MHInsider™ April 2018 - MHI National Congress & Expo Edition by MHInsider

APRIL 2018

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2018 MHI National Congress & Expo Edition IN THIS ISSUE: Multi-Industry Growth for Sun Communities What You Need to Know About Fair Housing Law and Emotional Support Animals Wally Comer of Adventure Homes A Publication of

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contents 27 SPECIAL FEATURE: National Congress & Expo

VOLUME 1 • ISSUE 2 APRIL 2018

Don’t Miss Our Special 2018 MHI National Congress & Expo Section in This Issue, Including: • Complete Show Schedule • Important Updates from MHI • MHI 2018 Legislative Priorities • Local Attractions & More!

ON THE WEB MHInsider.com –––––––– Executive Editor

Darren Krolewski darren@mhvillage.com

Managing Editor

Patrick Revere patrick@mhvillage.com

Creative Director

Mark Dollan dollan@mhvillage.com

Contributors

Greeting Your Customer

Industry Happenings & 2018 Spring/Summer Event Schedule

Freddie Mac SingleFamily Expands its Role in Industry

Paul Barretto Ken Corbin Mike Dawson Dr. Lesli Gooch Juliana Ludema Michael Power Ken Rishel Rick Robinson Donald C. Westphal Darin Zaruba

Cover Photo

Pembroke Downs in Chino, CA Sun Communities, Inc.

What Does It Take to Start a Related Finance Company?

25 Fair Housing Law and Emotional Support Animals

MH Part of Solution to America’s Affordable Housing Problem

48 Industry Profile: Wally Comer of Adventure Homes

Sun Communities Sets Course for Multi-Industry Growth

57 The Manager’s Job is Mostly Outside the Office

Advertising Sales

Matthew O’Brian Call (877) 406-0232 matthew@mhvillage.com

Disclaimer Although we have made every effort to ensure that the information in this issue was correct before publication, MHVillage, Inc. and the publisher do not assume and hereby disclaim any liability to any party for any loss, damage, or disruption caused by errors or omissions, whether such errors or omissions result from negligence, accident, or any other cause. Opinions expressed are those of the author or persons quoted and not necessarily those of MHInsider or the publisher MHVillage, Inc.

MHInsider™ is published by:

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Eighth Consecutive Year of Growth in Shipments

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Welcome

WELCOME

Welcome to the Second Issue of The MHInsider™

f there’s one lesson the first issue taught us, it’s that print is not dead. Not in the publishing business, and certainly not in our industry. Since we launched the print edition of the MHInsider at The Louisville Show in January, we’ve been genuinely humbled by the enthusiastic reception we’ve received from our friends and colleagues in Darren Krolewski, Co-President & CBDO the industry. We appreciate your at MHVillage® kind words, thoughtful feedback and astute critiques. I’d especially like to thank those members of the industry who have generously supported the MHInsider as advertisers, contributors and advocates. Without your support, this publication would not be possible. Many of you have graciously shared your time to be interviewed, as well as introduced this publication to your members or readership. We are grateful to have earned your confidence. Our goal was to create a publication that you’d be proud to hand to an investor, a new team member, or perhaps even a family member unfamiliar with manufactured housing, and confidently say, “This is my industry.” The April issue of the MHInsider is even larger than our premiere, both in size and circulation, with more of the insightful content, timely news and unique profiles you told us you found most valuable. And we could think of no other event more fitting to feature than the 2018 MHI Congress & Expo. Congress & Expo is undeniably the preeminent event in our industry, where for just a few days manufactured housing takes center stage at the national level. It’s a place where the industry’s top professionals converge each year to gain perspective, enrich their knowledge, expand their networks and celebrate all that is great about our industry. And what a great time it is to be in our industry. The economy is strong. Shipments are up. Progress is being made on behalf of the industry in Washington. New financing resources are on the horizon. The need for affordable housing, from urban centers to metropolitan suburbs, to rural America, has never been greater.

