On this episode of The Mobile Home Park Lawyer, Ferd talks to Frank Sciara, a mortgage loan originator. Frank gives amazing insight into mobile home park financing and offers some great advice on how to secure a loan. Frank also speaks about some of his predictions in the market and what he sees happening down the road.
0:00 – Intro and Frank’s background
2:19 – Frank deals in medium to large range loans, with a minimum of $1 million
2:56 – Ferd asks what Frank sees with MHP at the moment, in terms of interest rates and some projections
5:19 – Frank believes there’s still some room with cap rates at the moment
7:29 – Frank offers some definitions and differences in some of the language he encounters in his work
11:53 – Ferd asks what the borrower requirements are to be eligible to sign on a non-recourse loan
13:42 – Ferd talks about his experience with a Fannie Mae refinance, and Frank talks about how the process works with Frannie Mae and Freddie Mac
21:22 – Most yield maintenance calculations have a minimum of 1%, Frank has seen it as high as 20%
23:29 – Frank talks about Fannie Mae’s supplemental program
24:33 – Frank always asks what their clients’ goals are with the property
25:17 – Ferd asks what happens when you hit the end of your term
26:41 – Ferd asks for some tips or general strategy for people looking to secure loans
29:46 – Just because a park isn’t a three-star, doesn’t mean it’s not financeable
FIND | FRANK SCIARA:
Ferd Niemann: Welcome back mobile home park nation. Ferd Niemann here again today with another episode of the mobile home park lawyer podcast. My guest today, he’s a friend of mine who sat on the same board together for Kansas City’s DCIM chapter. He knows all kinds of stuff about real estate, he’s a mortgage loan originator, he works at Grandbridge Real Estate Capital. Please help me welcome Frank Sciara. Frank, welcome to the show.
Frank Sciara: Thanks Ferd, appreciate it. Happy to be here and talk about mobile home parks and anything with you today. How have you been?
Ferd Niemann: I’m doing well, man, stand dry rainy day here in Kansas City, as you know, but well, Frank, I know a lot about you. For some of our audience that may not, tell us more about your background and what you do now. Obviously, also, I know something that you bring to the table that a lot of other lenders don’t is you’re kind of interdisciplinary in the sense that you work on more than just mobile home parks. You do multifamily other stuff. So give our audiences a bit more about your background. We can jump into some specifics.
Frank Sciara: Sure. Happy to. So I’m with Grandbridge Real Estate Capital, I’ve been with them for 16 years now. High level, we’re one of the largest commercial mortgage banking firms in the country that specialize in providing long-term, fixed-rate, non-recourse financing for all multi-family and commercial property types. So I’m a generalist to work on a lot of different property types, including mobile home parks. Work with multiple capital sources as well, including Fannie Mae, Freddie Mac, HUD, work with probably 50 different life insurance companies. We work with wall street firms to help that securitize loans. So probably a hundred different capital sources all in, so have a lot of different buckets of money, so to speak that we can help place loans depending on the situation and the property, and maybe what somebody is trying to do with it.
Ferd Niemann: Got it and I know from talking to the past, and typically you’re at, you know, I say medium, larger loans. You’re not going to deal with the $300,000 loan, you’re dealing minimum, a million, but oftentimes you’re into 5, 10, $20 million range.
Frank Sciara: Yeah, that’s right. Our minimum is typically a million dollars. Our sweet spot is probably in that. I’d call it, you know, 5 to 20. But there’s really no maximum. We work with some capital sources that we’ve taken down some really large portfolios over the years, that’ll be, you know, a hundred-plus million. So again with the number of capital sources we work with, we can cover different loan sizes.
Ferd Niemann: No, that’s great. Well, what are you seeing in today’s market Frank on MHP in particular? And I know there’s a lot going on kind of macroeconomic with, you know, stimulus bonds and, you know, funding money out there everywhere. What’s it going to cost, materials are up through the roof. I’m really worried about the dollar being devalued more and more and more by the day. What are you seeing from an interest rate and what are some of your projections? And we’d kind of go back and forth on some of these things, just interested in your opinion because you do touch so many different asset classes, so many portions of the country.
