Never just mobile homes, right!?
After performing due diligence on hundreds of communities, our team has seen just about every structure out there. We will never see them all but here is a comprehensive list of other structures we have run into and how we audited them.
Keeping this article short and sweet, we will list everything we can think of below, with bullet points, and how we approached it. If you have any in mind that you want us to add, let us know! We may have dealt with it already but forgot to add it to the list.
Also keep these two overarching questions in mind:
#1. Are you giving it value?
If you have given a structure value, then make sure you determine the age and its life cycle left before major cap ex is needed or all together having to scrap the structure. Will it cost you more to repair/replace it than potential income/value?
#2. What liabilities can come from a structure?
Even if you are not giving any value to a structure that comes with the park, some structures will carry more liability that others. Ask yourself, can this cause decapitation, collapse on someone, spill on someone, something that would attract kids to play on it, trip and fall hazards (most popular mobile home park insurance claim), cause breathing problems, contamination issues, catch on fire easily, flood easily, explode? Are you prepared to re-trade (ask for an adjustment to the price) to have seller clean-up/remove liabilities? Or what will it cost you to scrap/ remove it later on?
List of other structures
- Private water utilities: Water wells, water tanks, water pumps, and city water that must be tested... been there, done that. Not covering this on this list as we could write a book about just water utilities.
- Private sewer utilities: WWTP (wastewater treatment plant), lagoon, septic, leach field, and trash can toilets... been there, done that. Not covering this on this list as we could write a book about just sewer utilities.
Somewhat Common Structures
- Apartment: We’ve seen concrete apartments, four plex mobile homes called apartments, and apartment floors over other structures like a garage or office.
What to do: you can get a residential home inspector or possibly a commercial building inspector if you want the building to be looked at as close as possible (foundation, HVAC, insulation, mold, etc.). Or, if inspecting it yourself, you will want to check everything from the basement/crawl spaces to the attic. For due diligence services, we look for any signs of mold, settling, flooring, ceiling, leaks, and appliance/fixture/water/window/door issues. We also make note of any model/year information listed on HVAC/water systems.
What to do: same as above
- Office Building
What to do: same as above
- Clubhouse Building
What to do: same as above
- Bathroom / Outhouse Building
What to do: same as above
- Pool and Spa: We have seen so many different types of pools and hot tubs.
What to do: for due diligence services, we always audit everything, especially since we approach everything with a skeptical eye and assume it is broken unless proven otherwise. To add an inspection layer, hire an inspector that specializes in pools and spas that can systematically test equipment and perform various system tests as well as make recommendations on parts that need to be replaced. To rely on your own inspection, we suggest taking pictures of everything and doing a video narration of all equipment and how it works (what we do).
- Boat Docs
What to do: buy a boat😊. Just kidding. The main thing we look for is rot and trip and fall hazards since boat slips can also attract children to play on them. Docs are often neglected, with wood falling off or nails and screws missing. If a doc hasn’t been maintained, you will need an engineer to look at it or plan to replace it.
- Vending Machine(s)
What to do: document the condition, type, age, and who maintains it. If a vendor maintains it, get a copy of the service agreement. Find out what the terms and expiration date are for the agreement. Consider the costs. Does the cost of electricity, maintenance, and throwing away old products justify keeping a vending machine?
- Laundry Room Building
What to do: document the condition, type, age, and who maintains it. If a vendor maintains it, get a copy of the service agreement. Find out what the terms and expiration date are for the agreement. On average, vendors that maintain washers and dryers for you will take a 50%-75% cut of the profits. This is well worth it if they maintain everything. Often, the vendor can also do direct deposit. Newer equipment can give residents the option to pay through an app. Consider the costs and liability. Laundry rooms can come with liability since they are a place where people can get trapped or injured. Many operators do not realize that laundry rooms can break even or lose a lot of money. The cost for water, electricity, cleaning, and security can add up. Some operators want to keep a laundry room that loses money while not realizing there is a better public laundry facility nearby.
- Storm Shelter
What to do: notice if it works! Seriously, an underground storm shelter needs to work. Evidence of it not working may include mold or signs of prior flooding and cracked walls. Costs to fix or replace a shelter can be significant. Document the size, type, and make note of how well the opening and closing works. Make note of how many residents it would accommodate.
