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  • Andrew Keel

Interview with Craig Napoliello of 40 Oaks Properties



Listen on Apple Podcast here: https://podcasts.apple.com/us/podcast/interview-with-craig-napoliello-of-40-oaks-properties/id1520681893


SHOW NOTES


Welcome back to the Passive Mobile Home Park Investing Podcast, hosted by Andrew Keel. On this episode of the Passive Mobile Home Park Investing Podcast, Andrew talks with Craig Napoliello of 40 Oaks Properties. Andrew and Craig discuss the benefits of geographical targeting when managing mobile home parks from an operational standpoint, monetizing park owned homes versus tenant owned homes, and the significant benefits of scalability when buying mobile home parks.


Craig worked as a fixed-income trader for a large portion of his career and now works at a fintech firm. After he acknowledged his growing interest in real estate and dabbled in single-family home investments, he began his multi-family journey in the beginning of 2019. When he's not at his W-2 job, Craig loves to learn new ways to build generational wealth through mobile home parks and other investment real estate.


Andrew Keel is the owner of Keel Team, LLC, a Top 100 Owner of Manufactured Housing Communities with over 2,000 lots under management. His team currently manages over 30 manufactured housing communities across more than ten states. His expertise is in turning around under-managed manufactured housing communities by utilizing proven systems to maximize the occupancy while reducing operating costs. He specializes in bringing in homes to fill vacant lots, implementing utility bill back programs, and improving overall management and operating efficiencies, all of which significantly boost the asset value and net operating income of the communities.


Andrew has been featured on some of the Top Podcasts in the manufactured housing space, click here to listen to his most recent interviews: https://www.keelteam.com/podcast-links. In order to successfully implement his management strategy Andrew's team usually moves on location during the first several months of ownership. Find out more about Andrew's story at AndrewKeel.com.


Are you getting value out of this show? If so, please head over to iTunes and leave the show a quick five-star review. I have a goal of hitting over 100 total 5-star reviews by the end of 2021, and it would mean the absolute world to me if you could help contribute to that. Thanks ahead of time for making my day with your five-star review of the show.


Would you like to see mobile home park projects in progress? If so, follow us on Instagram: @passivemhpinvesting for photos and awesome videos from our recent mobile home park acquisitions.


Talking Points:

00:21 - Welcome to the Passive Mobile Home Park Investing Podcast

01:25 - Craig's journey into real estate investing

06:25 - Funding: raising money for deals or personal money

09:30 - Craig's first MHP deal in North Carolina

15:06 - The toughest hurdle to overcome in mobile home park investing

15:31 - Craig's management company

17:45 - Learning from mistakes in manufactured housing communities

19:20 - Tenant-owned homes, park-owned homes, and rent-to-own

24:30 - Changes in viewpoints from when Craig bought his first MHC portfolio

28:15 - Buying smaller mobile homeparks

31:48 - Important points passive investors should know about the mobile home park space

35:33 - Bringing over skills from Craig's W2 job. 37:32 - Getting a hold of Craig

37:52 - One final tip

39:15 - Conclusion



👇 SUBSCRIBE TO PASSIVE MOBILE HOME PARK INVESTING PODCAST YOUTUBE CHANNEL👇 https://www.youtube.com/channel/UCy9uI3KGQmFgABsr9lUtRTQ



Links & Mentions from This Episode:

Craig's email: craig@40oaks.com

Keel Team's official website: https://www.keelteam.com/

Andrew Keel's official website: https://www.andrewkeel.com/

Andrew Keel LinkedIn: https://www.linkedin.com/in/andrewkeel

Andrew Keel Facebook page: https://www.facebook.com/PassiveMHPinvestingPodcast

Andrew Keel Instagram page: https://www.instagram.com/passivemhpinvesting/ Twitter: @MHPinvestors

 

TRANSCRIPT


Andrew: Welcome to the Passive Mobile Home Park Investing podcast. This is your host, Andrew Keel. Today, we have an amazing guest in Mr. Craig Napoliello. Before we dive in, I wanted to ask you a real quick favor. Would you mind taking an extra 30 seconds and heading over to iTunes to rate this podcast with 5 stars? This helps us get more listeners, and it means the absolute world to me. Thanks for making my day with that review of the show. All right, let's dive in. Craig spent the majority of his career as a fixed-income trader and now works at a fintech firm. After being interested in real estate for much of his adult life and dabbling in single-family home investments, he began his multi-family journey in the beginning of 2019. When he's not at his W-2 job, Craig loves to learn new ways to build generational wealth through mobile home parks and other real estate. Craig, we're excited to welcome you to the show.