Frank Sciara: You know, it’s a great question. It seems like there is more capital chasing deals than there’s actually deals in the marketplace right now. With heavy focus lenders or investors are really chasing multi-family and industrial. It seems like that’s where there’s a heavy focus. So we’ve continued to see cap rates compress even through the pandemic, values continue to go up, to your point with lumber costs and other material cost up, that’s obviously making it more challenging to do new developments, which is also, I think, contributing to some of the increases in value and some existing properties that are out there, and mobile home parks have, they’ve benefited from that as well. It seems like there’s more investors today than there were 5 and 10 years ago that we’re looking at those property types. So there’s just a lot of capital out there chasing deals right now.
Ferd Niemann: No, I think you’re definitely right. That there’s more people in the marketplace for mobile home parks than 10 years, but five years ago, three weeks ago. I mean, it’s just, it’s just every day I hear new people jumping in. Where do you think cap rates are going to go? For multifamily and for mobile home parks seemingly they’re continuing to go down. Is there a floor? I mean, obviously, there’s always, I always thought there should be a spread of the cap rate should be at least 200 basis points, ideally 300 basis points or more higher than the interest rates. And it seems like the compression is in all these asset classes, rates are pretty flat. They went up for a minute and kind of stay up down a little bit, but cap rates are going lower and lower. So it’s like, I get the supply and demand of people chasing deals, but I’m just curious what your opinion is. Are we going to see a forecast to be the norm? Are they going to go to three? I know some portfolios, some of the coastal markets may already be there, Kansas City they’re not there. Where do you think if they go one to five years from now?
Frank Sciara: Yeah. It’s, you know, it’s a great question they’ve already, I mean, you look at just in the last 24 months how much they’ve compressed. There’s just so much money chasing these deals on the coast. We’ve already seen cap rates up for, you know, they’re in the threes already. And now that money continues to come to the Midwest and just keeps driving values up and cap rates. It seems like there should be some type of spread. But if people are worried about, you know, inflation or maybe they have other motives or whether they’re trying to get into a property, maybe it’s a 1031 exchange, it’s tax avoidance. There could be different reasons. But at least with the flow of capital right now and where you see where cap rates are on the coast, I think we still have a little bit of room here in our markets here in the Midwest. I think you can still see them go down a little bit more.
Ferd Niemann: Yeah, I think so too. I think Midwest in general, they’re getting lower and lower, but there is still some spread. Do you attribute, touching on inflation, do you attribute, you know they are also COVID hit, you know, there’s a sense of security and housing. People are going to undoubtedly need housing and they may not need another restaurant, another sporting store, things like that. And how much do you attribute this decrease in cap rates to wealth preservation? If you’re paying, a cap rate’s interest rate is 3%, but not a lot of cash flow. So are you just preserving the value of the dollar rather than have it sitting in cash equivalents? How much of it is that versus how much of it do you think is people that are bullish on the asset classes for NOI growth?
Frank Sciara: I think it’s more the former myself. I think it’s a hard asset. You know, people are concerned as a stock market. Is it overvalued? If you’re sitting on cash, that’s not earning you anything. I mean, there’s a lot of factors, but I think people still like to have a hard asset. People need a place to live. That’s not going to change. The population is still growing. So, you know, it feels like a safer bet. You know, you could hold it, you could ride it out longer-term if you know, we’re going to have volatility, you’re going to have ups and downs in the market. But I think a lot of people view it as just a safer place to park their money long-Term
Ferd Niemann: Got it, I would agree. Let’s talk about kind of the different offerings for agency conduit, life insurance lenders. Can you give us kind of what the general differences are, what the terms are? I mean, I know you speak this language all the time and you know what Freddie SBL means, the rest of us may not know and how we qualify for that. And then pros and cons is, I want to do the agency debt is like, yeah, I’ve got a park in Iowa that was, I’d love to get agency debt on it, but it’s only 20 pads. So minimum 50, right. And then there’s minimums of certain dollar value normally where we referenced a million. But if you could maybe just give us a quick summary of the distinctions between those, better to have them in our quiver for if and when we’re going to use them.
