- 00:15- The appeal of mobile home parks as a stable investment in affordable housing.
- 05:30- Strategies for conducting thorough due diligence and navigating zoning regulations.
- 12:45- Challenges such as tenant management and regulatory compliance.
- 20:10- Tips for optimizing operational efficiency and enhancing property value.
- Website: https://themhpexchange.com/
- Website: https://www.stonecapinv.com/
- LinkedIn: https://www.linkedin.com/in/frank-rizzo-20818843/
- Contact Number: 843-619-3005
- Instagram: https://www.instagram.com/exitstrategiesradioshow/
- FB Page: https://www.facebook.com/exitstrategiessc/
- Youtube: https://www.youtube.com/channel/UCxoSuynJd5c4qQ_eDXLJaZA
- Website: https://www.exitstrategiesradioshow.com
- Linkedin: https://www.linkedin.com/in/cmelette/
CORWYN:
Do you want something more? More meaningful moments, opportunities, deeper relationships, and memorable experiences? Do you want to make a difference? If you said yes to any of that, a career in real estate could be the opportunity you’re looking for. Guiding people through one of the most important decisions they ever made. The purchase or sale of their home can be both rewarding and lucrative. Exit Realty’s revolutionary compensation model, training, and technology provides you with the tools you need to start and build your successful real estate career. Call Exit Realty Lowcountry Group today at 843-619-3005, that’s 843-619-3005 or visit join.exitlowcountry.com and make your exit today.
Good morning, and great morning to you guys. Our exit strategies and radio show family. Hey, I’m your host Corwyn J Melette, Broker and owner of Exit Lowcountry Group in beautiful North Charleston, South Carolina. So if this is your first time listening to this show, Hey, you, sir, ma’am, are in for a treat, because I mentioned here is very simple. That is to empower our community to financial literacy, and real estate education. As we always say, as we always do, as we trust that you will always find we are legacy building that is what we do. We legacy bill. So I want to give a quick shout out to our listeners, you loyal folks that listen to us not only locally in the Charleston market, corner, buy mama live out there, all the way downtown out to the islands, guys. Thank you guys so much for tuning in. For those of you listen to us around the world, from various states, but also various countries around and continents around the globe. Thank you guys so much for tuning in. It is always humbling to me to understand and get feedback on how many people we reach, and how many far places so it’s always extremely humbling. And I thank you guys for listening, and most importantly, sharing our content. Guys, today, we have a great show for you. So this is my disclaimer, this is going to be a nugget filled episode. This is my ask of you. All right, my prerequisite if you will, I want you to go grab pen and paper. Because look here, our guest today is going to give it to you. And I need you to take notes. Because you’re gonna have a lot of questions. And I want you to make sure you get them down. I want you to make the notes in the points so that you can reach back out to this guy. We’ve had guests on, we’ve talked about a tremendous amount of strategies and a lot of spaces. But today, we are going mobile. Now lucky. I’m gonna tell you a little bit about our guest today I got today is none other than Frank Rizzo. He is the founder of the Mobile Home MHP Exchange, and also the co founder of Stone Capital has over 20 years of experience in the real estate realm. And listen right here, when I got the bio, and we connect, and I’m like, okay, guy, you’ve been doing this thing. So for the last 12 years, he’s focused on mobile home parks, he has moved over and I’m like, that’s impressive. He doesn’t move a bunch of dirt. He’s moved over 1500 Almost 1600 lots so far. That is such an amazing feat. I’m extremely humble. And I’m getting my own pen and paper because I need to get some notes for him today. So guys, please welcome to the show. Frank Rizzo. How are you doing today, Frank?
FRANK:
Corwyn, I’m doing excellent today. Thank you so much for having me on. I’m looking forward to sit down and talking with you and appreciate everything that you’re doing in terms of empowering people who are listening to your program. I’m happy to be part of this program today.
CORWYN:
Well, thank you so much for taking time out your busy schedule. So look, Frank, how level I gave him my synopsis. I gave my introduction, but I want you to tell people, you who you are, what it is that you do, and what got you into this space.