Craig: Thanks for having me.

Andrew: Maybe you can start out by telling our listeners your story and how you ultimately got into the wonderful world of manufactured housing.

Craig: I'll keep the story around the real estate piece of it, but I've always been interested in real estate. Now, I've been actively thinking about it, but when I look back on my adult life, I'd go to a city, go online, look up single-family real estate, what things are renting for, what they were worth, and all those types of things. The natural interest is always there. Then in 2019, my sister-in-law introduced me to BiggerPockets, so I started going down the rabbit hole. I think that the big shift in mindset then was real estate as a business versus real estate as a hobby. I started teaching myself. I listened to BiggerPockets and started listening to podcasts like yours. It's amazing how many free resources there are out there in the world. You can make yourself dangerous in a few months of really diving deep into some of these podcasts. I did that, and I purchased my first duplex that year. Again, it's this whole shifted mindset around how do I make this a business, how do I structure a team, and how am I doing things that can become scalable. I bought a duplex that year. I went from a duplex and then bought a 21-unit, a 10-unit, and a 22-unit all multi-family in New Hampshire. What happened there was I got myself in the arena and I started thinking about where can this go? What can this mean for me? Just looking at this unit much more from the bigger-picture standpoint. That's when COVID hit. I live in New York City, so things here were very much locked down. Now, all of a sudden, my wife and I were spending a lot of time at home. I have a lot more time on my hands and I wanted to use that in a positive way. I spent a lot of my extra time teaching myself about mobile home parks, which I think probably many folks do. I really have a genuine interest in real estate. I think that manufactured housing is the best vehicle for a long-term investment, but I do have a genuine interest across the board and real estate, so I was researching different types of real estate. I came across manufactured housing as I'm sure you've probably on the same boat. There were a lot of characteristics about manufactured housing that I liked more than multi-family, so I said, wait a second, I'm in all these multi-family projects that I've learned a ton from. I made a ton of mistakes, but I've added enough value that I have a bunch of equity in these properties in a short amount of time. If I think that manufactured housing is a better vehicle for my investments, why am I not doing that? I joined a mentorship program, I was listening to podcasts like yours and teaching myself about manufactured housing, and then I started making action steps and following those. This is all during COVID. I was just sitting literally in my house with my wife trying to formulate a game plan for how I could go from my multi-family into manufactured housing. Literally what got me into the game in manufactured housing was it was the only time I got on a plane for an 18-month period. I'm a person that travels. My wife and I travel all the time. The only time I got on a plane for an 18-month period was me going down to North Carolina to meet with the owner of the portfolio that we ended up buying. At the time, I had zero pads. My wife and I canceled several trips and whatnot. I said, I'm going to go down to North Carolina. I'm going to meet this gentleman I've been speaking to. She was like, are you serious? I'm not telling you I'm not being supportive, but this is a huge waste of your time. You don't know this guy and this seems like a little bit of a wild goose chase. Obviously now, both of us are very grateful that I made the trip. That's what vaulted me into manufactured housing. I was able to build a rapport. I think the guy really respected the fact that I came down there to meet him. I was coming in from New York. I spent time with him, got to know him, and built a rapport with him, and that made all the difference in us ending up partnering and him transitioning his assets to me. That was the beginning of it, and then I went from there.

Andrew: That is so awesome. I love that. You started with the multi-family units. Were you raising money for those deals or was that just your personal money?