On all fronts, our industry is poised to seize the opportunity. You might say that when it comes to fulfilling the American Dream, manufactured housing is a sure bet. Now there’s a little Vegas for you. If you haven’t already, I invite you to visit our website at www.MHInsider.com to view the latest industry news, as well as signup to receive our bi-weekly email updates and next full issue of our quarterly print magazine that will be distributed in July. And should you find yourself in Las Vegas, be sure to stop by and say hello. MHV

MHINSIDER.COM • APRIL 2018 • MHINSIDER™ |

SALES

“ You never get a second chance to make a great first impression.” – Will Rogers.

Greeting Your Customer By Ken Corbin, President at CallKenCorbin.com

s your customer enters your office, everything they see must give them an emotional feeling of trust and comfort. In our hemisphere, everything we do is left to right and top to bottom. Think of coming up to a stop sign. You look left, look right, look left again and then proceed. If you’re reading a book, you look left to right and top to bottom. If you’re writing a letter, you again go left to right and top to bottom. The same natural tendencies are with customers who enter your parking lot. Watch carefully where people park and you’ll see the majority will park to the left of an entrance to a building. Regardless of where they park, make sure there are signs that clearly state “Please Register at the Information Center”.

Focus Walls So if you can expect that a customer will naturally look left, then look right and then move forward into your office, even if you have a left swing door, this is still the natural way a customer will get that first serious impression of your operation. That being the case, the next time you enter your office, look carefully and note everything your customer sees for the first time.

Employee and customer pictures, point-of-purchase materials, testimonials, letters of recommendation, live plants and round tables with chairs are essential. Let’s start with pictures. First of all, remember that every picture in your office must be framed. Nothing is ever to be placed on a wall with scotch tape, thumb tacks or push pins. Make it a habit each day to Ken Corbin, President walk through CallKenCorbin.com the office and ensure every wall hanging is evenly spaced and the taped-on back of the picture is held in place. You’ll hear me frequently say, “Make doing business with you easy!” Thus, the first pictures you’ll want your customer to see is pictures of every employee. Remember, they’ll look left to right and since we also read top to bottom, put everyone involved in the sales process starting at the top left. If they are visiting your office for the first time, and had already spoke to someone, this is an easy way for them to remember who they talked to on the phone or via email. If they’ve previously

visited your model home village, it’s another easy way for them to remember who they spoke to during their last visit. Every picture should simply have the person’s name and title. Avoid turning the picture into a brochure. See, make doing business with you easy! You’ll note that as we go thru this article, I’ll be using the term “Model Home Village” and not “Lot” or “Sales Center.” We’ll be spending quite a bit of time on subliminal phrases as we go thru this series.

Success Breeds Success Throughout the office, hang pictures of customers who have purchased homes from your company. I recommend putting four pictures to an 8 ½ x 11’’ standard size with the city the homeowner is from underneath the picture. Don’t post their names. Why? You want your customer to subconsciously see other people who are pleased doing business with you. It also will have them thinking about who those people might be; all the time absorbing friendly smiles from satisfied and happy customers. You want your new customer to, consciously or not, project themselves into the photo on the wall. CONTINUED ON NEXT PAGE MHINSIDER.COM • APRIL 2018 • MHINSIDER™ |

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CONTINUED FROM PREVIOUS PAGE

time. This will give you a jump start on your pictures. Thus, your new prospect is looking at all of the happy customers who have done business with you. So, success breeds success and you’ve begun the process of selling on emotion, feelings and trust. I guarantee this will be one of the more important areas of the business and will take down many of the initial barriers your prospect might have.

Coffee, Soda, Water

Because people who have their picture taken are apt to smile, I do recommend taking the photos in front of the home the customer is purchasing. It’s also great to have it taken with the sales consultant, if possible, to show everyone is happy and smiling. In the beginning, start with customers who leave a deposit for the first

8 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

There are three primary drivers customers feel are important when making a housing decision. They are quality, service and price (or value). Your initial impressions have done a great job in letting the customer know you build dreams and make people happy. One of the unique methods I’ve used to create an initial feeling of value is to have a 25 cent soda machine available to customers. To give away something is OK, but it doesn’t create value.