FRANK:
Great question. So my name is Frank Rizzo. I’ve been in the real estate industry for over 20 years as owner, investor, real estate broker. But at the end of the day core and the most important thing as you get into real estate, for your real estate agents that are listening to this or someone who has a passive interest in real estate, it’s ownership is that path to financial freedom. And I got myself into real estate because I always wanted to be involved in quote, unquote, real estate investing and deals. And after spending some time, in the early part of my career, flipping homes and doing all that I realized I wasn’t really investing. I was speculating, right. I was hoping that I would buy right and I would sell higher when I got introduced. To the manufactured housing space, it just clicked with me in a number of different levels. I mean, it’s community building 101, right, you come in there you own the dirt, you’re operating inside that community, you’re impacting the lives of the people who are in there if you’re providing a very important need in affordable housing, and today’s market and as prices across the board have gotten so accelerated, there is such a need in the affordable housing space. And over the last nine years, my partner and I were based in New York, we’ve transitioned out of investing in New York. And our focus obviously has been on growing our portfolio in the manufactured housing space where we’ve owned and operated over 22 communities in your neck of the woods. I mean, we’re everywhere from Alabama, Georgia, we haven’t been able to get into Charleston yet. I’m hoping after this program, you’ll be able to send me a couple of good opportunities. And in North Carolina, so we’re in that Sunbelt region. And we own and operate all of our communities, ourselves. And that’s got me to where we are today.
CORWYN:
Awesome, awesome. That is a heck of a journey. So let’s talk about, you know, Frank, the difference in the offering, if you will, and I want to say product, but the difference in the offering because we talk on this show about various opportunities or paths to real estate investing in growth and building wealth. So why mobile home parks? Like why is that thing?
FRANK:
That’s a great question. And for someone who started out in Brooklyn, New York, where there is zero mobile home parks, if you would have told me 15 years ago that now this is my passion and I’m an MHP enthusiast, I probably wouldn’t have believed you. But the key component on it is, and there’s a few key components on it. One, what I found, when you owned and operated a community that typically the residents of those communities would stay on average 17 and a half years, you had a very sticky resident bass, because while it might be a mobile home park, the homes themselves are not very mobile, to move one of those homes, there’s a cost to it, and somewhere between 12 to $16,000, to move one of those homes. So for your resident, if you have a very well run community, that’s safe, that’s clean, and that has the amenities they’re looking for. They don’t want to leave because it’s just too costly. They’re not going to leave to go into another community, they’re only going to leave if it’s unsafe or unclean. So I liked that and the predictability of that income stream. And two, I was always involved in the community development aspect of it. And when you saw that each one of these communities core one is its own ecosystem. And if it’s well run, not only can you make money, which is what you’re trying to do for your family and yourself, but you can also have a real positive impact on the people whose lives that are inside the residence inside your community. So for me in a couple of different factors. And as we dove deeper into it, we realized that we had a real competitive advantage to doing it. It’s a very fractured mom and pop industry still, to this day, dominated by Mom and Pop individual owners, and just now you’re starting to see more of the institutional money, find its way into that space. So for an investor who’s looking for a pathway to create financial freedom for themselves, you’re not competing. Sometimes with the largest enterprises, if you look for retail strip malls or commercial space or multifamily, you’re probably competing with a lot of private equity firms with deeper pockets than you. And here, there is an opportunity for us to get involved, and to modernize some of these assets.
CORWYN:
One of the things that I’ve seen over my years, Frank. 20 years, this makes 20 years in real estate industry for myself as well, I’ll tell people, I’m too stupid to leave it. Just love what we can do, how we can impact and change and shape our communities. But one of the things that I’ve always seen with mobile home parks, is that they tend to be– there’s a term, I haven’t said this in a long time. But it’s a term that comes around about manufacture houses, they’re like money box, they literally can be very lucrative because they’re usually fairly inexpensive to work on. Even though they may damage fairly easily, usually fairly easy to work on. And if you maintain them then they’re an asset that will last for 30, 40, 50, 60 or more years if you maintain them, which means they keep paying for themselves over and over again. And again. A lot of people start this as a mom and pop they start with one or two trailers on a piece of property and kind of grow and expand. But what methodology do you use to identify a good offering? Are you looking at potential growth? Are you looking primarily at what is existing? What methodology are you applying towards that?