Craig: That was my personal money. I had a buddy that saw what I was doing. He’s a guy that I've known for 20 years. He actively said, hey, listen, I'd love to come along for the ride and just learn about this. Some of those products were on my own and some of them I split 50-50 with this good friend of mine. Our current business, I would classify it much differently. All the multi-family in New Hampshire was my first step into professionalizing an operation. I had a property manager handling everything in New Hampshire. In this business now, the manufactured housing business, we're vertically integrated which is a much different undertaking, I have to tell you. This business looks a ton different than my previous multi-family business. In this business, I went into it with a certain expectation of, okay, great, I'm going into a new asset class, I have a certain bite size that I'm comfortable with, and I came across an opportunity that was multiples larger than what I was comfortable with. I was pretty scared at the notion, but luckily, I had the wherewithal to take a step back, take a deep breath, and say pretty much any single thing you buy in your life that goes the right direction you wish was bigger and as big as possible. I thought to myself, okay, I get it, this is not how I drew it up, but I should be evaluating the quality of the opportunity. If the opportunity is there, I should be doing everything in my power to bridge the gap financially. I put up the majority of the money basically from my wife's and I's personal money. We put up the majority of the money for the mobile home park business. I didn't raise any money. I didn't send them a spreadsheet. A few friends of mine had said to me, hey, listen, I see what you're doing here. I'd love to be involved. I went to those people and said, hey, listen, you brought this up to me previously, so here's an opportunity. No pressure, but I'm coming to you because you came to me. If you want to basically put money in, I have a full-time job, I've never owned a mobile home park, and I don't have any fancy proformas for you and pretty much all these qualifiers why you should feel totally comfortable just passing on this. I've never managed parks before. We're inheriting a team that's lackluster at best to be able to build out a whole team. There's a whole laundry list of reasons why I could have failed and why someone should turn their back on this, but pretty much all of them are like, I'm in. That bridged the gap financially. These are all people I've known for 50-plus years.

Andrew: That was for the North Carolina portfolio, right? How many pads is that?

Craig: We're over 500 pads now. The first batch, that first portfolio was 270 pads.

Andrew: That's a bit [...]. Your first deal is over 270 pads? That's fantastic. How'd you find that deal?

Craig: It was 270 pads. It was actually around 400 total units because we ended up buying 270 pads, an office building, 22 single-family homes, and 79 apartments. There was a whole hodgepodge of stuff. Again, the same thing, when we started getting deeper into what this gentleman was looking to do, it was obviously a scary thought. There was literally an office building. I was like, it's the last thing on earth I want to buy, but it was a matter of am I being compensated for the risk I'm taking? I got myself comfortable with the risks based on the overall price I was paying.

Andrew: How did you find that first deal? The hardest part for most operators is finding a solid deal that pencils out, especially with all these apartments, single-family homes, and an office. How did you get comfortable with that?

Craig: I was introduced by a broker. A broker introduced me to the owner. It was a situation where the broker was very experienced, very mature, and very secure. He recognized—which I'm sure that you've come across many times—that everyone's different. This gentleman who's very much a mom-and-pop owner would never sell through a broker. In his mind, he was like, why would he pay the fees? He knew all about real estate, which is to each their own. Obviously, I don't believe that. If I was going to sell something, I would use a broker for sure. I appreciate the value of a highly skilled broker and what they could bring to me. I would definitely do that 10 out of 10 times. He felt differently. He felt like he knew better than anyone else what his real estate was worth and why, and he didn't want to pay anyone any fees for him to create that value or find a buyer. This broker introduced me to him and said, if this works out, we'll figure it out, which I'm just so appreciative of. I never owned a mobile home park before. He very much believed in the fact that I was going to follow through with what I said. We didn't have a 10-year relationship, me and the broker, I'd known him for a few months. We invested in a deal together, so that probably helped with my credibility and positioning, but he introduced us and this gentleman. We established a relationship over months. I flew in and saw him during COVID, and I flew another time. Honestly, I think this is a super important piece of this and for anyone else that's going through this process. This was a gentleman that I still keep in touch with and am still very friendly with. He's a very proud man. He came from nothing and built a $10 million-plus business which is extraordinary. He was very much the master of his domain, which I think a lot of people are when they basically build a business with their bare hands right from the ground up. He told me as I got to know him—I was listening to what he was saying—cautionary tales of other people he had dealt with in real estate over the course of his life. Honestly, he just didn't want to be fucked around with.