Many businesses offer free soda or bottled water, but the 25 cent machine has them contemplate why the drink is so inexpensive. It makes them look for a quarter, ask for change and creates that subconscious thought of, “Wow, if their soft drinks are only 25 cents, their homes must be inexpensive as well.” I don’t believe in charging for coffee or water. However, I do post a cute sign in the refreshments area that reads “Unattended children will be given an espresso and a free puppy!” Everyone laughs when they read it, and it’s another subconscious way of taking down a barrier. What we’re doing here is setting the foundation on the three premises: How do I want someone to remember me? How can I create the right first impression? How do I want to be perceived? MHV Ken Corbin is an industry leader in helping communities & retailers sell more homes. He can be reached at ken@callkencorbin.com or (888) 823-4945.

NEWS BRIEFS

Happenings

INDUSTRY

News and updates from around the industry...

YES! Communities has promoted Steven J. Schaub, the company’s Chief Operating Officer, to the position of Chief Executive Officer, replacing Gary P. McDaniel. Karen E. Hamilton has been promoted to the position of Chief Operating Officer.

Bruce Thelen has moved from Senior Vice President at Champion Homes to Senior Vice President of Sun Home Services for Sun Communities & RV Resorts.

Darrell Boyd has moved from Senior Vice President of Triad Financial to Executive Vice President at CIS Home Loans.

VENTS

Berkshire Hathaway’s Vanderbilt Mortgage has agreed to acquire Silverton Mortgage and its nine Cobb County, Ga. locations.

Triad Financial now offers floor plan financing to help dealer-retailers increase and stabilize inventory of new homes.

Woodland Hills Land Lease Community, formerly Sherwood Forest Manufactured Home Community, has changed ownership. EMS Real Estate Enterprises, LLC took control of the property Jan. 9, 2018. Susan McCarty and her business partner Erin Smith, both of Spotlight Strategies, are the real estate investment company’s leadership team.

Datacomp and MHVillage have promoted Michael Boers to be Co-President and COO and Darren Krolewski to be Co-President and CBDO of both organizations. Both were previously Executive Vice Presidents with the companies.

Dominic S. Moceri, 86, Hall of Fame Builder and Developer of residential communities in southeastern Michigan, passed away of natural causes amongst his loving family at his Florida residence on Feb. 7, 2018. Mr. Moceri, who was born in Detroit in 1931, was known as the “Silent Giant” and forever changed the landscape of the region. While known in recent years for luxury homes, the Moceri family has built more than 55,000 residences in a wide array of styles — luxury homes, ranches, condominiums, apartments, manufactured home and senior living communities. He is survived by his wife, Frances (Grillo) of sixty years, his 6 sons, Sebastian, Michael (Beverly), Jerome (Deborah), Dominic J. (Anna), Mariano (Maria), Frank, and 19 grandchildren and 10 great grandchildren.

2018 Spring/Summer Meeting & Event Schedule

Two Days of New Home Sales & HUD Plant Tours May 8-9, 2018

Elkhart, Ind. - RV/MH Hall of Fame Museum & Library

Illinois Manufactured Housing Association Annual Conference May 15-17, 2018

Springfield, Ill. - Wyndham Springfield City Centre

Manufactured Housing Communities of Arizona Annual Convention May 15-17, 2018

MHI Summer Legislative Fly-In June 25-26, 2018

Washington, D.C. - Washington Court Hotel

Multi-State Convention Aug. 4-6, 2018

Orange Beach, Ala. - Perdido Beach Resort

RV/MH Hall of Fame Heritage Foundation 2018 Induction Ceremony Aug. 6, 2018

Elkhart, Ind. - Northern Indiana Event Center

Chandler, Ariz. - Wild Horse Pass Resort

10 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

National Tiny House & Simple Living Jamboree Aug. 23-26

Austin, Texas - Travis County Expo Center

George Allen International Networking Roundtable Sept. 5-7, 2018 San Diego, Calif.