FRANK:
So that we tend to take on a lot of the projects that maybe other operators won’t take on, we like to roll up our sleeves, we get a little dirty, we tend to find assets, like you said, maybe granddaddy built it, mom and dad ran it. And by the time it gets down to the third generation, they’ve either moved off or moved out of that community where there wasn’t a real good exit plan for the asset. So we’ll come in, we’ll buy that usually, our typical community has suffered from a few years of underinvestment or disinvestment, you’ve got maybe roads that need to be repaired, or homes that just are, it’s just a lot of deferred capital of improvements. So we’re able to come in to project like that, we’re able to deploy that capital to create a new standard inside that community, whether that’s cleaning out some older homes, that former owner wasn’t able to get rid of weather that’s cleaning out some brush and debris, paving the roads, and creating modernizing the exterior of the homes, even the homes that we don’t own, because we realized, like you said those homes can last a very long time if they’re well maintained. And a lot of times in the markets we operate in, maybe the skirting isn’t there, and maybe the roof needs to be cool sealed. Maybe the exterior siding needs to be painted or new siding put on and we can offer that to our residents. And then you create a community that has a new look and feel. And additionally that allows us the ability to infill and bring in new homes, to attract new people to those homes, and offer really affordable housing. At a time where affordable housing this nation has an affordability crisis, quite frankly, and what people have overlooked and they’re starting to revisit. Now you cannot build a stick built home, for the price that you have a manufactured home, it’s just more cost effective. So we can deliver a brand new three bedroom, two bath home at a price point that cannot be delivered to somebody who’s buying a traditional stick built home. So in our communities, we could sell a home between 55 and $60,000 for their own home, and you’d be hard pressed to find a new home anywhere in this country at that price point.
CORWYN:
Makes very good sense. And one of the things as an investor because he’s so your group, also on the capital side. So when Stone Capital aside, you guys also pulled investors together. Am I correct about that?
FRANK
Correct. We started a first community was with friends and family. Seven people was like pulling teeth to get investors from Staten Island, New York to invest in Jacksonville, Alabama, especially when at that point, the market here was going very strong, like it’s starting to come back out of everything. Why are we going 800 miles away. But realizing a couple years down the road, how fortuitous it was as as New York closed down, and all of a sudden the legislation got very tough year. And it’s very tough being a landlord in New York City, we were able to grow from that. And our platform grew just from word of mouth. And we were able to get more people to our platform. And we’ve just recently launched our first fund in the manufactured housing space just to be able to continue to do what we do, which is bringing affordable housing options to the Sunbelt.
CORWYN:
One thing. So for our listeners, you guys have been with us for a while. You may have heard this previously. But manufactured housing is the original affordable housing. This is referred to as HUD housing or HUD units, because this is what HUD would fund these as far as the placement of the manufactured home on the property. Again, this is technically the original affordable housing. For those who follow the history. There’s a whole lot of other caveats in there that people may or may not know of. But Frank, you hit it che king the boxes, man that this allows people, this type of product offering allows people into home ownership at a much lower entry level, much lower barrier to entry, and in turn, helps them to establish themselves overall. Now on the other side, the investment side for an investor you’re looking at, okay, well, I’m made buy the unit, sell the unit, but I’m also keeping lot rent. Am I correct?
FRANK:
Correct. That’s exactly it. But and so here’s what’s happened in the space Corwyn over the last few years. And where I think we have different look at it. Over the last few years. All of a sudden, mobile home parks and mobile home park investing became very popular again and people looked at it from a spreadsheet and they said wow, this is you have captured resident which we talked about on average the state alone longer than any other resident in any other asset class. And so they would purchase the community thinking that they could raise lot rents and people would still stand. And that’s caused some friction, because at the end of the day, you have to add value to people’s experience, right? we’re big believers in our residents experience. And if they see the value, they want to stay, and they want you to be part of that community, the mobile home park resident has an emotional attachment, because to your point, they have their biggest asset on your land. And they have just as much a vested interest in making sure that community is well run. So we’d like our residents to own their homes, because they’re vested in there alongside us. And we know that they’re going to be there for the long term. But you can’t just take that locker and say, Hey, we’re not, we’re not doing anything for it, we want to make sure that you’ve got we’re offering the best value in town, whether that’s ensuring the cleanliness of the park, the safety of the park, the we’re adding amenities, and adding value for you and your home and giving you the type of place where you’re gonna love to live, and you’re gonna be our best sounding board, you’re gonna be the one that’s gonna say, hey, if there’s an empty spot, or there’s a home available, let me tell my cousin, let me tell my coworker, and let me help you fill in that park. Because we love what you did.
CORWYN:
That is it spot on. Because that word of mouth, the other residents sharing what you guys are doing in a park, hey, they’ve come through, they cleaned up new management, what have you makes it attractive for someone else to either bring their home in or possibly purchase a home through you, and the investment continues to grow?