Andrew: Craig, I think that's very common from buying from mom-and-pops. They want to give it to somebody that's going to be true and stick to their word, and then they also have that grandson approach as what I've seen. They want somebody to take care of the properties and they want to pass it along. That's very important for mom-and-pops, making them feel comfortable. It seems like that's what you did. You really built the relationship. It was more than the transaction. Is that what you're getting at?

Craig: Yeah. Of course, everyone's different. There are some, let's say, baby boomer types of owners to be dealt with as well. It was super important to them what was going to happen to the park and we made them feel comfortable about that. This gentleman was a little less worried about that, but I'd say that he wanted to be treated like the master of his domain. He didn't want me coming in there trying to pull fast on him. I did every single thing I said I was going to do. I didn't retrade one penny, come back to him for allowances, or tried to change the rules on him. I feel pretty confident in saying that if I did that, the deal wouldn't have gotten done.

Andrew: Because we're getting off-track, let's circle back here. What do you think is the toughest hurdle to overcome in mobile home park investing?

Craig: As an operator, I think the operations are the toughest part by far. I'm not sure if you're asking that question from an investor's perspective, but from an operator's perspective, absolutely as the portfolio grows, it's keeping your tenants happy day to day.

Andrew: You said you're vertically integrated. You guys have your own management company, is that right?

Craig: That's right. We have our own property management company.

Andrew: What does that look like? How many team members and all that?

Craig: We have, I would say, 13 team members now. I have a partner on the ground, who I think you spoke with, Kevin Murray. He's my partner. He runs the business. He's outstanding. I can't say this enough. For those of you who are considering going on this path on your own, find a partner like Kevin. Kevin makes the world go round. Even in building the team alongside Kevin or under Kevin, he drives the whole mindset, attitude, and culture of the business and what's made it successful. There are some folks on the team like the guys on the maintenance team, people who work in the office, and people that run sales and leasing. The time that Kevin has spent developing those people into great teammates makes all the difference. I think we're in a great place now, but for me, it took a tremendous amount of time, love, and effort on Kevin's part to groom all the people on the team and really sell this vision, culture, family, and what we're trying to build long term.

Andrew: That's super important. I was listening to a podcast this weekend actually. It was a multi-family operator that got into mobile home parks. He was drinking Kool-Aid, bought nine parks all across the country from Eastern to Western to down in the south, and then realized how tough operations were. They tried to use a third-party manager, but that didn't work. They brought it in-house and realized they weren't good at management because they own over $1 billion in apartments. They brought it in-house to manage parks, and then they found an apartment management company that they were going to have manage it. They gave it to them, but they still were messing it up. Mobile home park management is not the same as any other asset class. There are so many moving parts. What can you tell us about building your management company and maybe some mistakes that you guys have made?

Craig: I could go on for hours about mistakes we've made, all of which have made me more grateful that we're vertically integrated because it's not easy. By the way, anything that's worthwhile is not easy. I would say that some of the mistakes that we have made—some are very specific to mobile home park owners—are underestimating the difference between park-owned homes and an apartment. For example, underestimating the costs, time, and effort to turn one over. The huge variance between an apartment and a mobile home that's beat to hell is a huge difference. Never having experience, just understanding the difference in floors, and the fact that mobile homes can literally have holes right down the grass, you have to solve for that. I love this, but you have to be a little bit deranged to love this stuff. We have over 250 park-owned homes. These mistakes [...] park-owned home, and I learned this. We learned this through a huge fleet of park-owned homes.

Andrew: Is it part of your model that you rent some of the homes out or do you guys try to convert them to tenant-owned homes?

Craig: We do both. I would say just listening to podcasts is interesting. A lot of people are like, no park-owned homes, don't like park-owned homes, and basically, you want to steer clear of them. We understand exactly. That's where we want to end up, but I also think there's a tremendous value in park-owned homes. I think they're basically undervalued in a lot of spots, and we've found that and we've been able to monetize that. What I mean by that is just like everything else during COVID and this inflationary period, the prices of used cars have gone up. We've seen things in our market. Our market is in Winston-Salem, MSA. We have a lot of parks that are basically almost equidistant from Charlotte in Winston-Salem. Let's say a generic 1993, three-bed, two-bath. I think a lot of people two years ago would have quoted that as $8,000 or $10,000, and we're selling some at over $25,000 in a lot of spots.

