Wholesaling an RV Park: A Deal Case Study w/ Emma & Kyle Greenwood

Mike DeHaan: [0:00] Alright, guys. Welcome to today's deal case study Friday focus episode here on the collecting keys real estate investing podcast. This is your first time to one of these episodes. On these episodes, we do a little deep dive into a deal that someone from our scale community has recently completed and sort of hear how they put the deal together and what exactly it looked like. And our whole goal of these episodes is to see what real real estate deals look like and not just the highlight reel that you hear on bigger pockets and all these other sort of places. Right? So Emma and Kyle, we are super excited to have you on the show today. And I think you're actually our first, like, couple guest I think we've ever had on the show. So you're gonna be we're gonna have a couple first on this one because your first couple guests are also our first deal deep dive that's been like something larger than a small residential property. So I guess we had somebody do a multi, but yours is is a little bit larger than that even till. So, guys, super excited to have you on the show. So on these episodes, we do we ask everyone these same three questions so we get a little bit of uniformity across the episodes. So first off, what kind of a deal was this? What was the asset type specifically?

Kyle Greenwood: [1:13] It was an RV park. The cozy RV park. Cozy RV park.

Mike DeHaan: [1:16] Yeah. And your exit strategy was?

Emma Greenwood: [1:19] We wholesaled it.

Mike DeHaan: [1:20] Wholesaled it. Wholesaled an RV park, and you just made all these people that think that they wanna accumulate assets shutter in horror when you had an RV park in your grips and you decided to walk away from it and make some money instead. But there's good reason for that. And second question, what was this seller? How'd you find this and what exactly was the demographic of the seller?

Kyle Greenwood: [1:40] This was an RV park owned by a couple for they owned about thirty years.

Mike DeHaan: [1:46] Yes.

Kyle Greenwood: [1:46] And we wrote them a handwritten letter one time and they called and we met the wife at Starbucks. Perfect. Easy enough.

Emma Greenwood: [1:55] They were older. They were like probably in their seventies.

Mike DeHaan: [1:59] Sweet. So burned out older landlord, simple direct mail. It's about as basic as it gets. Nothing fancy. No AI. Just texting machines or whatever people do try to use these days. Just standard letter to the most basic list, which is the absentee owners, which is awesome. Alright, so let's get the full story on this deal. What the initial negotiation look like, what the due diligence you went through with, I know that was extensive, what the ultimate exit looked like, and I know you did quite well. So let's start from the beginning. How did the initial conversation go?

Emma Greenwood: [2:31] Yeah. Actually, it was Kyle's idea. He wanted to reach out to some more niche lists, and so we went to the title company and had them pull lists for RV parks and mobile home parks in the area.

Mike DeHaan: [2:42] Nice.

Emma Greenwood: [2:42] I had the brilliant idea of handwriting the letters, and Kyle got to execute that, which he just loved.

Mike DeHaan: [2:48] Hey. You're you're delegating. That's like scale one zero one right there.

Kyle Greenwood: [2:52] We always have ideas for each other.

Emma Greenwood: [2:53] Yeah. So we hand there was maybe about 30 of them. And probably two months later, I just got a text from someone and she just said, planning on selling the Cozy RV Park this spring. I'll get back to you. Something kind of vague. And, yeah, I just scheduled an appointment. Like Kyle said, we met at Starbucks. We just chatted for a while about the RV park. So they actually did live on-site in a single wide, an older single wide. The RV park had about 10 spots, so it was quite small. And, yeah, they were burnt out. They wanted to move. So she told us a price, which was $500,000, and we actually thought that was reasonable. And we kinda just started doing some due diligence because we had never analyzed an RV park before. So

Mike DeHaan: [3:45] Yeah. Yeah. Did you contract that that 500,000 before you did due diligence or did you try to do the due diligence first?

Kyle Greenwood: [3:51] Before we agreed to that price?

Mike DeHaan: [3:52] Yeah. So they gave you the price where you're like, yeah. We agreed to that. You get it signed around so that she doesn't go and shop it to other people.

