How a $210k water main replacement bid should come off a mobile home park's price
Take a park under contract at $1.42M, 55 lots, 51 occupied, lot rent at $355 against a supportable market rent of $465. Public water and sewer run to the street, with everything inside the park owned by the operator. Say the main is 2-inch galvanized, original to a 1968 build. Two contractor bids for directional boring a new HDPE main with new services and curb stops might land around $208,500 and $246,000, with the higher figure including asphalt restoration likely to be needed regardless. Call it $210k to $250k as a believable range. Pressure readings around 42 psi at the far end and rust in samples from the end-of-run homes describe a system with maybe two to five good years left, not an immediate failure. The negotiating question is how a seller and buyer split responsibility for a repair that's certain but not yet due. A seller's position that the pipe still works and shouldn't be discounted for a repair that might not happen for years has some logic. The buyer's counter, that a future buyer will apply the same bid against the exit price, so the current buyer is both buying the problem and effectively pre-selling it, is equally valid. Three paths are worth weighing on a bid this size: negotiate the full estimated cost off the price, negotiate half on the theory the pipe retains some useful life, or leave price alone and instead negotiate loan terms, a longer interest-only period that lets the pipe get funded from operating cash flow while rents move toward market. Getting the lender the bid before closing, rather than after, tends to produce better terms in any of these paths.