Andrew: Cash?

Craig: No, rent-to-own. Some cash but a very small percentage.

Andrew: For rent-to-owns, what's your annual turnover rate on those?

Craig: We've seen very little on the rent-to-own. That being said, we've only been doing this for 15 months. I'll check that again a year from now and we'll see. When you look at us as well, we ended up buying a portfolio of a variety of assets—stick-built homes, double wides on brick, used mobile homes, whatever. What we saw in the market occur—which I'm sure everyone's seen across America—are these inflationary trends. These stick-built homes we bought were honestly not that nice. They were selling at these wild prices. When you start looking at a used park-owned home for $20,000, $22,000, or $25,000, the disparity gap between the stick-built home and the used homes widens so, so much that we saw a huge demand for these used park-owned homes that I think that a lot of people would have quoted for $8000 or $10,000. We were selling them for $20,000-plus.

Andrew: From my experience with park-owned homes, you can sell them. Every market is a little bit different. I know Chris Rood. He's all about the park-owned homes, renting them out for $1500 a month, and getting that cash flow. There are a ton of ways to make money inside of the niche, but you could sell them for whatever price you want if the monthly payment suits them. You can sell them for $25,000 if the monthly payment is $400 a month. That's not the problem, but the thing is getting that pride of ownership from my perspective has been the struggle. We sell the home, and then 1 ½ year in, something breaks and they don't want to spend $500 or $600 to replace it. They're just going to abandon the home and leave, and then we got to have that turnover cost. That's been the struggle for us, so where we could have got $25,000, we sell it to them for $8000 or $10,000 because then they become an owner faster, and they're willing to spend the money on a new furnace if the furnace goes out. That's just my perspective. I know there are a ton of ways to make money, but our struggle with park-owned homes is that there's a 50% turnover rate annually.

Craig: That's high. I would be remiss if I spoke as though we had this figured out because we don't.

Andrew: I'm learning stuff too. My parks are more in the Midwest where Winston-Salem, obviously, is a really good market. That's fantastic, but if you can get the bigger down payment, how much do you get on the rent-to-own for a downpayment on one of those?

Craig: Let's say on a $20,000 home, we don't take any less than $2000. That being said, we sold a few cash. We've sold a lot between, let's say, $2000 and $5000. We use 20% first on a lot of sales.

Andrew: Nice. What a great program, by the way. The 20% first is wonderful.

Craig: It's a great program. Kevin does such a great job. Kevin and I basically want to constantly be learning in upgrading our business. Even on this front, this alone is selling used homes. We have tons of park-owned homes. What we want is to continually be adding arrows to our quiver. As much as we love 20% first, there are, let's say, segments of the buyer market that don't serve as well. How can we solve that? Zippy is a company that we are now really digging in with and trying to understand their programming and how that can fit into our business. It's a constant work in progress.

Andrew: Yeah, just learning new stuff. Tell me this. You bought your first park in June 2021, right?

Craig: Yes.

Andrew: Now, you're up over 500 pads. Has your investing strategy changed at all from when you first bought that portfolio to now? Do you look back and say, okay, we're no longer buying parks with private utilities, or hey, we're going to go with the park-owned home route instead of the tenant-owned home route? Has anything changed, and why?