Kyle Greenwood: [3:58] Yeah. We did. And that was like a huge thing where I was like, I'm not gonna write you an offer and then wait a week. Yeah. I was like, if I'm bringing back an offer, I want you to sign it. And he was a good old boy. We shook hands. He loved us. My dad used to race some snowmobiles. Jack used to race snowmobiles. And we just kinda, like, bonded on some stuff. And we brought back a six pack of Coronas and had a beer with him, and then he said, give me the evening and I'll sign it tomorrow. Nice. Which they did. And we did our due diligence, like, around the car ride to Emma's office, just, like, crunching quick numbers, like, pretty sure we can make this work.

Mike DeHaan: [4:32] Yeah. So how did you even know how to start? Right? Because I know it's one of the biggest questions that we get asked a lot when you get a lead that is atypical from residential real estate, which is very sort of bread and butter. Right? So you were doing due diligence in the car, or you would you just like put on like a YouTube video of like how to analyze RV parks and you guys were like listening to that when you were driving or what were you doing?

Kyle Greenwood: [4:54] Listen to a couple of those before we looked at it.

Emma Greenwood: [4:57] Yeah. Definitely some videos. I mean, obviously, first, just like, right, adding up rents, like, very simple, like, what's the income? They said that they basically didn't have any expenses, which, of course, that's not true. So we're trying to look up what are typical expenses of an RV park. But, yeah, very basic from the beginning. Like, we were like using chat GPT to try to analyze this deal.

Kyle Greenwood: [5:18] Yeah. Yeah. We did I met a guy up at Schweitzer that buys RV parks, like huge ones, like four season, like multimillion dollar resorts. And we were talking about RV parks. So I gave him a quick call, and he actually had coffee with us and gave us his 2¢. Nice. But It was a whole nother league like he was like in the hospitality resort and this was a month to month RV park in North Idaho.

Mike DeHaan: [5:46] That's full of probably permanent residents, I would guess.

Kyle Greenwood: [5:49] Yep. Yeah. So it was a little different. Like it was a little closer to like a multifamily almost, or like analyzing something like that than like a full on resort with staff and stuff like that.

Mike DeHaan: [6:01] Sure. Probably a lot of similarities to like a mobile home park. So I know that when when you originally sent it out, I mean, you sent it to us as well to look at. There was a lot concerns around the sanitation and the electricity and different things. Just like there would be with Malone Park as well. So that's great. So you contracted it, which is awesome. I love that you guys did that. Such a huge mistake I think people make is they have like kind of a verbal offer, but they're not comfortable in the close yet. So they wait to get under contract. And then just the way the universe works, what always happens is some other random person will call them and offer a number that is probably more than you're willing to pay. Just because like, why would that not happen? Right? That's just, I don't know, the way things always seem to go. So you have it under contract. What were your initial sort of like next steps once you started underwriting it? Where was your original intention to close on it? Was it to monetize it? And how do you start going through that process?

Emma Greenwood: [6:54] Yeah. Our initial plan was definitely to close on it. I think we kinda romanticized the idea of, like, running this RV park and moving out there and it would be so cute. And and then when I really thought about it, I was like, okay. What I really would be doing is managing people who live in an RV full time.

Kyle Greenwood: [7:09] That's not

Emma Greenwood: [7:10] that cute. Then we just decided, yeah, we wanted to wholesale it. It'd be a lot easier.

Kyle Greenwood: [7:17] I would say you and Dan influenced that. That was about the time we discovered collecting keys podcast and massive income over passive income, and we really took, like, a step back and looked at it from that lens, and I think that helped us decide our philosophy a little more on what we wanted to accomplish.

Mike DeHaan: [7:35] Yeah. And I do think that you made a a wise decision and ending up wholesaling it. And so when you first started to wholesale it, you were just looking at like a traditional assignment fee. Correct? Yeah. Yeah. So and then I know inside just having followed you through with this, that didn't work out. And for various reasons, rural price point, things like that. And so you ended up having to go back and renegotiate. So what was that process like?