FRANK:
Correct. And listen, you’ve been doing this for 20 years. And you look at the other asset classes, and we’ve owned apartment buildings and commercial buildings, you don’t usually get referrals from other residents or in the in there that are looking to get other people to fill up your space. Right? If you do, it’s very few and far between. And in this space, in a well run community, it happens more times than not because people who are there and they’re happy about how that community is run, they want other people who they know, to live with them as well. So that to us, that’s a sign of us doing our job correctly, that our residents willing to refer the people that they know, love and care about into one of the communities that they live in.
CORWYN:
So let’s talk about the website, let’s talk about the platform that you guys have built in order to share information in the space, resources and the light. But on top of that, you guys also have a platform where you guys have product offerings or offerings for parks around the country. Let’s talk about that. So what was the driving factor for you guys in establishing that?
FRANK:
So it’s funny, we, my partner, and I, like I said, we built all this word of mouth. And we started talking about what wasn’t there when we started. And when we started, and we saw a lot of people who have expressed interest in the space and the information was very fractured. So what we looked at was, if we could have a platform where we could talk about the news of the day from across the country. So this way, if you’re in there, you want to find out development that’s happening in the manufactured housing space, or legislation in the manufactured housing space. There was one repository one spot that that you could go there and experience that. And then we said, Well, what else do you need other than news, Corwyn people looking at the space want to find opportunities, whether it’s new listings that are coming up there from across the country, so we added listings, and then that education component, so people could come in there, and they could learn the things on, you know, what they should look for when they own a park, how to source a deal, how to best operate a community, or maybe best things to dress something up for sale, different little tips and tools for them. And of course, we have a podcast called The MHP Exchange, we put that on there. And we’ve launched a video log called trailer park turnaround watching our experiences down on the ground. So now in one stop, people can get a little bit of all of that information, and just fortuitous. We launched the first personal AI assistant specifically taught on the manufactured housing space called Chat MHP. So you could have your own personal AI agent, doing all that research for you while you’re on that site called Chat MHP. And we’re really proud of that. We just launched that this week. And with the industry’s first personalized AI agent. So we think that’s something that you’re going to start to see happen more and more, but we’re obviously the first people to have something like that in the MHP space. So chat MHP is something that we’ve taught it on everything, just specifically any information on the manufacturing space and how to work with you alongside you in your investing journey.
CORWYN:
That is impressive. Man, that’s awesome. So that’s man that’s cutting edge.
FRANK:
Again, it goes into sometimes the to not how. And I happen to have had a gentleman who I’m very close with and speaking about what we were doing and his friend was essentially an AI futurist guy has been involved in AI for the past 10 years, when we started talking about what we were doing, and how we could work together, he just completely above my paygrade came in wanting to be part of the project. And he helped us develop out something as we rolled it out last week, we’re starting to get some really good response and feedback on and we believe, eventually, if the AI is here, and peep the way they it’s designed, is that you’re going to have a personal agent who’s going to be working alongside of you. And this is something that if someone’s interested in learning about the space, you can ask it the question specifically, and it cycles through all that information that you might get lost on in Google and gives you the answers that you’re looking for. And that’s the power of Chat MHP. And that’s what we wanted to be able to bring to the user experience to the site and to that platform at the MHP exchange. So we created it with the user in mind with the idea of becoming the most indispensable tool to anybody who’s interested in the MHP. Space.
CORWYN:
Wow, that’s impressive. What is the goal? Frank? Like? Where do you see the platform going? How do you want it to serve people? What does that look like?
FRANK:
That’s a great question. We believe very strongly, that real estate is the greatest way to transfer wealth or to create wealth in this country. And I could talk to you and my partner and I, we both come from blue collar backgrounds, no color. And I remember watching my father study for a GED when I was nine years old at the kitchen table. So just to give you a point of reference, and real estate, right, and the ability to gate was the great equalizer, because anybody could come into this business of this industry, with a passion and drive and a willingness to learn. And they can create financial freedom for themselves. And we’ve realized that a lot of people are starting to look into the manufactured housing space, because it addresses a need. It addresses an issue that’s happening in this country. And there’s an opportunity for people to participate, do some really good things with their investment dollars, but also create financial freedom for themselves and their family. So we wanted to create a platform that would assist people on that journey, where they could get educated, they could find out on deals that are coming to the table, he could speak to people inside the industry. When we have our podcast, we bring on industry insiders, so they could learn from people who are involved in the space. And they can have a platform where they could save that information, along with their AI agent and help them decipher that to see what they need to do to go forward. So we wanted to create that experience that will help people on their investing journey. And some people might be more active than others. But we believe that if you’re interested in this space, that you want to check out the MHP exchange, and we want you to create that platform to do that.
