Lakeridge Estates MHP
Huntsville, OH | Off-Market Acquisition | March 2024
Overview
Our latest venture in Central Ohio, the Lakeridge mobile home community is delivering an immediate $1.5 million in instant equity, equivalent to an impressive 29% return on equity to Fund 4 investors from the outset. This exceptional opportunity underscores our commitment to identifying and capitalizing on undervalued assets to generate immediate value for our investors.
About the Project
Lakeridge is a wholly unique asset – for Fund 4 and in general. This is 105 mobile home parks on a beautiful lakefront in Central Ohio. Each home has its own personal dock and seawall, perfect for recreation and watersports. This is an unparalleled blend of luxury with affordability, providing both exceptional affordable housing for as well as very reasonably-priced vacation homes for working Americans . Managed by Sunrise Capital Investors, Lakeridge is more than just an investment—it’s a strategic endeavor to enhance lifestyle and investment returns concurrently.
The Challenge
Our strategy for Lake Ridge includes a light value-add approach, focusing on two main areas: recapturing lost lease by adjusting below-market rents to current rates, and improving operational efficiencies, such as implementing utility billing. These steps are anticipated to significantly increase the community’s value without relying on the more challenging infill process. We aim to implement reasonable 5% rent increases, yearly – to boost your bottom line and ensure residents are happy.
The Plan:
Specifically for Lake Ridge, we have it under contract for $13.6 million, with an appraised value of nearly $15.2 million, providing $1.5 million in instant equity. This acquisition further increases the cumulative sweat equity in Fund 4 to $6.9 million. With planned improvements, we project the park’s value to reach approximately $18.2 million within the first two years, nearly doubling our investment.
Additionally, we’ve secured a favorable loan with a 3.3% interest rate for the next eight years, enhancing the deal’s attractiveness by ensuring strong cash flow. This loan, combined with our planned improvements, positions Lake Ridge as a highly lucrative investment, promising both immediate returns and long-term growth.
The Outlook
Situated in a region with a burgeoning demand for affordable, high-end recreational living, Lakeridge stands out as an irreplaceable property. With its 100 all-waterfront spaces, it caters to a significant market niche, underpinned by a strong demand for luxurious yet affordable waterfront living options. The economic and lifestyle appeal of Central Ohio, coupled with the property’s unique positioning and the substantial instant equity generated upon acquisition, positions Lakeridge as a highly desirable investment. This offers investors a promising avenue for sustained and robust returns, capitalizing on the unmatched appeal and potential for rental growth in a market where such offerings are scarce.