Frank Sciara: Sure. I’d probably break it up by buckets, one being agency, which, you know, Fannie Mae and Freddie Mac, which everyone’s aware of. And they’re probably doing the bulk of these. The second bucket would be life companies. These are the state farms, the Nationwide’s the world down to some small life insurance companies people probably have never heard of third bucket. I’d probably go with CMBS commercial mortgage-backed securities. These are the ones that are pooled together and packaged and sold off in trenches in wall street. People, again, if you’ve been in the market, you’re probably somewhat familiar with those as well, also active in the mobile home park space. And then finally the fourth bucket is kind of a mix of banks, debt funds, credit unions, kind of like you know, kind of a mixture of different capital sources that are out there. They’re all slightly different. High-Level, you know, Fannie Mae and Freddie Mac are typically going to be your highest leverage. Fannie Mae, for example, a little bit more aggressive in the mobile home park space. They can go down to a minimum loan amount of a million dollars on an acquisition, and they can go up to 80% of your purchase price, assuming there’s enough debt service coverage in place, typically a minimum like a one to five debt service coverage. Rates today, you know, it’s really a hard question to answer. There’s so many things that get factored in, leverage, loan size, debt service coverage. I’d have to give you a wide range. I’d probably say, you know, mid threes to low fours, maybe even up to the mid fours, pricing has been a little bit wider with the agencies today, but Fannie Mae is really probably doing a more of a bulk of the manufactured housing today. Freddie Mac also is in that space. They’re not as competitive in the smaller loan sizes as they have, what’s called their Freddy SBO, which stands for small balance loan program, which is very active on the multi-family side. Probably the most active, small balances defined as loans of 7.5 million or less, very active on the multi-family side. But Freddy SPL actually will not finance mobile home parks right now. Surprising, I think at some point in the future that’ll change. So if you go Freddie, you have to go through their conventional programs. So it’s probably more like a minimum of $5 million. So Fannie Mae really eats up the bulk of those smaller, anything below, you know, 1 million to 5 million on the mobile home park side. The next bucket I would move over to life companies. Typically the leverage isn’t going to be as high, they want to be more probably 65%, maybe 70% max leverage. They can be more flexible in their terms. They can also be more aggressive in their rates. I’d tell you today you know, a small $2 or $3 million loan call it 65% of purchase life companies could be, you know, in the low threes, low to mid threes on their rates. So more aggressive on the rate, but lower leverage. So that’s kind of the big trade-off you probably have between an agency execution and a life company execution, CMBS, third I’d probably put somewhere in the middle, leverage not quite as high as agency, but it will be higher than life company. And rates I’d say right now today, probably a little bit more aggressive on these smaller deals or comparable to what we’re seeing with agency. They’ll also do maybe some more challenging parks and we can get to that, like what lenders look for, but they might do some things that maybe won’t qualify for an agency execution. And then finally, you know, banks, credit unions, those other types of buckets of money, debt funds, more of a recourse type of lender. I’m going to look a little bit more at the strengths of the borrower. Little bit different than the first that are more permanent products.
Ferd Niemann: Thanks. Thank you. Appreciate that. I want to touch on that last item you just mentioned on strengthening borrowers. I know a lot of, I see people calling, they’ll call me sometimes, Hey, I want to do non-recourse deal, I don’t have any credit. And I can’t get told no for a car. They’ve been told no for a house, they’ve been told no for a local bank, but you and I know non-recourse doesn’t mean everybody can get approved. What are the borrower requirements from a criminal background or lack thereof, general net worth, general liquidity, or general experience standpoint? It’s necessary to check that box to be eligible to sign, sign on a non-recourse loan with one of these providers.
