a guy on my podcast many years back, and I was so intrigued. He owned some parking lots, just like you. I spent an hour with them and then I flew them to Tampa. I'm like, man, I gotta, I gotta learn more. I have so many more questions. And then we studied it for the next couple of years, went to conferences, met other people in the, in the business. And if I pulled the trigger back in 2020 about our first parking asset and, uh, and it's been a, it's been a fun ride, but it definitely is. It's, it's interesting because everyone's a little different. You know, demand drivers are different. Like who you serving, you're serving cars, but where are they going?
SPEAKER_04:Once you pay$100 to park your car for the first time in Manhattan, it's possible, right, Roberto?$100? I
SPEAKER_03:paid like$750, and people were like,$750, not bad.
SPEAKER_04:That's a month, right?
SPEAKER_03:That's a monthly.
SPEAKER_04:But if I go into dinner and it costs me$60 to park... When I go see a Broadway show. Two hours. And then I go park in one of your parking lots. And it's like, oh, I don't know. I mean, average parking in America, it's two, three, four dollars. I think to myself, man, you guys aren't charging enough.
SPEAKER_01:Well, here's the thing. We own a parking garage. I like to say that parking, if you buy in the right location, it's got inelastic demand and that, you know, we've got a parking garage here in Clearwater beach and, uh, there's a moratorium. You can't build more. We actually bought from the city. They built it and they did a horrific job running it. Uh, and so we bought it from them. And, um, basically I like to, I like to make the joke of like, if you're driving with your family of, of, of, of four, you got your kids in the back. You've already spent some time in traffic, getting down to the beach or driving around. It's chaos. You're trying to find parking, your kids screaming, right? They got to go to the bathroom. You got to pee and drive around.
SPEAKER_04:It's worth whatever you're
SPEAKER_01:charging. If it's$20,$40,$60, you're going to pay whatever that number is. We don't take that approach per se, but you will pay whatever is on that sign if there's available parking there so that you can stop the screaming, stop the yelling, get the hell out of the car because you've been in it too long now and your kid's got to go to the bathroom. He's going to pee himself. You talk like it's an exception.
SPEAKER_04:I pay$100 every time I go to Yankee Stadium. Every time. So... And I don't need
SPEAKER_03:it. This was awesome. This was awesome.
SPEAKER_04:This has been awesome. Thank
SPEAKER_01:you so much, Kevin. And we're really happy to do another show. We can do one on parking. I think that we could probably fill, you know, an hour just on parking.
SPEAKER_03:So what is your podcast by the way?
SPEAKER_01:It's called real estate investing for cashflow. I'm one of the old guys in the business. I've been doing almost 12 years now, which is interesting. Back before people knew what podcasts were, I used to have to tell people, where am I going to hear this? It's an internet radio show. That's what it is.
SPEAKER_04:And what day of the week?
SPEAKER_01:When? We release on Mondays. Okay. I'll look for
SPEAKER_04:it. That's awesome. Thank you, Kevin. It's been a pleasure. Thank you. We'll get you back for parking. Bye.
SPEAKER_03:Cheers, guys.
