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PALM SPRINGS, CA-Millennium Housing of Costa Mesa, Calif., acquired the 255-unit Sahara Mobile Home Park in Palm Springs for $9.6 million from Scottsdale, Ariz.-based National Home Communities.

The buyer is a non-profit organization that acquired the park by issuing low-interest bonds that will be paid off with the rental income from the property, broker John Reinhardt of Marcus & Millichap tells GlobeSt.com.

Reinhardt, who represented both the buyer and the seller, says the buyer and the city of Palm Springs devised a regulatory agreement stipulating that rent increases at the park will be limited to an amount sufficient to pay increased expenses, cover the debt service, and provide a small reserve fund.

“Wall Street has figured out that these parks are very stable, secure investments, so they will issue bonds at about 6%,” Reinhardt tells GlobeSt.com.

Only about a dozen mobile home parks change hands in Southern California each year, Reinhardt says, usually staying in the same family for years and often being passed down from one generation to the next.

The Sahara Mobile Home Park is at 1955 South Camino Real, in the heart of Palm Springs. It was built in 1970, covers 29.55 acres, and is 98% occupied, with rents averaging about $330 per month.

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