Frank Sciara: Yeah, No good question. It very slightly with each lender, I would say generally speaking lenders are looking for a combined net worth. So say you have two or three individuals that are coming together buy a property. They’ll look at a combined net worth. They’d like to see at least equal to or greater than the loan amount. And they like to see liquidity, combined liquidity, typically again, general rule of thumb, maybe 12 months of debt service combined between the owners.
Ferd Niemann: Okay. That’s good. So, I mean, as you get bigger and bigger on loans, it’s just do they continue to reevaluate, but you want to do a $5 million loan the next time, because at some point, man, you got to, 10, you got a 20, it seems like it becomes harder to keep pace with the acquisitions I would think.
Frank Sciara: Right, No good question. That’s probably, I should have clarified. That’s probably more in small balance loans as they get larger, you know, say somebody doing a $25 million loan. Maybe it’s a portfolio they’re probably going to back off the requirement for the net worth, but there will be still be a pretty good focus on liquidity. For sure. Yeah. So you’re right, because if you’re starting to get some larger loans that could be tough to qualify.
Ferd Niemann: Okay, good. That makes sense. I just went through one of these Fannie Mae refinances and the timing of it took longer than I would have liked. And then as such the interest rate and the marketplace went up you know, somewhat considerably relative to my, you know, quoted interest rate when I began the process and that, you know, I was not able to lock in the rate until all of the underwritings was done. And basically, we locked the rate in three days of foreclosing in a 90-day process. So for first 87 days, I was subject to interest rate risk. What was interesting to me was the lender, you know, felt bad about that. And they reduced their spread or their yield, which makes me wonder why didn’t they just do that all the time? You know, obviously, there’s profit in it for the lender and they didn’t charge any fees or points. Their profit isn’t spread. Can you explain to us how that pricing works and how you go about evaluating that for your clients? And, you know, if you’ve got five companies you want to make the loan, if I got a nice loan one, two, Three Main Street for five million bucks, presumably you can take it to a number of options and the difference that you just mentioned, like LTV interest rate, those are factors, but in the same bucket, there are numerous people you could take a loan through Fannie, through Fannies originators or explain to us that process, how you evaluate that and how those spreads work?
Frank Sciara: Yeah, I mean, the loan originated with Fannie Mae, underwriter ultimately sold off into the secondary market. It’s really, I mean, Fannie Mae and Freddie Mac are basically the two largest securitized lenders in the market. So that it’s a fluid market, it is changing. Those spreads, those investor spreads there’s multiple components to kind of makeup that spread, and Fannie and Freddie typically price as a spread over a benchmark, for example, the most common being a 10-year loan term. So they price as a spread over the 10 year US treasury. So you have a couple of moving parts there, obviously the treasury yield plus within the spread, there’s some components there that are again, changing on a daily basis with the market. Where you can see some differences, if we are, for example, able to underwrite to a higher debt service coverage that will improve your spread. If we are underwriting to a lower LTV that will also improve your spread. So that’s where you might see some variations, maybe from one lender to the next, depending on how aggressive somebody might be able to get with their underwriting. It’s kind of a fine line. We have to be aggressive, but also have to be able to deliver. And what we tell our borrower we can bring to the table. So that’s where you might see some variations slight variations from one lender to the next.
Ferd Niemann: No, that makes some sense. I mean, I know I was given the options. If you want to go 55 LTV, here’s your rate. 65, here’s your rate, 75 here is your rate. And then mobile home parks, there’s these additional tenant protections, tenant lease provisions that came out relatively recently. And then if you put those in your lease addendums, you got like six months plus post-closing to do it. Well, then default theory, then you get a lower rate. So those are, that makes sense.
Frank Sciara: It is a big discount. I mean, you can get up to 40, 45 basis point discount if you’re willing to do that. So it makes a lot of sense, especially if you think you’re going to hold it long-Term. That is for sure.
