REINNO Mobile Homes Portfolio
Portfolio Financials
| Price | $31,861,500 | AVG Occupancy | 93% |
| NOI | $2,061,682 | Target yearly IRR (levered) | 11.17% |
| Cap rate | 6.47% | CoC Yield* | 7.57% |
| Interests offered | 31,861,500 | *Assumed interest rate and LTV | 6%, 70% |
| Min. investment | $15,000 | Max. investment | $31,861,500 |
| Start date | 20 Aug, 2020 | Deadline | 20 November, 2021 |
| Soft Cap | $2,500,000 | Hard Cap | $31,861,500 |
Mobile Home Properties included in this portfolio offer an above-average cap rate of 6.47% and an incredible opportunity to acquire a positive cash-flowing asset. They are highly diversified, thanks to multiple locations. The investments include lots in Florida, Texas, Montana, California and Nevada.
Many residents renew their leases year after year, resulting in consistently high occupancy rates and stable rent income. Compared to other property types, Mobile Home sites are easy and inexpensive to maintain, making them a perfect investment opportunity.
Portfolio
- Location: Canyon Lake, TX
- Year built: 2020
- Units: 20
- Lot size (acres): 10
- Building size: 13,714 SF
- Occupancy: 95%
- Cap rate: 7.54%
- This property offers 10 acres with 20 new homes ranging from 384 sq ft to 1296 sq ft each, with 10 mini storage units, 1344 sq ft office/clubhouse and 52 RV spaces. The property offers great views for its tenants and low maintenance for the investors.
- Location: Glendive, MT
- Year built: 1980
- Units: 124
- Lot size (acres): 35
- Building size: 110,000 SF
- Occupancy: 95%
- Cap rate: 7.77%
- This park is on city services, has low vacancy, and is prime for rent raises. Lot rent has not been raised since 2014. This is a 124 unit mobile home park with 95% occupancy, 64 park-owned trailers, and city water and sewer
- Location: Weslaco, TX
- Year renovated: 1992
- Units: 389
- Building size: 16,098 SF
- Lot size (acres): 28,36
- Occupancy: Seasonal, 50%-100%
- Cap rate: 7.88%
- The park is a gated community, and managers live on site. Numerous community & recreational facilities. Residents can choose from over twenty planned events including sports, music, card and board games, church and others. Much of the park is rented on a seasonal basis with up to six months of rent paid upfront. Off-season, the park averages half-occupied. The park offers sites for Tenant-Owned Homes, Park-Owned Homes, Park-Owned RV's, Transient RV's and Big Rigs.
- Location: Yucaipa, CA
- Year built: 1946
- Building size: 2,200 SF
- Units: 74
- Lot size (acres): 6.24
- Occupancy: 98%
- Cap rate: 4.95%
- This 74-unit park is centrally located within city and offers 24 hour access. Tenants can use on-site laundry facilities, clubhouse and picnic area. All utilities are sub-metered. Additional income can be generated by renting out the RV storage area.
- Location: Reno, NV
- Year built: 1945
- Units: 17
- Lot size (acres): 1.62
- Building size: 7,627 SF
- Occupancy: 100%
- Cap rate: 5.74%
- This is a private community in a park-like setting, consisting of 7 freestanding homes and 10 mobile home sites. The single-family residences have fenced yards and ample off-street parking. There is a new main waterline and blacktop paving. The community is well maintained and has loyal, long-term tenants.
- Location: Blythe, CA
- Year renovated: 1965
- Units: 104
- Lot size (park, acres): 7.48
- Lot size (land, acres): 2.72
- Occupancy: 82%
- Cap rate: 7.01%
- This park is an all-age community located in an Opportunity Zone. The Park sits on approximately 7.48 acres with an additional 2.72 commercial acres included with the sale (approximately 10.2 acres total). The park is comprised of 61 Mobile Home Sites, 42 RV Sites, and one Studio Apartment. The latest rent raise was scheduled for March 1, 2020. Burton’s has experienced onsite management and the park is conveniently located off Interstate 10.
- Location: Eureka, CA
- Year built: 1965
- Units: 71
- Lot size (acres): 22.74
- Occupancy: 98%
- Square footage: 990,554
- Cap rate: 4.34%
- This is a 71-unit mobile home park that also includes roughly 13 acres of Redwood forest acreage. The community consists of mostly double-wide spaces, is on city water and private septic services. The owner has recently completed a major capital improvements job, having invested roughly $400,000 towards completely rebuilding the roads, significant septic improvements, and tree trimming.