Craig: Yes. My change of view has to do with the market. The market has changed in that short period of time. We closed on our first park about 15 months ago, so prices are much higher and lending costs are much higher. What's changed for us and what we've done is our strategy has been to target this very specific geographic area so we can build our core team there and then service all of our properties. We're not trying to speak to owners in the Midwest, not because I don't love the Midwest and not because I wouldn't invest myself with some other operator that I trust and believe in like you, but for our specific business, we think one of our advantages and core competencies is building out a team that is going to service and operate our parks better than the competition. I wouldn't say we're there now, but that's our goal. That's who we want to be. We want to be the best operator in the entire region, state, or whatever that is. We wanted to be very, very clear and stand out that when someone leaves one of our properties, they don't want to leave and they're basically telling their friends to come to move in. As we still target that area, I would love to buy basically any park that's in our geographic target zone. The only thing that's changed for me is how we approach that from a financing perspective. We closed on a 33-pad park. We closed on it maybe three weeks ago seller financing, so we're trying to educate ourselves and I'm spending a ton of time listening to Pace Morby and all these guys that really have a focus on seller financing. There's a great book out there—I'm drawing a blank now—by Bill Ham. It's all about creative financing. We are long-term believers in manufactured housing. We want to own these things for decades, so we're always going to be buyers. It's just a matter of how we make the numbers work for us. By paying yesterday's prices with today's interest rates, it's much harder to make it pencil out. I'm sure you're seeing deals all the time as am I. When it comes across your desk, you say, wow, this park looks great. At this price at 6%, this just doesn't work. If I had unlimited capital and I could buy it for cash, spend the time, and whatever, I'm sure that I will be pursuing more of these opportunities. That's not my situation. Again, in the majority, this is my personal capital, so my considerations are different than private equity firms or people whose cost of capital is 3% or something. We're just trying to be the best real estate problem solvers that we can be. In this environment, to me, that means having more levers to pull on the financing side and understanding creative financing better.

Andrew: Creative Cash is the name of that book.

Craig: That's the one.

Andrew: That's awesome. I've noticed that the same amount of work goes into a 33-pad park and a 75-lot park. You've bought a huge portfolio with 270 pads. What's the idea there? You mentioned scalability and how important that is. What's the idea with buying smaller parks? Are you getting better deals there? What's the thought process behind that?

Craig: It's interesting, and I thought about this a lot. I wish I could say we're sitting here cracking the strategy. A lot of these things are just how the ball bounces. We were fortunate enough to meet this owner and build rapport with him. He had enough assets in one place for us to establish a beachhead. Then, we built off of that. How did we build off of that? We had enough revenue from this original portfolio to start building out a team. Again, the most important thing that our business ever did was basically have enough money to invest in Kevin. Kevin is my partner. He was able to leave his full-time job and dive headfirst into this. That's the best thing we ever did. These small parks, why we are buying those is because we have enough of a nucleus in this one geographic location that now, if we can go after a 21-pad park, a 36-pad park, or a 73-pad park which are all real-life examples, Kevin was able to go to them and say, hi, Mrs. Smith. We are in town. The name of our company is 40 Oaks. We have bought this portfolio from this gentleman. This is what we're trying to do here. This is the vision for our business. If you want to sell your park, we're the best buyer for you. We even have a list of references of other local owners that we can give you. If you want to call them and ask them, they'll attest to the fact that we are going to basically make this as easy as possible on you. We have been able to get excellent deals on these smaller parks.

Andrew: It helps having them close by when they're all right there. That's also with the park-owned homes. You probably have one rehab crew that works for you, goes to all your homes, and does the same model. That definitely makes more sense if you got a cluster in the same area.

Craig: If you told me that you have one park, hey, Craig, there's a deal that's 4 hours away, it's a 50-pad park with 40 park-owned homes, I wouldn't be interested. If you told me that was in our geographical area, almost undoubtedly, I'd be the best buyer for that. Again, it has to do with where our talent pool is. Our talent pool is in this area, Davidson County, outside Winston-Salem, so I feel very comfortable we can execute well on anything 20 pads and greater and the fact that institutional players are not going to the 20–55-pad parks. No one is going after those the way that we are in that geographic area.

Andrew: That's another good point right there, less competition. You're going after these and you're finding yields. It's just not efficient for private equity to go down that low. Tell me this, what are the most important things passive investors—we're talking LPS here—need to know and look out for when investing in mobile home parks based on your time in the space?

