(Bloomberg) -- Real estate investors have turned to single-family rental homes, warehouses and even movie studios while the pandemic makes it harder to put capital to work in more-traditional types of commercial property.
Mobile home parks are also getting a look.
More than $800 million worth of the parks changed hands in the second quarter, up 23% from a year earlier, according to a report by commercial real estate firm JLL. Total commercial-property purchases declined 68% to roughly $45 billion in the same period.
Institutional investors accounted for 28% of mobile home park purchases, the highest share since JLL started tracking the asset in 2010. Valuations -- based on the price investors pay for sites that are leased to mobile-home owners -- increased 26% from the second quarter of 2019.
The parks are attracting new interest while Covid-19 hammers prospects for hotels, shopping malls and other commercial-property types. Institutions are also drawn to opportunity to consolidate and upgrade assets owned by smaller investors, said Scott Belsky, who leads the manufactured-housing practice at JLL.
Residents at the parks typically own their homes but lease the ground they're on. Those rents help generate stable returns for investors, according to Belsky.
©2020 Bloomberg L.P.
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