Closed: Gold-Line Townhome (Azusa, CA)

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Manufactured Home Parks Now a Low-Risk Bet, Commands $230 Million in Arizona

Manufactured homes, like mobile homes, are prefabricated structures that are transportable. However, unlike mobile homes, these buildings were built after 1976 and to the standards set forth by the US Department of Housing and Urban Development. These homes provide an affordable housing option for low-income individuals while being an eye-catching asset class for investors.

Recently, The Carlyle Group bought a huge portfolio of manufactured homes in Arizona. In fact, this purchase was one of the biggest deals, in recent history, for this kind of affordable housing.

The four properties, all composed of hundreds of separate manufactured home lots, sold for $230 million. In total, there were 1,588 individual units across all four of the properties, which are all located in Mesa, Arizona.

While many investors don’t see the benefits to manufactured home park investing as a particularly attractive long term investment the financial returns associated would most likely cause them to reconsider. Given their affordability in the wake of the COVID19 pandemic, the financial opportunity that manufactured home investments provide make them the perfect investment in the current world climate.

Manufactured Homes Seeing Increase Due to COVID19

With more than 40 million Americans currently out of work, many will likely turn to manufactured homes and the Carlyle Group hopes to capitalize on that trend. While The Carlyle Group is in recent news, they aren’t the pioneers of this form of investment. Last year, Blackstone Group bought four similar properties around Phoenix, Arizona for a whopping $55.1 million. Clearly, some big-money players see the opportunities that lie in manufactured home investments.

Unrelated to the coronavirus pandemic, manufactured homes are still in increasing demand nationwide given the increasing housing costs that many Americans simply can’t keep up with. Since manufactured homes are an affordable alternative to regular single-family homes and apartments, they are the perfect answer.

From an investor’s perspective, manufactured homes provide incredible returns despite their low initial cost and high occupancy. On top of that, while it takes a lot of money to maintain a normal home, manufactured homes are a fraction of the cost to keep up.

For all of these reasons, investors have become increasingly interested in this new niche of real estate investing. This is true especially in the Western United States where land is cheaper and manufactured homes are more popular.

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Project Details

Location: Los Angeles, CA

Asking Price: $1,078,000
Location: Downtown
Bedrooms: 2
Bathrooms: 2
Parking Spaces: 2
Square Footage: 1,606 SF (AP)
HOA: $470
Type: Residential / Condominium
Price Per SF: $671 / SF
Year Built: 2009
Tenant-Occupied / Month-to-Month

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