- Park Model
What to do: check the local city code to see if the park can legally accommodate park models. To do this, look up the land usability chart for the zoning type. You don’t want to have to pull these homes out if they were placed without permission. For due diligence, usability is one of our many questions to the city. You want to have in writing what types of structures are permitted in case it is changed on you later by the city.
- Tiny Home
What to do: same as above
- Storage Units (building)
What to do: we treat storage units the same as any other structures fixed to the ground. It is critical that you check the sizes, occupancy, and condition of all storage units top-down and sideways. This includes foundation, walls, utilities, and roof. If units are locked and cannot be open, it is important to access a good sampling of units, even if that means that the operator must coordinate access before your inspection. It is critical that you audit the rent roll for storage units to see if what appears to be occupied matches the rent roll.
- Storage Units (shipping containers)
What to do: check the local city code to see if shipping containers are allowed. To do this, look up the land usability chart for the zoning type. You don’t want to have to pull these out if they were placed without permission. For due diligence, usability is one of our many questions to the city. You want to have in writing what types of structures are permitted in case it is changed on you later by the city.
- Dry Storage
What to do: treat dry storage the same as any other occupied or vacant lot. Just because it is dry storage and may be less rent or a perk, neglecting any lots can spring up surprise liabilities and cost. Dry storage lots may have chemical spills, trip, and fall hazards, broken utility connections if any are present, drainage issues, and a host of other deferred maintenance issues.
What to do: look for liabilities! Playgrounds are a hotbed of liabilities and potential claims from residents. Document condition of everything on the playground with pictures and video. You will likely check video later for conditions since it can be difficult to picture everything from every angle. We document quality, liabilities, anything broken or worn, maintenance arrangement, and if playground or playscape should be included for the community. A playground may not make sense for all communities. The variety of playground equipment is endless – playscapes, kiddie pools, picnic tables, tree swings, tree tire swings, long jump sand pits, horseshoes, shuffleboard courts, mud pits, monkey bars, spring animals, ropes, balance beams, balancing poles and boards, workout equipment, and whatever else you can imagine.
- Sport Court
What to do: see list above. Document ALL the court surface and all areas around the court that could be potential trip and fall hazards. Document all fencing. Fencing around sports court can often be broken, missing, and have wooden or metal parts poking out. Document all equipment and make note of age, any rust, and any problems. One time, we observed the tennis court from different aerial photographs but when we documented it in person, the court had become so overgrown that there was hardly a tennis court left, the concrete foundation had broken up over time as vegetation grew up and through everything.
- Parking Lot
What to do: make note of materials and condition. Many communities have additional parking areas or a designated parking lot. Make note of materials, and any painting or striping. To avoid liability, spaces and curbs may need to be marked for fire and safety. Make note of any signs or missing signs that need to be added for parking lot safety and charges.
- Guard Hut
What to do: fancy😊. Some communities, especially repost style parks may have a guard shack that is used for security, other reasons, or abandoned. We’ve probably seen more abandoned ones that ones in use. They may appear okay from the outside but be a disaster inside with rot and debris. Document all materials, size, and condition. Make note if there is anything connected to the hut or shack such as utilities.
- Semi-truck Trailers
What to do: treat the same as shipping containers above. We’ve seen semi-truck trailers left with and without the truck! Some operators will have used it as a truck at some point but then abandon it over time. This can be a big cost to remove if it has been neglected, rusted, and can no longer be pulled away. We open EVERYTHING! Make sure you open anything like this to be aware of what can lurk inside and if the doors even open, they may be rusted shut. Or is someone living in there?
- Satellite Tower
What to do: request the lease contract. Make note of the details for rental amount, lease term, and maintenance and easement access and arrangement. Can it be removed or was provider given an indefinite lease/easement?
- Wind or Solar Farm
What to do: request vendor contract and all utility bills for the operation of a wind or solar farm. Pay attention to the contract details for financial details, lease term, and maintenance arrangement.
- Dog Park
What to do: document condition and liability for everything at the dog park. Ask about any historical problems. Consider if dog park should be an amenity offered. A dog park is not appropriate for all communities. Consider who is maintaining the park and what liabilities could arise from having lose pets, people, and children together that may not be acquainted with each other.