MHI Annual Meeting Sept. 23-25

Huntington Beach, Calif. - Paseo Hotel & Spa

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FINANCE

Freddie Mac Single-Family Expands its Role in Manufactured Housing

By Mike Dawson, Vice President Single-Family Affordable Lending Strategies & Initiatives, Freddie Mac

anufactured housing has a crucial role in solving our nation’s affordable housing crisis. Millions of America’s families rely on manufactured housing – especially in rural areas. Today, more than 17 million Americans live in manufactured housing and the need is only expected to grow. With this understanding, the Federal Housing Finance Agency (FHFA) tasked Freddie Mac to develop a comprehensive plan – under Duty to Serve – to help solve the challenges of financing more manufactured housing and to support much needed affordable housing for families. Our comprehensive Duty to Serve plan of activities and objectives is available on FreddieMac.com. As we developed our Duty to Serve plan, Freddie Mac listened to industry feedback, including feedback from manufacturers and other stakeholders. Last year, we formed the Manufactured Housing Initiative Taskforce, which includes a diverse group of industry participants. Part of the objective of this taskforce is to address enhancements to Freddie Mac’s existing offerings, flexible underwriting and product features that can be efficiently and effectively launched and adopted by the market, as well as socialization of features we plan to bring to market. We value the expertise of our partners and will leverage their market-specific knowledge to address the needs of the manufactured housing market. And we’re already making changes for the better. For example, our single-close construction loan process will be extended to borrowers of manufactured housing

Photo courtesy of Equity LifeStyle Properties, Inc.

titled as real property. This allows the borrower to finance both the construction and the purchase of the home using one loan, so once the construction of the manufactured home is complete, the loan seamlessly converts into a permanent loan bearing either a fixed rate or an adjustable rate. This will make approvals faster, reduce closing costs and eliminate unnecessary paperwork. And for lenders, it will mean less risk. We will continue to do more. One concern that came across loud and clear from our conversations with stakeholders is there’s only a limited number of lenders that provide financing to manufactured home buyers. To solve for that, market participants encouraged us to expand liquidity, implement standardization measures and enhance consumer protections.

Over the next three years, Freddie Mac plans on doing the following for manufactured housing titled as real property: • Work with lenders to increase our purchases of loans in this important market segment, • Increase access to education and resources for future homebuyers, • Identify best practices and provide technical assistance to market participants, and • Develop additional loan features to meet the market’s needs. For manufactured housing titled as personal property, or chattel, we plan to work with market participants to: • Promote a greater understanding of the market by conducting research and publishing the results, CONTINUED ON NEXT PAGE

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• Initiate a chattel pilot offering, and • Develop homebuyer education to support chattel financing. We’re also taking a test-and-learn approach. Our partnership with Kentucky-based housing intermediary Next Step focuses on educating potential buyers of manufactured homes, with the ultimate goal of expanding responsible homeownership of energy-efficient manufactured homes. Next Step’s leadership in the field, range of relationships and passion make them the right partner for this effort. We’re encouraged by the results so far. At Freddie Mac, we are reimagining the mortgage experience and leading the mortgage industry to look at housing issues in new ways, understanding the broader problems facing these markets and applying a new generation of solutions. As we move forward, we will continue to engage with the industry, community organizations, all levels of government, and other dedicated organizations to take action and give lenders additional tools and resources to better serve the manufactured housing market. We look forward to meeting more industry participants at the 2018 MHI Congress and Expo in Las Vegas, to listen to your ideas, and share ours, for this vitally important market. MHV Mike Dawson is vice president of Single-Family Affordable Lending Strategies & Initiatives at Freddie Mac. He leads affordable products and offerings, strategies, research, and regulatory and conservatorship activities associated with broadening access to credit. Among his previous roles, he oversaw Single-Family technology and data initiatives and managed Freddie Mac’s structured products issuance programs, including REMICs, Strips, and other structured securitizations. 14 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