Ferd Niemann: Yeah, it really does. And then I looked there’s like eight or nine provisions and really, they were, I think all but one of them, I already had them, that’s not a big deal. It’s like, okay, basically like, don’t be a jerk landlord. Do proper notice before you increase rate, increase rent. Don’t, you know, don’t offer people a month-to-month lease where you can Jack the rent up every two months or something like that. Things of that sort, no that’s interesting, I’m glad you’re able to help us kind of unravel some of these terms. The other term that I hope you can enlighten us on a little bit is yield, is either a combination of yield maintenance or essentially prepayment penalties yield maintenance and or defeasance because I feel like these are complex kinds of everybody kind of knows what a prepayment penalty is, but how they calculate them and help painful is going to be depending on the time of your loan, I feel like borrowers, you probably see all the time that borrowers don’t recognize, I’m in the middle of the lawsuit to client now where the, my client’s buying the park and the seller finds out in closing, when he’s got to pay off his existing CMBS loan, that there’s a $300,000 prepayment. And he’s like, well, I’m not going to close this. It’s like, you have to close, you have to close the deal. And he said, no. So we’re sewing over specific performance to make sure he gets his butt to the closing table. But had he known about this big penalty that was in his loan docs, nobody seemed to read, he probably would not have signed the contract, he would have waited out the loan or he would’ve done something. And I’ve got several stories like that, that people are like, whoa, you mean what? So maybe give us a brief breakdown, and then maybe a hypothetical, you know, if I just got my new loan today and tomorrow, I’m going to sell the park to Frank. What does that look like from an assumption of the loan? What does it look like, from a payoff and or, and or am I stuck until my loan terms out at the year 10?
Frank Sciara: Yeah, no good questions. I would say most loans in the permanent market, Fannie Mae, Freddie Mac, life company, CMBS are assumable. So if it is a situation where you think you’re going to hold it long term, some things change, plans have changed all of a sudden, you’re two years into a 10-year loan yet you’re staring at a pretty big prepayment penalty, a loan assumption is probably in that scenario, the best way to go. You’d probably want to advise the buyer on the front end that you’re not selling it free and clear that they’re going to have to assume the existing debt, yield maintenance, it’s somewhat challenging to describe because there’s some variables involved. The two main variables, how much loan term remains on the existing loan. And then what is the corresponding treasury? So what I mean by that, let’s say you did an original 10 million, 10-year loan term. Let’s say you’re in year five now, somebody makes an offer you just can’t pass up. So you got five years left on your loan term. The lender will compare the two main variables and going to say, well, your interest rate, let’s just say was 5%. They’re going to say, well, now since you have five years left on your loan term, what is the five-year Treasury yield? Essentially, if they get paid off early and they want to turn around and immediately invest in treasuries to try to maintain the yield they were expecting, they invest in a five-year treasury. So say the five-year treasury is at a 3% yield. Well, there’s a 2% gap, there is two-point gap between the rate they were collecting and now where they can reinvest, very kind of summary as a net present value calculation, where they maintain that yield. And it covers that 2% gap. So the two biggest variables, what are the corresponding treasury of compared to your remaining loan term and then how much loan term is outstanding.
Ferd Niemann: That’s a great explanation for a complex concept, then I’ve seen those formulas in that exhibits, these loan docs, it’s a mess, but so to take it even further, it’s in my ten-year loan, I was on year nine and six months, I only had six months left and my original interest rate was 5%. And the current five-year treasury is 4.9%. It’s not going to be that painful because I’ve only got a little bit of time left to maintain and only a little bit of spread.
Frank Sciara: That is correct. I also, yeah, I would also add to most yield maintenance calculations, they have a minimum of a 1%, so there will never be a situation where the short-term rate might actually be above your rates where you’re going to pay off your loan. And the lender is going to write you a check. So there’s always a greater of yield maintenance or 1%, I bring that up because that question does come up sometimes, they think somebody thinks they might actually be able to collect money with an early payoff. I know that did happen in some situations in the past with swaps some banks were doing, they didn’t have a minimum and people were maybe collecting funds when they paid off a loan. But no, you will have the greater of yield maintenance or 1%, most lenders the last 90 to 120 days, it’s open at par and really with an agency loan, you get to that last six-month window, you’d probably go to a 1% prepayment penalty as well. So at that point, yeah, if you were going by the letter of the law, the yield maintenance calculation, it would be minimal. So you’d be hitting that 1% minimum at that point in time.
Ferd Niemann: Got it. How high would the percentage be just to be known roughly from looking at one, if it was that example you used the 2% spread instead of a year five. If I did it in year two and had eight years left, and we talking, is that equivalent to like a 5% penalty or how high does that go?
Frank Sciara: If you have eight years left, I mean, I’ve seen calculations if there’s a lot of loan term left and depending on the gap in the actual rate versus the corresponding to the treasury, I’ve seen 10, 15, 20 plus percent penalties. Yeah. So that’s why that, that right there is exactly why these loans have a loan assumption clause because you know, nobody would ever pay a 20% pre-payment penalty. But obviously, a buyer could step in and assume that loan and kind of move forward with it.
Ferd Niemann: Yeah. And the downside for the buyer though, is they’re kind of stuck with your interest rate and stuck with your leverage. So if I bought up to 5 million and sell them for Frank for 8 million, I got a 4 million dollar loan to assume Franks is going to get a $4 million loan or an $8 million dollar purchase, which means low LTV, unless you get what a supplemental or a second, how would you go about in that situation?
Frank Sciara: Fannie Mae has a supplemental program. That’s right, it’s basically secondary financing they’ll put behind their first. They say they can take it back up to the original LTV. Now there are, you know, some, depending on how much loan term is remaining there’s some stress tests and whatnot, a lot of times you might not get all the way back up to that remaining LTV. They also have a refinanced test that they have to run. So I always caution people when they start looking at supplemental. Sometimes it sounds a little bit better than it actually is once you get into the numbers, but yes, that is a way to bridge the gap a little bit in those situations. But yeah, if you know, if you have a property and you’re selling it and a buyer has to assume the loan that could limit the buyer pool a little bit, because you’re right, somebody might have to bring some more equity to the table in that situation.
Ferd Niemann: Right. That’s what I’ve loved that concern, the buyers had to bring more equity. You got to limit your buyer pool to already in the Fannie Freddie pipeline or provable. It limits your access badges. So if you’re planning on selling, you may want to reconsider the long term, maybe do something else.
Frank Sciara: You know, that’s one of the questions we always ask our clients when we talk to them upfront, like, you know, what is your goal with this property? And what are you ultimately trying to do with it? Is this something you’re going to keep in the family and pass down to your kids? Is it something you think you might sell in two or three years? We would never want to put a borrower into a long-term loan if they think they’re going to do something with the asset in two or three years. So it’s our job to maybe ask those questions and really understand what they’re trying to do with the property. And then we trying to go out and try to, with all of our capital sources, find what fits best with what they’re ultimately trying to accomplish.
Ferd Niemann: That’s good. That’s good to know. And good that you guys do that. Tell me, we finished our hypothetical here on this. I got my 10-year term, what happens at year 10? What does that process look like? I haven’t got through one. I think I know what happens. It’s just like a, you know, the balloon and all that. But I’m curious on how you explain it as far as what happens when your 10 comes, as far as, you know, essentially a refinance or changing terms or then when I sell, you know, what’s that look like?
Frank Sciara: Yeah. Good question. So, yeah, at the end of that loan maturity you either need to refinance or sell or pay off the loan. However, that might be, I guess it could be with cash or other proceeds you might have available. So we’ll typically advise our clients, you know, you can get started 6, 9, 12 months in advance. We’ll start sizing deals, start tracking it for them, start helping them monitor, help make sure that the numbers kind of tracking and trending and are going to show in the best light when we take it back out to refinance it. Most loans have that 90 to 120-day window at the end where there’s no penalty. So we can kind of time it up to, obviously, you’re paying it off in that window. But again, it doesn’t hurt to get started a little bit sooner rather than later on that. Just so you know bumping up against the clock.
Ferd Niemann: Makes sense. What other tips can you give us Frank for MHP borrowers or any other general strategy that you can give us to get approved and to maximize our value and maximizer our investments?
Frank Sciara: Yeah, no, it was a good question. I think lenders who will lend against mobile home parks, some other property types are looking for good quality properties. They’re looking for properties that are well located. They’re looking for properties with strong, stable, occupancy history, strong stable cashflow, good collections history. There’s been a huge focus on rent collections here, with COVID everyone was concerned with all the job losses what’s going to happen. Our tenants not going to be able to pay the rent. So having, you know, really strong collections, not having much bad debt these are things that are looked at all property types, obviously multifamily and mobile home parks. These are the types of things that lenders really look for. Quality of park, Fannie Mae will typically tell you they want to see a three-star park or above. Now that star rating system, you know, some people will tell you it’s not a great system. I would say more specifically, things are typically looking for paved roads and curves skirting designated parking, paved parking. Those are some of the things typically more double wides versus single wides. From a utility perspective, you know public utilities are favored. It doesn’t mean if you have private utilities, it can’t be financed. Doesn’t mean if you have a higher percentage of single wides versus doublewides, that it can’t be financed. We’re just going to have to do a little bit more digging, kind of explain, Hey, this is the market and this particular location. But again, high level, these are some of the general things. Most lenders will look for. Another one’s park-owned homes. For example, Fannie Mae, I think with their charter, they can go up to 35% of the owns can be park owned, but they will not give you any credit for the rent that is generated from those homes. So they were only focused on the pad rent. So we will have to carve out any income and expenses that might be associated with park-owned homes. But again, at the end of the day, like most property types lenders are looking for good properties. Well located good, strong stable cash flows.
Ferd Niemann: No makes sense. I’m with you, the star system is a little broken. I don’t think, I don’t even come to the final star systems. I’m just like, this, this, this, this, this, this, and I just did a refinance on a Fannie deal that I would have called it a two-star, it is got three double wide and 50 single wides. And they’re all 1970s. And it’s not that sexy, but the roads are nice. The homes are taken care of and you know, it’s a nice clean park, but it’s definitely not, I wouldn’t call it three or four, five stars, but it’s, you know, income’s good. Collections are good. Good infrastructure. And those seem to carry the day more than it’s not on a picture of a magazine. My lawnmowing bill is zero to give you an idea. There are zero commoners. There’s one playground that had mulch under it. And that’s it.
Frank Sciara: Well, and just because something, not a three-star doesn’t mean it’s not financeable. I mean, if you have an older park, doesn’t have the star rating. If it has a good, strong, stable occupancy history and a cash flow that we can look to, that it might not qualify for Fannie Mae or Freddie Mac. But CMBS might look at it. One of our other lenders might look at it as well. So there’s other options out there. If you have a good stable history, I think that’s more important.
Ferd Niemann: No, I think I agree. I know collections are a big deal right now industry-Wide and I know that agencies are definitely looking at it too. Every month pretty detail on that, which they should. But it’s been more challenging in general. This is great stuff Frank, anything else before we part, otherwise, maybe where can people find you to get started on a loan?
Frank Sciara: Yeah. I mean, obviously, we’ve got, there’s a lot of details you can get into and get into the weeds. And I want to get into much of that here on this call, but happy to discuss if somebody is kicking the tires on something, we’re always happy to spend the time, get involved early. We’re happy to put out a soft coat. It might help you sharpen your pencil when you’re maybe making offer, give you a better chance to potentially win that bit. So happy to do it. Again, I mentioned I’m with Grandbridge Real Estate Capital, you can reach me. I’m just going to go in and give you my office number. I think that’s the fastest and easiest way to reach me. (913) 748-4453. Feel free, give me a call. Happy to walk through, give you more details or look at any deals and help you out any way I can.
Ferd Niemann: All right. Sounds good, Frank. I appreciate it.
Frank Sciara: Ferd it is great. Good talking to you.
Ferd Niemann: All right. See you soon.