Emma Greenwood: [8:01] Yeah. Basically, I was kind of managing dispo and talking to buyers, and I was getting the same feedback from every buyer, which was that they're having a hard time making the numbers work, you know, with their hard money loan or whatever. No one wanted to put obviously, $500,000 cash into this deal. So kinda every single person had asked me, will they sell or finance it? Will they sell or finance it? Originally, the answer had been no. But after I had enough buyers asking, yep. Just approached the sellers again, told them the challenges we were facing and said, you know, hey. Everyone's asking for this. Is it something you guys would reconsider? And they said they'd think about it, and they got back to me the next day with the terms that they would consider. And we shopped those out to some buyers and we actually ended up texting some people. It was late one night, we were actually sitting at the bar, I think, texting some people like, Hey, here's where we're at. And some guy who had come to see it that night, he was like, if those are the new terms, he was like, put me down. I want it.

Mike DeHaan: [9:00] Nice. That's awesome. And so what what were those terms that you're negotiating? Because they were from the seller. Right? You didn't have to, like they seem like they're relatively savvy, so they knew what they wanted.

Emma Greenwood: [9:10] Yeah. I basically just asked them, you know, what would you guys need for a down payment, and what would you need for monthly payments? And they said they needed a $150,000 down, and they wanted $2,000 a month. And even though that was quite a big down payment, we just happened to have a buyer who was willing to pay that. And then, yeah, we tacked our assignment fee onto that down payment.

Mike DeHaan: [9:32] Yeah. I didn't realize that they had that big of a down payment on that deal. Yeah. So when would you guys end up adding on as assignment fee?

Emma Greenwood: [9:41] 50 k. So they brought 200,000 down.

Mike DeHaan: [9:43] Yeah. That's awesome. This is such a great deal too because you found someone that had $200,000 to bring to this at a favorable terms for that person. But you had to hustle to find that. And I don't wanna understate how awesome it is that you guys did that because the most common tactic that people have is they kinda like send it out to a list. And if they don't get any, like, super hard bites at like a relatively simple deal, they just go, oh, it's dead. And then they drop it. But you guys are out there hitting the pavement and you found this person like who even was this person that has 200 k to put into this? You know, to get their name, but like what what kind of person was this

Kyle Greenwood: [10:21] willing to do that job? For buyers? Yeah. Right.

Emma Greenwood: [10:25] No. He was a local electrician. He owned an electrician business with his dad. Well, I don't know how to yeah. But he was an investor. He had a couple single family rentals and then, I don't know, he just he was really had money ready to go.

Mike DeHaan: [10:39] Man, just

Kyle Greenwood: [10:40] He makes massive income in it with his electrician business, and he's buying real estate with I

Mike DeHaan: [10:45] mean, that's the way to do it though. Right? Like, honestly, is so many people that are out there that are quote unquote real estate tycoons. I mean, they didn't make their money from a w two job. They had another business, whether that's in real estate or not, and they use it to invest after the fact. Yeah. No. That's awesome. And then as you went through, is there any other, like, due diligence or anything, or he was just happy to go with those terms?

Emma Greenwood: [11:06] Due diligence was pretty minimal. He did go out there and the seller showed him the septic system, which was it was a large septic system, obviously, for an RV park and but it was really quite minimal on his end.

Mike DeHaan: [11:20] Nice.

Emma Greenwood: [11:20] So made it pretty easy for us.

Mike DeHaan: [11:23] Easy done. And obviously, I guess too going back to when you went and renegotiated the seller finance situation, you said that people that you're talking, that was what they wanted. So you were open to them about the fact that you were wholesaling and you're finding another buyer.

Kyle Greenwood: [11:36] Yeah. They knew we were someone else was buying it, and they even asked Emma. So all the dispo credit goes to Emma. She worked with the buyers and the sellers. And there were the sellers asked her if she was, like, needed money for it. She was like, no. I'm I'm gonna make money on it, and they knew about it. Nice. They actually are using Emma as their their buyer's agent to shop for a new house right now. That's awesome.

Mike DeHaan: [11:58] See Yeah. So many, like, just bad sort of, honestly, rumors or things like that around wholesaling, you just completely obliterated in this, you are transparent with the seller about your intentions, they know you made money, you provided them a good enough service, they want to give you more business, right? They got exactly what they wanted the buyer super stoked. And yet all of us wholesalers have a bad reputation. But it sounds like every single person is happy with how this ended. And you guys made a very, very healthy fee.

