The Perils Of Hiring The Manager From The Park Down The Street

Eventually the manager at the mobile home park down the street will inquire about being in charge of yours. Or one day you’ll get jealous that the community a few blocks over is nicer or fuller than yours and you’ll say “I wonder if I should approach that manager to work for me?”. In this Mobile Home Park Mastery podcast we’re going to drill down on this concept and give you case studies of how that concept typically tuns out.

What is Mobile Home Park Mastery?

Welcome to the Mobile Home Park Mastery Podcast where you will learn how to identify, evaluate, negotiate, perform due diligence on, finance, turn-around and operate mobile home parks! Your host is Frank Rolfe, the 5th largest mobile home park owner in the United State with his partner Dave Reynolds. Together, they also own and operate Mobile Home University, the leading educational website for both new and experienced mobile home park investors!

Every park owner one day will receive a call from someone who's the manager of the park down the street, and they'll be all excited about the idea of having that manager come and manage their property. Or maybe you'll be driving around looking at your competitors, and you start to daydream how great would it be on this well run park for me to hire away that manager or bring them to my property and make my property as nice as this one would be? But the question always is, is that a good idea? This is Frank Rolfe for the Mobile Home Park Mastery Podcast.

We're gonna talk about the concept of bringing in a manager from another property down the street into your property, how that really turns out. And this is a topic we have lots of experience on, because we've been owning parks now and running them for 30 years, and we've had more than one time that that has occurred but we've always had consistently just pretty much the same results. And the answer is, it normally doesn't work, but let's apply some science as to why having the manager down the street come to your property doesn't always lead to the same results as you see in that community that you so coveted. It seems almost a violation of the 10 Commandments though. Covet thy mobile home park manager down the street.

So why would that not work out? Well, the first thing you come to find out when you bring in the manager from down the street is you quickly learn sometimes that the manager was not the driver to the success of that property. That property may have a superior location to yours. That property may have a customer base that was well groomed over the decades of people who pay their rent and maintain the property and yet your property's just starting out 'cause mom and pop never did such a good job at that.

It may be that that manager came on the scene after all the heavy lifting was done and the park was in perfect condition and everyone was paying and following the rules and it was a completely full, and then that manager appeared, but they weren't there back in the days when the heavy lifting was going on. There's a million reasons why that manager may not be the critical element that makes the other property work. Location issues, age issues, layout of the park. There's a million reasons why you will not get the same results from that person that you think they're providing at the park that's down the street.

Another problem you have typically when you hire the manager from the park down the street is, they've gotten lazy over time because they're running a park that's in perfect condition. Your park probably isn't in perfect condition and that's why you're so excited about this concept. But from their point of view, they're used to a day which is devoid of many, many problems. They may not be answering the phone or showing homes or doing any CapEx issues, because it's already been done down the street. And they might've even been there when all that was accomplished, but hey, that's in the past, this is the present. They don't wanna do that anymore. So often, they really don't wanna get out there and do the tough work you may need in your turnaround, because they've moved on to another stage of their life.

Another issue you frequently have is that the owner of the property down the street has instilled very bad management habits in the manager. I'm sure we've all seen that when you buy a park from mom and pop, and you have the manager that they have personally trained and supervised for all these years now, and there's probably no worse playbook in the world than the one they've been taught. They don't really do anything by the book. They don't do anything correctly. They don't have to show up at certain hours of the day or days of the week and they don't create paper trails. And it's kind of haphazard and random, kind of like some of the mom and pops are. So often, when you're hiring a manager from down the street, what you're really getting is not only the manager, but also a tinge of the old mom and pop. And that's not reflective of what you want in your business. That's not going to really take you to the next level.

Another big issue when you hire the manager from down the street is you often tend to overpay, because the manager was probably pretty well compensated at the park that you are so covetous of, the one that looks nice with everyone paying and the rules fully enforced. So as a result, mom and pop could pay maximum amounts because they had a lot of rent coming in the door. But now, here's your property which you're trying to turn around and you don't have anywhere near their occupancy, or anywhere near their revenue. And as a result you really can't afford to pay the manager what they were making, and even worse, they're gonna want a raise. They're gonna want even more money because they're now coming onto a property that needs a lot of work, where they were at, it didn't have a whole lot of work. So as a result, they're gonna demand more. Can you really afford to pay more? Is that really going to work for you?

Also, remember that park down the street, it may be larger than your property, so right off the bat you probably can't even afford to match what they were paying. And another big issue we have when you take the manager from down the street often is that the manager down the street, they've already jumped ship once. It's always a bad thing with managers when they do a lot of movement, because traditionally when they do a lot of movement, that means they're gonna be moving on you too. And that may not in any way work towards the goals of what you have. You may want a manager that's very stable, a real team member, somebody who isn't thinking all about the dollars and the cents, but they're all concerned about all the great things they're gonna do for your property.

So as a result, you're hiring somebody on that really isn't on your team, they're just in it for the buck. And as soon as you hire them and get them going and train them, the next thing you know, they come to you and say, I need even more money. That never works with a manager. Mobile home park managers to succeed, they can't really be money focused. They gotta have a bigger goal in life than just that. And there's nothing more irritating than the manager that comes back to you on a constant basis wanting a raise.

Now let me give you some stories of managers that we've taken from down the street and how those worked out in reality. One of my early parks, there was a manager at a property, and it was a property that I'd always been told, oh, that property is such a good property. So I went out to them and said, Hey, I've got this new property, we're trying to turn it around. We'd love to have you come down here and do your magic because you've done so good up here. And lo and behold, it was a total fiasco. They just could not get the job done. They didn't want to, they didn't wanna get themselves dirty. They'd already moved on to another plateau in the world of management and I was really a step down for them. So after a while it clearly didn't work and we parted ways.

And then not too long ago, we hired the manager of a large property that was fully turned and running well to take over a turnaround that we were working on. And once again, didn't get very good results, because that manager once again was used to staying in the air conditioning in the office, occasionally answering a call or maybe someone bringing them a check or money order. And what we needed was someone who was a go-getter, who would answer the ad and show homes all day long and yeah, it's hot and sweaty when the temperature is up outside doing that and all, but that was really the job we needed. So once again, we didn't get a great net effect. In fact, I can't really give you an example ever that we got a manager from another property down the street and it worked out well. It just typically is not the correct move if you are trying to get your park in better condition.

Now of course, part of it may be the way that things have changed so much with managers, because it used to be the manager was more of a bookkeeping managerial role before the advent of good software and ACH payment. So the manager really was more about numbers and systems than people. And the problem is that, today, where we have ACH payments and software system, the manager's true role is just being a people person. And that means their prior experience is much less important than it ever was before.

I would rather have somebody that has no mobile home park experience at all but terrific people skills. That manager would succeed more than any other. So perhaps, maybe part of the problem is when you see these parks that have been turned and are running well, maybe the skillset you need today is not the same skillset that that manager shares. The bottom line to it all is that every candidate must be looked at independently and individually. And there may be good fits for you out there of people who have worked in that mobile home park down the street, but do remember it's not typically the be-all and end-all that many people imagine. This is Frank Rolfe, the Mobile Home Park Mastery Podcast. Hope you enjoy this. Talk to you again soon.