Investor Spotlight

Issue #8:

Featuring Sam B. - Virginia

Wholesaling & Flipping to cash flow

Sam Barr is a man of all trades. He flips, he wholesales, and he buys and holds cash flow. The only reason why he wholesales/flips, is so he can buy more multi-family units, mobile home parks, and self-storage. In this particular deal, we'll talk about his 16 pad mobile home park; which he found off-market like most of his deals. Here's a little info about Sam: He has 5 employees devoted entirely to property management. For acquisition, he's solo. He's been flipping for a number of years now. 90% of his deals he finds off-market using direct mail.

The Deal

The entire package came with:

• 16-pad mobile home park
• 2 empty lots
• 30x40 metal building (for storage/maintaince)
• 1 old single-family house
• 8 Mobile homes (1990's), owned & rented by the park
• Each home worth an average of $20,000
• Gravel roads and utilities paid by the tenants

The seller: Tired landlord Value-add strategy: 

• Converted the 2 extra lots into usable MH pads
• Conducted survey which added 2 extra MH lots. 
• Increased lots from 16 to 20 spaces
• Paved the gravel roads
• Filled empty MH lots with new mobile homes
• New evaluation a year later: $400,000

Cash-out strategy

• Sold the single-family for $32,000.
• Sold two mobile home for total of $35,000
• Refinanced and cashed-out $110,000
• $$ left in the deal: $53,000

The Numbers

• Purchase price: $230,000
• Gross Rents at time of purchase: $3,050
• Gross rents after value add: $4,300
• New stabilized value: $600,000
• Purchase vehicle: cash
• Marketing ROI: 3,800%
• Equity after value-add: $547,000
• 20-year cash flow yield: 97%

The Marketing

• The list: All mobile home parks with 15 pads or more, within 2 hour radius of his residence
• Mailing piece: BPM Template Letter

Get Deals like Sam!