09/23/2026 - Finding Opportunity in Mobile Home Parks

This CG Commercial Call explores mobile home parks as a commercial real estate investment strategy focused on cash flow, tax benefits, and long-term wealth creation. The discussion covers the investment thesis behind mobile home parks, cost segregation and bonus depreciation, preferred versus common equity structures, value-add opportunities, refinancing strategies, and financing considerations for investors evaluating this asset class.

What This Call Covers

• Why Investors Are Looking at Mobile Home Parks
  • Mobile home parks are presented as a defensive commercial real estate asset class
  • Limited new development creates constrained supply in many markets
  • Residents typically own their homes, making relocation expensive and contributing to tenant retention
  • Affordable housing demand and constrained supply can support long-term pad rent growth
• Cost Segregation & Bonus Depreciation
  • A significant portion of an existing mobile home park's value may be tied to depreciable improvements such as roads, pads, and utilities
  • The call discusses using cost segregation to accelerate depreciation
  • According to the presentation, qualifying properties may generate substantial first-year deductions relative to purchase price
  • This can make MHP investments particularly relevant for investors focused on tax efficiency
• Preferred vs. Common Equity
  • A bifurcated equity structure allows investors to prioritize either cash flow or depreciation
  • Preferred equity receives priority in cash-flow distributions with a smaller allocation of depreciation
  • Common equity receives subordinate cash flow but a larger share of available depreciation
  • The structure can accommodate investors with different income, cash-flow, and tax objectives
• Value-Add Mobile Home Park Strategy
  • The strategy focuses on improving infrastructure rather than extensively renovating individual homes
  • Potential improvements include roads, lighting, utilities, and other park infrastructure
  • Operators can also work toward bringing pad rents closer to market rates
  • Increasing property performance and NOI creates the foundation for a future refinance
• Refinancing & Returning Investor Capital
  • After executing the value-add plan, the strategy calls for refinancing the improved property
  • The presentation describes a goal of returning a significant portion of investors' original capital through the refinance
  • Investors can potentially maintain ownership and future cash flow after recovering capital
  • The preferred strategy discussed is a long-term hold rather than immediately selling the property
• Acquiring Existing Parks vs. New Development
  • Existing mobile home parks may offer advantages over developing new communities
  • New parks can face significant zoning, permitting, and community-resistance challenges
  • Existing properties may also provide more immediate depreciation opportunities
  • Investors evaluating development should account for the additional entitlement and execution risk
• Evaluating Cap Rates, NOI & Financing
  • The call emphasizes the property's value-add potential and ability to grow NOI, rather than looking only at the initial cap rate
  • Acquisition pricing should still support the property's required cash-flow obligations
  • Local and regional banks are discussed as potential financing sources for mobile home park acquisitions
  • Financing strategy should align with the property's improvement and refinance plan