- Location: Fernley, NV
- Year built: 1971
- Units: 44
- Lot size (acres): 3.92
- Buildings: 3
- Occupancy: 100%
- Cap rate: 5.60%
- This park is located in the Opportunity Zone and consists of 30 mobile home sites, 11 RV sites and 3 commercial units with customer parking. Two of the commercial units are rented by The Moose Lodge (two buildings of 1,550 Sqft and 1,400 Sqft). The third commercial unit is 880 sqft and is rented to Investor Properties, LLC. The site rents and park owned home rents are under market and the potential for rent growth is positive. The community is professionally managed by a local property management company and is both organized and well-maintained.
Statistics Summary
| Occupancy | Year Built | |
| Property 1 | 95% | 2020 |
| Property 2 | 95% | 1980 |
| Property 3 | 75% | 1992 |
| Property 4 | 98% | 1946 |
| Property 5 | 100% | 1945 |
| Property 6 | 82% | 1965 |
| Property 7 | 98% | 1965 |
| Property 8 | 100% | 1971 |
| Average (portfolio) | 93% | 1973 |
Financial Summary
| Price | NOI | Cap Rate | |
| Property 1 | $4,950,000 | $373,230 | 7.54% |
| Property 2 | $3,850,000 | $298,962 | 7.77% |
| Property 3 | $6,149,000 | $484,388 | 7.88% |
| Property 4 | $3,663,000 | $181,490 | 4.95% |
| Property 5 | $2,200,000 | $126,222 | 5.74% |
| Property 6 | $3,294,500 | $231,061 | 7.01% |
| Property 7 | $5,390,000 | $233,996 | 4.34% |
| Property 8 | $2,365,000 | $132,333 | 5.60% |
| Total (portfolio) | $31,861,500 | $2,061,682 | 6.47% |
Financial Projections
RMHP is an all-equity deal. The properties are purchased with the capital raised from investors. These financial projections estimate the returns investors can expect, if they hold their tokens for five years from the initial sale/security token offering (STO). However, it is important to note that digital shares can be sold at any point after the holding period (one year). Moreover, investors can use digital shares as collateral for a loan – this scenario is illustrated on page 16. Property management fees are accounted for in the NOI calculations and vary from property to property. Note: Past performance is not indicative of future results.
Investors can choose to increase their return on investment by using tokenized real estate as loan collateral. The calculations below represent a scenario where all the digital shares (tokens) are used as collateral at an LTV equal to 70%. It is assumed that the loan is taken on the same day the digital shares (tokens) are purchased and the balloon payment is due at the same time as the property is sold.
Important note: RMHP will purchase the properties with 100% equity and no debt. This scenario is only to illustrate how investors can use the tokens they bought for a loan.
Market Overview
According to NorthMarq, after being stable throughout 2019, the national occupancy rate of mobile home parks improved in the last quarter reaching 93.8%. For the full year, the national occupancy rate rose 110 basis points. This marked the eighth consecutive year where the rate improved, and this was the second straight year where the rate rose 110 basis points.
Compared to 2018, occupancy in each geographic region improved. The South enjoyed the largest occupancy increase – with 340 base points over the last 12 months (97.1%). The occupancy rate of this portfolio (93%) is aligned with the industry average, as shown on the graph.
Rents in mobile home parks continuedon a steady upward climb during theyear. Rents reached $547 per month inthe last quarter, 3.7% higher than theprevious year. Each of the majorgeographic regions recorded annualrent gains in 2019. With occupancyrates stable or improving across mostareas and housing affordabilitycontinuing to present challenges, rentsfor manufactured housing shouldcontinue to trend higher.
Sales of mobile home parks gainedmomentum during 2019, rising 18% fromlevels recorded in 2018. Nationally, salesvelocity in the second half of the year was up6% from the first half of 2019, suggesting themomentum could carry over into 2020. Themedian price in 2019 was around $39,400per space, up 10% from the median price in2018. Prices for manufactured housing havebeen on a steady climb since 2014.
Nationally, cap rates averaged approximately 6.3% during the second quarter, down 60 basis pointsfrom the previous year. Cap rates varied widely across regions of the country (6.3% in Indiana versus5.8% in Arizona). The cap rate of this portfolio is slightly above the national average at 6.47%.
According to the Bureau of Economic Analysis’ estimate released in March 2020, the U.S. economy grewat an annual rate of 2.1% during the fourth quarter of 2019. The unemployment rate increased 60 basispoints from one year ago, reaching 4.4% in March 2020, due to the coronavirus pandemic.
Dividends and Ownership
REINNO Mobile Homes Portfolio is a Real Estate disruptor. RMHP is offering fractional ownership of commercial real estate in the US in the form of digital shares (tokens). 100% of NOI is distributed to token holders as dividends every quarter. The default currency is USD but investors can also choose to receive dividends in stable coins. The company offers a pure equity portfolio of stabilized income-producing real estate in the USA. This way investors can individually decide if they want to leverage their tokens for debt and higher ROI or keep it as is for lower risk.