CORWYN:
So Frank, this is engaging. And we’ve covered what we want the result to look like kind of that why, if you will, and then but let’s get to the basics. How does somebody get started?
FRANK:
Well, each investor is a little bit different. My suggestion would be to go to the site, if you want to own and operate a park for yourself, then you have to do anything else. If you’re buying a piece of real estate, the first thing you need to do is you need to plan it out. You need to understand what my goal is, what am I intending to do? How much capital am I willing to invest? How much work am I willing to do? And how am I going to operate it from a distance because a lot of times you’re buying, you’re investing in these communities, and you’re not, it’s not around the corner from here, right? That’s the one thing about this space, you have to be willing to go from a distance, then you want to see who you need to have on your team, whether you’re building the team out yourself, or you’re finding a coach and or a mentor that’s going to work with you, and help train you along that way to help you go on your goals. But you have to like we did here, it’s you have to begin with the end in mind. And I found when I’ve talked to him when he years of talking with investors, and you say okay, what’s your plan, and they don’t have it that becomes you have to be able to visually write out that plan. Know what your goal is, what type of investor you want to be, and then be willing to put the people in place to help you get there.
CORWYN:
That’s huge. That’s huge. And that is relevant and very important. So you guys and your platform and Frank, I want to make sure we get your contact information and stuff out here. You guys need a platform or helping people structure the deal. Putting everything in place. You all putting deals together and just taking investors so you can win the entire gambit of either your pay you can be hands off, or you can put your hands on is that correct?
FRANK:
Correct of whether it’s multifamily industry, you just looking at mobile home parks, RV parks that are available for you. And then we give you the tools you need to sit there and make those investing decisions, right? And that’s where we feel we can be of great value. And then of course, if someone has questions, we’re there to answer the questions that they may have on a deal that they might have themselves. So it becomes more inclusive for them to be able to ask those questions and find out those answers that they need to make sure they’re making the right investment decisions for them and their family.
CORWYN:
So Frank, how can our listeners get in contact with, they could find us on themhpexchange.com. In there, you could send us an email, it’s frank@MHPexchange.com. They could see our podcast, they can comment on that. Or if they have comments that they have for me, they could send an email through the site. And we will always look to respond and get back to somebody. Or if they have some other questions about the space. They could ask HP? And that’ll answer the question for them. If they just want to get some information about what the best states to invest in, where the average lot rents are in specific states, they could go to HP and they could find out that information for themselves.
CORWYN:
Awesome. It’s awesome. It’s so frank, look, I want to thank you, man, for taking time out of your busy schedule to be on the show with us. I definitely look forward to getting you back on and having some additional conversations. Because this space is this exciting, it’s dynamic. There’s a tremendous amount of activity, but most importantly, a tremendous amount of opportunity that’s embedded within it. So thank you for exposing our listeners today to it.
FRANK:
Thank you for having me. Cool when I appreciate the time and look forward to talking with you again.
CORWYN::
So for our listeners, guys, look, hell no. Lucky y’all should have a gang of questions. So looking at y’all please reach out to Frank can look junkie on that website. I’ve been checking it out. It is awesome. I love the features, and most importantly, the opportunities that are embedded within so please don’t miss that. I have this thing that I’m going to probably talk about a lot as we go forward our listeners. And I want you to realize this devotional I read recently talked about how we sometimes impoverished God we impoverish ourselves. Because we don’t believe we don’t have faith we fail to act. So this show is about building wealth about creating and building, enhancing, if you will, a legacy that will serve your children, your family for generations yet to call. So don’t impoverish yourself. Apply this information today. Get in contact with Frank again, Frank, thank you for allowing my heart to be a part of exit strategies, radio show family and being with us today.
FRANK:
Thank you.
CORWYN:
For our listeners. One last time, you’ll know how I feel, ya know what I say? You know, I always put the two of those things together. And I say it to you this way, which is I love you. I love I love. We’re gonna see you guys out there in those streets.
PREVIOUS EPISODE FEATURING MOBILE HOMES:
