Ep. 59 | Interview with Jimmy Johnson – Assigning (Wholesaling) Tips From The Experts


On this episode of The Mobile Home Park Lawyer, Ferd interviews Jimmy Johnson. Ferd and Jimmy discuss deals, fees, and assignments. Jimmy shares some valuable tips and tactics. Enjoy!



0:00 – Intro
1:50 – Jimmy gives us insight into his background and how he got involved with MHPs
3:10 – Ferd asks Jimmy how he finds his deals
6:08 – Ferd asks if Jimmy routinely sells to the same buyer
7:59 – Jimmy tells us how he evaluates his fees
9:57 – Jimmy talks about how he structures deals so that he doesn’t get cut out at closing and if he hides his fee or if he shows it to the end buyer
13:28 – Jimmy informs us how open he is with his buyers, he lets them know he works with partners
15:22 – Ferd asks for any tips or tactics that Jimmy can share
18:50 – Jimmy discusses how it’s important to show you have time and not to rush your clients. You need to make them feel they’re important and build a relationship.
21:13 – Jimmy gives us some final tips and advice.



Ferd Niemann: Welcome back mobile home park nation, Ferd Niemann here again today with another great episode of the mobile home park lawyer podcast. My guest today, he’s an assignment expert, but over the last several years, in addition to doing mobile home park assignments, he’s got involved as a mobile home park owner, operator, property manager. Excited to have him on here today. Please help me welcoming Jimmy Johnson, Jimmy. Thanks for coming on.

Jimmy Johnson: Yeah, thank you for having me, pleasure to be here.

Ferd Niemann: I appreciate it, man. I’ve heard about you for years.  Unfortunately, I’ve not bought an assignment from you, so yeah, I don’t know, man. You’re hogging them all, but I’d love to buy a deal from you, but at least for today, I’d love for you to share with our audience, some of the tips and tactics that you’ve got. But tell us a little more about yourself and how you got in the mobile home park game.

Jimmy Johnson: Yeah, definitely. Yes, I’ve been in parks a little over two years now and started kind of when I decided I wanted to do parks, I looked at all the real estate asset classes and one decide, you know, what am I going to do? Real estate wise I want to jump into something and provide, you know, a lot of value and help people. So I, you know, decided on parks and love that there was a such a low supply of parks and then such a high demand. And I was like, well, am I going to jump in and do property management? Am I going to be on the asset management side? What should I start with? And I’m like, well, everybody wants deals. So decided to just jump into assigning, you know, slash wholesaling parks. So closed my first deal. Yeah, a little over two years ago and have closed 28 park assignments from that until now. And yeah, it made a full-blown doesn’t sound of it and love doing it. So we’ve done deals pretty much all over the country and it’s been great, you know, to different types of sellers, different types of buyers. So it’s really been a little bit of everything. Small parks, big parks everything in between.

Ferd Niemann: That’s great. I’m sure you get this question a lot, but I think the two questions come to mind right off the bat are, one, how do you find your deal? How do you relate to seller? And then two, how do you find your buyer? And there’s lots of ancillary stuff related to that, but those are the, that’s what it takes, right? You got to find a seller first and then find a buyer and then get paid in the middle. So give us your one-on-one on how you pull that off?

Jimmy Johnson: Yeah, yeah, definitely. So first, you know, you got to have the deal, so I think there’s even a saying that if you have the deal, the money, the buyers, everybody else will come. So that was obviously the first challenge when I got started was like, Hey, I got to get some deals. So I started doing all the kind of basic marketing stuff, the, you know, cold calls, direct mail, you know, doing the whole nine yards calling, or leaving voicemails. And that’s really still what we do today is just the basics. We’re not doing anything crazy. We’re just calling and send them letters. But yes, so that’s how I got the first one. It was a guy, I think he even knew that we were, you know, pretty green just getting started and he’s like, well, I’ve got this park. He was an out of state guy, his park in Alabama. He’s like, I haven’t seen it in a couple of years. It’s a hairy park to turn around. And then he’s like, yeah done. When I bought that one, I thought I was really going to make a big thing of it. So I bought another one. So he’s like, I only want to sell them if you’re going to take both. So I’m like oh, perfect.

Ferd Niemann: You are off to a great start.

Jimmy Johnson: And it was one contract for both. So now I’m like, all right, I have two parts, a couple of hours away, got to find the buyer. And I just kind of started with the basic, posting in all the groups on Facebook and on the forums and just getting it out there. Hey, I’ve got parks. And I got two others under contract pretty shortly after. So I remember that, and it was for a month or two, everything, all I was telling everybody, I’ve got four parks, you know, got to assign them, here is all the details. They are just firing off emails, 24/7. And now, you know, and, you know people refer and, you know, plenty of people reaching out as well. But in the early days it was just blowing up everywhere online. And I’ve got four parks to assign, or I met the buyers for all four of those. I think two of them came from Facebook and then the other one came from one of the online forums. And then they told their friends, did some podcasts and some interviews and got a lot of other people from there. So the buyer approach is, you know, if you do have that good deal, it’s going to sell itself. We haven’t done a lot of advertising on deals really in the last year, just because people are reaching out, having a lot of calls, you know, talks, just touching base with people and the good deals you really don’t have to push them and blast them out everywhere. So it’s been not easy, but it’s been easier to move them than it has been to get them. And again, it goes to that supply and demand.

Ferd Niemann: Right. Do you sell, do you routinely sell to the same buyer? I would imagine you’ve got a couple, you know, share players that you’re like, I saw this guy because he always delivers and doesn’t cut you out of your fee and all that kind of stuff.

Jimmy Johnson: Yeah. But of course we have a couple people that we’ve done, you know, multiple with one or two, you know, groups in particular. A lot of them is just geographically as well. So one group we assigned them a park in South Carolina and then, you know, it was marketing hard in that area, found another one and what’s 20 minutes away, so who’s the better buyer, somebody who is, you know, the neighbor to the property pretty much. So that’s also been one of our strategies just to get more deals as I’m calling sellers, you know, just trying to make it not a cold call, more of a warm call and right off the bat, you know hey, Mr. Seller, I’ve got to park five minutes away. What do you think about that new development in town? Or, you know, where are your tenants working? And just anything to kind of start more, just kind of talking shop about the area. So we’ve got a lot of deals that have been very close to other parks that we’ve assigned. So those are, you know, kind of easier to get and then easier to assign as well, just because we already have all the puzzle pieces put together.

Ferd Niemann: Got it. Now you and I talked about this previously, but for our audience, how do you come up with your fee? You know, brokers, as we know, typically get paid 3% or 6%, it’s kind of a norm, lawyers typically get paid by the hour, you know, title companies fees based on policy, but everybody else seems to have a fixed structure. I mean, in the assignment game, I think the industry norm quote of 5% to 10% fee, but depending on the deal, fee could be 1% or 99%. So how do you, what factors do you include to evaluate what’s the appropriate fee?

Jimmy Johnson: Yep, yeah. So there’s probably hundreds of little factors that all play on. I mean, some of the primary ones are, of course, you know, what’s the purchase price, the cap rate, cash on cash return. I mean, kind of the basics that everybody’s looking for. And then all the way down to, you know, kind of minor things that are still very important, such as the park in a flood zone, is there a lot of vacant park-owned homes, is the zip code good? You know, the park could be right on, you know, the core of the Metro or it could be an hour outside of the Metro. How were the records? You know, a lot of the deals that we’ve done, of the 28 that we’ve closed 25 of them have just been, gosh, only three have been being financed. So a lot of that also factors into, is this a bankable deal and a lot of these mom-and-pop sellers that are 70, 80 years old, they don’t even have a computer let alone keeping PNLs and leases. I am just driving around with the seller and instruct and he’s pointing out, all right, that’s unit number one, his name is Robert. He pays 400 a month. I think he’s parked on home just crazy, you know, crazy stories like that. But yeah, all those factor in from like a deal side. And then from a buyer side, you know, can you show proof of funds that you could actually perform? Have you worked with us before, do you own other parks? What’s your real estate experience? And we have a whole questionnaire that, you know, we’ll typically go through, but the fees have varied from as low as about 1% on some deals to we’ve done a 50% assignment fee deal. They are all over the board. It’s tough to pin down where the average is, cause we’ve taken equity in a lot of deals as well. But yeah, they vary from, you know, 50% of the purchase price all the way down to a, you know, 1%, 2%.

Ferd Niemann: Interesting. Yeah, that’s definitely good stuff. So obviously it depends on a million factors. How do you structure them, so that you, A, don’t get cut out at closing and or B, do you hide your fee or show your fee to the end buyer? Because I had a call yesterday from a guy who is doing this and the end buyer wanted to see his feet and he wanted to do a double close essentially, but he didn’t want to show his fee. And it became hostile between those parties. So I’m curious how you do yours.

Jimmy Johnson: Yep. So we’re a 100% transparent. So we’ve never done a double close. Don’t plan on doing any double closes. And we’re, you know, wanting to work with people who see the value that we’re bringing to the table. So even on the deal where the fee was 50%, a lot of other people, you know, kind of scoffed at that, no way, that’s too much of a percentage. And then we had, you know, offers and buyers who said hey, this is a great deal. Even after the 50%, I’m still getting the spark 30%, 40% less than what he thought it was worth. So we always are, you know, here’s the contract price. So for just using round numbers, we’ll say, here’s the contract, you review it. Maybe it’s a million-dollar purchase, maybe the fees 50. So they know exactly what the purchase price is, what the fee is.  They see the contract that we have with the seller. I introduce the buyer to the seller, which like anybody who wholesales or assigns, it’s like, that’s like the number one no-no. And we do that, because they’ll cut you out. And I’m like, well, we’re all relationship-based. So the sellers, they know that we’re going to close, and they trust us, and they see the experience and they feel comfortable and we’re communicating with them or visiting them in person. And then the buyers, you know, anybody it’s such a small industry, if somebody is going to try and burn you and cut you out of the deal, you know, word would just spread so quick. And, you know, we’re just working with people who we feel like we trust enough, and they trust us to, we’re doing diligence together. We’re working the seller together. They’ll often go, you know, do a site visit. Maybe I’ll do the first one. They’ll do the second one. So we really maybe more so than we should, but we really, you know, put a lot of value in that trust. And then let’s, you know, build a relationship and both be on the same side and have everybody win. So one of our slogans has been, we want win, win, win, win deals, so the seller wins, the buyer wins, we win. And then the tenants went as well. Cause most professionally operated parks are going to be better than a mom-and-pop operation.

Ferd Niemann: Sure. No, that’s great stuff. I think you’re hitting the nail on the head there with the relationship piece, cause you’re right. It’s small industry, I tell people that all the time like, well, how can I trust that you’re going to do this. I’m like, well, I mean, I got a relatively public profile and if I screwed you, it’s probably not good for my overall business. So I won’t, I tell you that, but if I do, and then as a lawyer, I can say, look, I’m also a licensed to practice law. If I do something really bad, you can go file a bar complaint. That’s kind of a big deal, right? So I’m not going to screw with that. So, you know, you don’t know me, but you can know my circumstances and know that I’m not going to screw you right?  That’s definitely good. So with the sellers, do you tell them that you’re going to wholesale deal with somebody else from the beginning? Or do you tell them, Hey, me and my partners are buying it and then you introduce them to the end buyer as your partner or assignee or someone else.

Jimmy Johnson: Yep. It’s always from the start it’s, you know, my partners and I, you know, from kind of the first visit, I’m not bringing that up on the first phone call and saying it’s may and then as you know, the relationship progresses and we’ll even kind of make a joke about and say, Hey, well, you know the price that you want, you know, I’ve got to have partners, you know, one guy can’t do this alone. So we try and make it a joke. And then they totally get it and yeah, and like gets, you know, everybody plays to their strengths, you know, maybe you’re coming in as the partner and your expertise is the legal side of the business. And we have somebody else who’s bringing the capital, I am bringing the deal on the management. So, you know, I’ll even explain who everybody is in the transaction. So then they’re like a hundred percent comfortable. They know who is who, there’s no confusion of like, so who’s this guy who just stopped on and that you know, other people who are selling deals, they’ll say, well, what happens if those buyers back out, then how are you going to introduce new partners? I’m like, well, if the buyers are backing out, it’s because something so concrete was found in diligence that it’s probably a deal killer. And then we will present the seller with, you know, the ultimatum, Hey, you have tiny lost units than you said, this is the price that we have to be on. And it’s either kind of a take it or leave it thing. So when I assign that contract and we have a deal, we’re both going into it 100%. So there was no backup buyers. It’s either we’re going to close it together or we’re going to make, you know, the seller an offer. And, you know, if he declines that retrade, then we’re going to have to kill the deal. So it’s, you know, full steam ahead. And we’re all partners, we’re all on the same team and you know, let’s get it closed.

Ferd Niemann: Yeah. So sounds good, man. That sounds like a good approach. So lots of impact there as far as, you know, how you find deals, how you sell deals, how you build the relationship, how you package your fee, the transparent method. That’s good. What other tips or tactics that we haven’t covered? Can you share that you think you have value to our listeners?

Jimmy Johnson: Yeah. I think now it’s such a competitive market, as you know, it’s tougher to get deals, I think every month than it was the month prior. So we’re doing everything that we can to get in front of the sellers and stand out. So a lot of people will say, you know, I want to get my first park, what can I do? We always say, just call the parks that are closest to you because if you have that hometown approach, I live 10 minutes away. That’s always going to be better than the guy across the country. So definitely, for just trying to get deals, if you, you know, are trying to do your first park or if you have 50 parks, a lot of people don’t call those ones that are close to us. So the closest park to my house called them, built the relationship.  And now that’s one that, you know, we own and operate and it’s five minutes from my house. So I’ve told a lot of people that I’m like, you never know that guy could live in your neighborhood for all you know, and yeah, the park is a couple of minutes away. So definitely not, I mean, could, you know, talk for hours on due diligence and all the tips and tricks that are. But I think definitely getting out there as early as you can, a lot of people, they want to delay that trap and kill a bunch of birds with one stone all the way at the end. But you got to get out there, meet the seller, get in front of it, it’s going to help you see the park, see if there’s any big red flags. And also if you have to retrade, I think the odds of a retrade going through are just so much higher. If you have a relationship, he’s met you and you got to like spend some time, walk the park with the seller. So like, you know, met with sellers and it’s been a, I don’t know, seven, eight-hour day walk in the park that I thought we probably could have knocked out in 30 minutes. That’s what they want to do. You know, it is their park and I’m the one trying to buy it. So it’s, you got to kind of just cater everything to the seller. They want to talk about, you know, how they’re showing off how they rehab the home. You got to sit on that home and oo, ahh at all the things that they’ve done in there. And you’ve really got to just put the time in and just form that relationship just above all else.

Ferd Niemann: I’m chuckling because I was telling my, I’ve got one of my teammates here today out looking at two parks in middle Missouri. My wife said, what time are you coming back? I said, depends. I said, remember when I looked at that park in St. Louis. And I was supposed to be there for 30 minutes that I was meeting her in vacation when she was with my in-laws and the kids. I was like, I’ll meet you guys down at the Lake. And it was a four-hour tour of a park with no park owned homes. I’m like, what could we possibly look at? And he literally, said I don’t want to walk. He literally got in his truck and drove in front of the house, number one and told me the history for 30 years of who lived there, how many kids they had, how dysfunctional their marriage was, what they did for living. The last seven violations. Why they’re one month behind on rent or not. And then he drove 30 feet, put it in park and did it again, 67 times. And I was just like, that was that the most overblown tour ever? That was a 15-minute tour that took four hours. Now I got to explain to my wife, so I’m late. So I totally get it. You got to do it right? You ruin the relationship if you just said, Hey man, I’m too busy. I got another appointment. That tells people you’re not important.

Jimmy Johnson: It is awful. Yeah, and I know a lot of guys, especially when you’re making those calls, it’s a lot of fun if you’re doing it in person, but they want to just fire the offer out right away. Cause you never know, maybe that park, you know, you thought it was worth 600 grand and the guy wants 6 million, usually have no idea. So we’ve kind of taken the approach we don’t bring up price at all in the beginning. So we’ll like go through that whole meeting. And we still don’t know at all what the guy wants, and we’ll go weeks of communication. Sometimes months before we finally get to the price. And then we obviously are hoping that the relationship at that point is going to be more important than the price. And of course, we’ve had dozens of times where you know, we’re months deep and the guy wants, you know, tenfold more than it’s worth. It’s, depending on the time and flown across the country, driven 10 hours to parks, done it all just for the guy to do that same visit. And then he’s like, oh yeah, I want this insane price. Cause you could redevelop it. It is out in the country, but this is going to be the new mixed-use in town.

Ferd Niemann: Sellers are tough, man. They’re definitely tough. Especially you already mentioned today’s market. I mean, it’s like, every broker in the country, every guy like you or me in the country, it seems like has called the same seller. So the seller has this inflated, what I thought was inflated opinion of value. That might actually be the new opinion of value. Cause that’s not bankable.

Jimmy Johnson: Yeah. And you know, all the letters that we’re going to close cash quick 30 days. So they’re like, Hey, everybody’s ready to close this thing, like sight unseen with cash, no matter how much the purchase price is. So they’re like, why in the world would you need seller financing when I’ve got guys with a briefcase full of money ready to close it.

Ferd Niemann: Yes. It makes it harder. What’s funny, I’ve got legal clients that I’ve gotten letters from and they don’t know it’s my property cause it’s ABC, LLC. And I’m like, one time I literally drafted the letter for the client and his wife sent them out to a hundred people or a thousand people. One of them was to me, but I was just like, you guys need to scrub your buyers list to learn your sellers list a little better, you’re not going to get this one via the letter.

Jimmy Johnson: This isn’t a mom-and-pop seller. Full circle.

Ferd Niemann: Got to be your lawyer on the acquisition. This is great stuff. Anything else you want to share before we end here today?

Jimmy Johnson: I think that I’ve covered, you know, the kind of one-on-one of a park assignment. And I think it’s definitely a great way to buy parks. You know, we’ve assigned deals to first-time buyers. That’s one of our favorite things that the brokers don’t want to listen to them. Cause you know, they don’t have all the experience. They don’t have millions in the bank. So we’ve done a lot of deals with people who nobody else would assign a park to or sell a park to all the way from that up to, you know, institutional guys. So I think it’s a great way to buy deals, especially for, you know, busy professionals who don’t have the time to do the marketing. And it’s tough to find deals out there. So I think definitely encourage people to, you know, look to buy assignments and if they come across the deal, that you know, maybe it’s too big or too small for them to try and signing it themselves.

Ferd Niemann: Sounds good. Appreciate it, Jimmy. Thank you.

Jimmy Johnson: Yeah, right back at you. Thank you.





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