Posted by Ernest Tew on September 20, 2001 at 06:03:12:
Mike, we are approaching the time when developers should be considering the development of more parks. It appears that most parks are experiencing low vacancies.
However, if you are not an experienced developer with lots of available cash and time to do it, I would not advise taking on such a difficult task–for numerous reasons:
In most areas, it is extremely difficult to get zoning and other approvals from local government. Even if you could, the requirements make it very costly.
In many areas the lot rent that could be charged is too low to make it economically feasible, considering the high cost of land and development.
It will take a minimum of 18 months from the time you start until you can complete the development.
Upon completion, you will have operating expenses while starting out with a project that is 100% vacant. Some parks, especially those developed for senior citizens, can take up to ten years before they produce enough income to cover operating expenses and mortgage payments. In the meantime, the owner needs to be in a position to subsidize the losses.
In short, there are safer and more profitable things you could do with your time and money.