Craig: I'd say that from a high level, the two biggest things are the market and whatever you want to call the operator, sponsor, or syndicate. In this example, you're right. There's a show on CNBC. Jim Cramer is a famous stockpicker. He has a line that he says all the time: there's always a bull market somewhere. Despite all the headwinds that we're facing in the industry, in the world, and whatnot now, there are cities, counties, and states all over America that are creating their own bull markets and are basically doing things like creating new jobs and making moves that are attracting people to where they live. They're creating their own personal tailwinds in these specific markets. That counts for a ton, especially when you start getting to market. It's maybe going sideways, maybe going down. Having that wind at your back in these different microenvironments is a huge, huge deal. I'm sure that there are a lot of people who—as the market was just on fire for years and years—started picking up different tertiary markets and even maybe beyond that and said, hey, it's a rising tide forever. It's not the case. I think that especially in a market now, making sure that you are in solid markets for the long term. I read some stat on Charlotte. It says they expect Mecklenburg County to double in the next 10 years. Having that wind at your back is a huge deal. Secondly is the operator. In this example, you, the person you're investing in, are very much investing in the words they're saying and what they're saying that they're going to do. Are they going to stand by that? Are they going to communicate well? Do they have credibility? Are they going to follow through with everything you're saying? Those are the two main elements. Then, if you start drilling down on the operator, in this example, you investing in your fund, I think you really have to think about what is the Keel Team? What is their success predicated upon? Is it predicated upon rental rates in Charlotte going up 20% a year for the next seven years? If that's the case, unfortunately, that's out of your control. Are Andrew and his team's success predicated on things that are in your control? The operations and things like that. Do you have a huge capex program? If that's the case, is that something you're experienced in? Can you execute what you are selling? Again, it's a huge piece of it. You're really investing in a leader of any team and believing in them. The funds are opportunities I've invested in away from my own. I've had basically pretty much blind faith in the operator I'm investing in.

Andrew: Yeah. The jockey matters most, right? That's great feedback. The market and operator, I love that. What's been a recurring theme is the operator and their track record. I have a quick question for you. Your day job is your fintech. That's where you're at. What have you learned or what have you brought from that into your manufactured housing business, portfolio, and management company?

Craig: Broadly, you're learning different things from different experiences. Before I was in fintech, I was a fixed-income trader. I see that in my decision-making constantly in the manufactured housing business because I was basically making decisions on the fly constantly all day long. People talk about business analysis paralysis. I don't suffer from that because I overcame that. I had it at some point. In that job, I had to overcome that quickly. Part of the job was making risk decisions on the fly constantly throughout the day. When I look at my W-2 career, the biggest takeaway is the risk-taking piece. I'm actually reading Sam Zell's book right now. He talks a ton in the book about evaluating risk, basically wanting the deck stacked in your favor, how are you evaluating risk, and how are you calculating the risks and rewards in different scenarios? I'm by no means an expert, and of course, I have a ton to learn, but I think that is the biggest takeaway from my W-2 experience. What I brought into manufactured housing is the ability to make decisions quickly, synthesize information, make decisions, and take well-calculated risks.

Andrew: I love that. That's awesome. How can listeners get a hold of you, Craig, if they'd like to do so?

Craig: My email is craig@40oaks.com.

Andrew: Awesome. I'm really thankful that you came on the show today. Thanks for coming in and dropping some golden nuggets. Craig: Thanks for having me.

Andrew: If you had one more tip for investors out there and what you could glean to our listeners on mobile home parks, what would that one final tip be?

Craig: I'm putting my money where my mouth is. My family has the majority of our net worth in manufactured housing. I'm a huge believer in that as an investment and then on a personal level. I know you only ask for one thing, but my second on a personal level is just to take action. It's so easy to make excuses. I have a 10-month-old. I have a pretty demanding job. I have all sorts of [...] going on as everyone does. Of course, you're going to make excuses and not do things, but if you want to get into manufactured housing, whether it's through properly vetting an operator like Andrew, doing it on your own, or whatever it may be, just start today. Even in the smallest ways like listening to Andrew's podcast is a great start. Just allow yourself to build momentum because there's never a perfect time, everyone's busy, and anyone can make excuses. Just start taking action.

Andrew: Awesome, Craig. Thanks again for coming on.

Craig: Thanks for having me.

Andrew: All right, that's it for today, folks. Thank you so much for tuning in.


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