The properties included in this portfolio represent the assets that RMHP intends to buy upon successful capital raise. In case one or more of the properties become unavailable during the raise, RMHP is responsible for finding an asset with comparable parameters (size, income,location, return, etc).
location, return, etc).The Purchase and Sale Agreements are expected to be executed one month after the soft cap(the minimum amount that has to be raised to buy the first property) is reached.
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Team and Partners
The RMHP team is comprised of seasoned professionals who have comprehensive real-world experience in the commercial real estate, financial markets and law. RMHP has an Investment Committee responsible for making decisions related to the acquisition, investment, asset management and disposition of properties. The RMHP team was assembled to continue the historically successful real estate investment activities of its members, targeting a broad range of real estate assets, portfolios, and companies.
RMHP’s strategy includes sourcing opportunistic investments through its proprietary network of owners and agents, as well as financial, accounting, and legal professionals. These include generally inaccessible bilateral deals and off-market transactions. These types of investments typically require significant experience in commercial real estate deals. RMHP will always favor income-producing properties with stable tenants and growth potential.
RMHP equity offering is backed by REINNO. REINNO is the first company in the world to accept tokenized real estate as loan collateral. RMHP is using the legal framework approved by REINNO for this offering, which allows investors to use their tokens as collateral for instant, paperless and flexible loans up to $50M. In order to provide the greatest liquidity for its investors, REINNO secured secondary market listing opportunities for RMHP at ADAX. ADAX is a registered security token exchange. The tokens will be available for trading after the holding period of 1 year. RMHP is using a trusted escrow provider; for more details please refer to the Purchase Agreement.
RMHP is managed by a professional team with more than 60+ years of combined experience. Bravo Capital Advisors is an asset management company responsible for assigning appropriate property management providers to the real estate assets included in this portfolio. The properties are managed by local or on-site service providers to decrease the risks and optimize performance.
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DISCLAIMER
This offering has been prepared by Mobile Series, a designated series of Reinno Series, LLC. All materials and information received or derived from Mobile Series, a series of Reinno Series, LLC its directors, officers, agents, advisors, affiliates and/or any third party sources are provided without representation or warranty as to completeness, veracity,or accuracy, condition of the property, compliance or lack of compliance with applicable governmental requirements, develop ability or suitability, financial performance of the property, projected financial performance of the property for any party’s intended use or any and all other matters.
Neither Mobile Series, a series of Reinno Series, LLC, its directors, officers, agents, advisors, or affiliates makes any representation or warranty, express or implied, as to accuracy or completeness of the any materials or information provided, derived, or received. Materials and information from any source, whether written or verbal, that may be furnished for review are not a substitute for a party’s active conduct of its own due diligence to determine these and other matters of significance to such party. Mobile Series, a series of Reinno Series, LLC will not investigate or verify any such matters or conduct due diligence for a party unless otherwise agreed in writing. Any party contemplating or under contract or in escrow for a transaction is urged to verify all information and to conduct their own inspections and investigations including through appropriate third party independent professionals selected by such party. All financial data should be verified by the party including by obtaining and reading applicable documents and reports and consulting appropriate independent professionals. Mobile Series, a series of Reinno Series, LLC makes no warranties and/or representations regarding the veracity, completeness, or relevance of any financial data or assumptions. Mobile Series, a series of Reinno Series, LLC does not serve as a financial advisor to any party regarding any proposed transaction. All data and assumptions regarding financial performance,including that used for financial modelling purposes, may differ from actual data or performance. Any estimates of market rents and/or projected rents that may be provided to a party do not necessarily mean that rents can be established at or increased to that level. Parties must evaluate any applicable contractual and governmental limitations as well as market conditions, vacancy factors and other issues in order to determine rents from or for the property. Legal questions should be discussed by the party with an attorney.Tax questions should be discussed by the party with a certified public accountant or tax attorney. Title questions should be discussed by the party with a title officer or attorney.Questions regarding the condition of the property and whether the property complies with applicable governmental requirements should be discussed by the party with appropriate engineers, architects, contractors, other consultants and governmental agencies. The buildings presented in this offering are subjects to change and can be replaced with similar buildings of comparable financials, characteristics and parameters. All properties and services are marketed by Mobile Series, a series of Reinno Series, LLC in compliance with all applicable fair housing and equal opportunity laws.
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* Some equity offerings might not provide dividend payments and offer higher capital gains instead. Please check the offerings to understand their respective terms.