What to do: score! Many cities now have moratoriums on adding more billboards. If you have one already in place, then great! Make note of the foundation, quality of foundation and sign, and if there are any advertising agreements in place. Make note of contract details for billboard lease. Billboards can add significant value and income to a property.
Illegal or Redneck Structures
What to do: buy a tractor – JK. Barns are a lot to inspect! Especially if it is a big barn. A barn alone can take over an hour to inspect so consider how long you will be onsite. Inspecting every part of the barn, including all parts of the interior can take a lot of time. Consider how long it will take to inspect the interior if there is hay, debris, vehicles, and other equipment in the way, blocking easy view of the whole structure. Consider everything that can go wrong with a barn and who is maintaining it. Is the barn weather proofed?
- Cactus Farm
What to do: document if there are any utilities involved such as irrigation or electric. Are chemicals used or anything else that could be hazardous to residents? Consider if any type of garden or farming is appropriate for the community in terms of benefit and liability.
- Chicken Coops
What to do: make scrambled eggs… and the jokes keep coming. Chickens and other farm animals can be a big quandary for rookie operators. Traditional rules do not allow for any poultry or other farm animals. On the other hand, we have seen that chickens can blend into some rural settings. If they happen to blend in aesthetically and culturally, consider and document the following – are they in a location that would cause any disturbance to tenants, what liability could arise, and is there a tenant disruption if you require removal. Document overall condition of tenant’s home and lot. Some operators may grant or grandfather owning a chicken if the tenant is in good standing. Local code will also govern if poultry is allowed.
- Chop Shop
What to do: shut it down! Any type of vehicle maintenance, parts maintenance, or build shop is often an eye sore, and can be a liability nightmare. Document the cost of having to remove such as structure and potentially items and debris that can weigh tons in addition to being hazardous. Notice if HazMat needs to get involved to remedy and remove hazardous chemicals or debris. Even if removal is eminent, document all material types, items, and condition. Many operators are happy to leave you with the cost of somehow removing heavy hazardous structures and debris.
- Dog Breeding Kennels
What to do: serve eviction notice on day one if possible. Audit existing leases and tenant agreements to determine if an exception was made. If an exception was made, determine how you will require removal since insurance company will likely not ensure your community with certain breeds. Documents kennels and animals. Ask for complaint history and document lose pets. Note, even if existing operator made exceptions, it should be possible to evict for lose or aggressive animals. Request open records from the policy station and animal control for calls made. Often, these records can be used to easily remove or evict tenant for improperly managed animals.
- Illegal Operations Shop
What to do: shut it down or take your chances forming an alliance with the Cartel. We strongly encourage you to shut it down immediately if you acquire the property. We’ve seen all kinds of shady and illegal operations. You must demand access to EVERY STRUCTURE. If you do not, you risk finding out about something crazy after closing. If an operator uses any kind of excuse to not inspect a structure, then reschedule the inspection until you can. If an operator is taking a blind eye to a tenant doing something shady, they may use the tenant as a scapegoat for not inspecting structure, due to tenant’s privacy rights. Obviously, this is BS. The park owns and reserves the rights to inspect any structure the park owns. If it is a tenant owned structure, then demand the operator to coordinate with tenant to provide access on the day of onsite due diligence.
- Tree Houses
What to do: remove them. Yes, this can be sad to do, especially if you have fond childhood memories of one. Unfortunately, this is a liability and a non-approved structure for insurance coverage. Document location, condition, and cost to remove if it additionally requires tree removal to properly remove.
Don’t see something on the list that you have come across? Amuse us and send it – we will highlight your finding. Please note, even though we may not have mentioned pictures and video for each item, pictures and video are almost always required for every single structure. If it is a large property, this can add up to thousands of pictures and dozens of videos, exactly why it takes us days and nights documenting everything onsite.
We’ve seen a lot but can NEVER see it all when it comes to performing due diligence on parks. We have excluded any extreme criminal items such as meth labs.
Lastly, we want to hear your opinion. Do you have anything to add, to disagree with, or improve on this list?
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