Kyle Greenwood: [12:28] So Yeah. Yeah. And we you know, it was an assignment. It wasn't like a double close. So the electrician, he was happy that we made money, and he was like, I'm a start saving and find me another one.

Mike DeHaan: [12:39] Nice. That's awesome, guys. Yeah. Congratulations. That's such a such a great deal. And so you got that $50,000 to kind of seed fund you guys really leaning into growing your business. What have

Kyle Greenwood: [12:50] you put that towards so far? We've upped our marketing and we are now gonna close on the first on this. We're calling it a compound. It has four houses and a mobile home. Yeah. So we're putting some of that towards a partnership of splitting those lots and selling them individually.

Mike DeHaan: [13:07] Nice. And you're gonna multiply that money very, very quickly doing that.

Kyle Greenwood: [13:10] Yeah. Yeah.

Emma Greenwood: [13:11] It doesn't really feel like we made $50 because we're just it's already spent in my head all on our business.

Kyle Greenwood: [13:18] Yeah. Well, also we had like no money going Like into no money. Yeah. And so we needed to get this done.

Mike DeHaan: [13:26] Mhmm.

Kyle Greenwood: [13:27] And we hustled to get done. And so a lot of that money was kinda set aside in our own like personal reserve account and just to like be able to afford to live and to continue marketing.

Mike DeHaan: [13:40] Yeah. There you go. And it's funny. Emma, you say that you spent this money already in your business, you invested it in your business. Thank you. And instead of ending up with an RV park that was going to become like a weird trailer park boys type of job, You're instead investing this into the next deal that you sourced where you're gonna be separating these lots that you're gonna make, eventually, hundreds of thousands of dollars on. So we'll see how it pans out over the next couple of months, but it could have been you had a, basically, a reality TV show or

Emma Greenwood: [14:10] something. Missed opportunity. To be

Mike DeHaan: [14:14] fair, if you turned it into a YouTube channel, you could have probably made more money just living your day to day life. But

Emma Greenwood: [14:19] Get to know these tenants. Yeah. Yeah.

Mike DeHaan: [14:23] I will personally say that I think you guys made the right decision, and you're going to be very, very happy that you chose to do that as we look forward to the next few months.

Emma Greenwood: [14:30] Yeah. Well, good to get it done.

Kyle Greenwood: [14:32] So Sweet. Thanks, man. That's good to hear. Absolutely.

Mike DeHaan: [14:34] Well, guys, congratulations on success. That's a really, really solid deal. And everybody listening, these are the kind of things that you can do if you start sourcing your own opportunities, and you just get out there and start hustling. Because you guys, I will say I'm I'm super, super stoked to have you guys in the scale community. And you guys are one of those people that I can already tell that, I mean, even already, but, like, looking ahead a few months from now, you're gonna be one of those people that I will selfishly be like, hell, yeah. I gotta see them go through their initial climb and get to that phase where they are now absolutely crushing it up here in the Northwest. So super excited to see all I am out. Awesome, guys. Well, thanks for listening. If you guys have socials or anything, people can reach out to you and maybe ask some questions.

Emma Greenwood: [15:16] Sure. You can reach out to me on Instagram at the Emma Greenwood.

Kyle Greenwood: [15:20] Yeah. You can reach out to me via loose underscore tribe at loose underscore tribe on Instagram.

Mike DeHaan: [15:29] I'm not even gonna ask what that's like a, you know, alluding to, but I'll just I'll just keep it to myself.

Kyle Greenwood: [15:36] Just go on there, click follow, and you'll see. There you go.

Mike DeHaan: [15:41] There you go, guys. Well, thanks for listening everybody. Go ahead and shoot them a follow on Instagram, and you will be able to see say that you followed Emma Greenwood and mister Luce Tribe himself before they became mega in the off market real estate space. So go ahead and give them a follow, and reach out to them if you have any questions or you admire what they did because you definitely should because they're out there crushing it. So thanks for listening everybody, and we'll talk to you guys next week.