Serving The American Dream Through Aﬀordable Home Ownership

FINANCE

What Does It Take to Start a Related Finance Company? By Ken Rishel, Managing Partner at Rishel Consulting Group

s a national consultant who works with community owners in the manufactured housing industry I am asked quite often what it takes to start a finance company. Of course, the person asking the question is expecting a simple answer, but unfortunately, the answer is never simple. The first question should really be, “Do I have enough potential loan volume to justify considering starting a related lending operation?” Once the potential volume is known, that number needs to be considered in relation to what state or states the community owner or retailer wants to operate in, because some states are more expensive to start up in and some are more expensive to operate in, and some are expensive for both. What may be a very good idea in one state is not always a good idea in a neighboring state. Only when the potential volume is measured and considered against the proposed state or states of operation and found sufficient should any plans for a finance company move forward. If the volume is insufficient for that

purpose, other legal alternatives should If the operator can personally fund at be explored. Some communities will have least the first ten loans, and they have enough volume to enter into a joint ven- some sales and negotiating ability, all the ture program like Triad’s C.O.P. program, money they need to make these loans is but some will need even another solu- quickly and easily available from a varition. Retailers will have less alternative ety of sources at useful interest rates and choices, but there are real and very vi- terms. They may need some additional able choices for the low volume retailers as well. The second question is how much capital is available and what is necessary to access it? Some operators are sitting on Ken Rishel Rishel Consulting Group their own cash sufficient to at least make a few loans while others can easily borrow training in locating and persuading sourccapital. If borrowing is necessary, then es of capital, but that is easily remedied by the operator needs to ask themselves most successful manufactured housing how much can be borrowed and at what operators so then ongoing capital should interest rate and for what term? be no real problem. If an operator lacks To be successful, borrowed capital should have an interest rate of 4-6 CONTINUED ON NEXT PAGE percent with a fixed term of 10 years.

To be successful, borrowed capital should have an interest rate of 4-6% with a fixed term of 10 years.

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either time or ability to raise these funds, there are joint venture relationships that can solve that problem. The next question that must be asked is in to regards of the ability of current staff to assume the roles necessary for the success of the related finance company. Will it be necessary to hire additional personnel? How many? Among the current employees who, if anyone, can learn and perform all or part of these duties? Again, the projected volume will be an important consideration. The final preliminary question is how does the operator acquire the knowledge and the tools necessary to get an operation up and running? Does one retain a knowledgeable consultancy or a knowledgeable law firm, or treat it as a do-it-yourself in-house effort? The answers will affect the needed upfront investments in getting the operation started. Assuming the decision to go ahead is positive and the other questions are resolved, here is a brief step by step synopsis of what must be accomplished prior to seeking the first loan: The related finance company is going to need an MLO or mortgage loan originator. These can either be recruited and hired, or using existing personnel from the parent company, getting someone licensed. In a few states, like Texas, state law allows the hiring of part-time outside MLOs, but in most states that is not possible or legal. As a result, unless the organization hires a new and fully licensed MLO, someone selected for this role must make application for licensure, attend mandatory training, pass federal and state licensing exams, and pass both criminal and credit checks before successfully licensing. A new, and separate, legal entity must be formed for the purpose of serving as the state licensed lending operation. Once that has been accomplished that entity must seek licensure in the state or states in which it intends to operate. Bonds must be secured and any other requirements met and the network of regulations must be navigated in order to successfully license the new lending entity. In some states, this process is easy and inexpensive, and in others, like Illinois, the process can take as long as a year to complete, and then only with knowledgeable assistance. Once the new entity is set up, a compliance management system must be set up to deal with all of the laws that relate to lending. Written policy and procedure manuals must be created and signed off on by the Board of Directors in the case of a corporation, or the Managing Partner of a LLC. Employee training materials must be created for use with employees of the new entity. A system for auditing the system must also be created to determine the success of the system in assuring compliance with the various laws. A Compliance Officer must be selected and properly trained in their duties as well. This person must have the authority to correct or stop practices or personnel that fail in the goal of total compliance as well as accepting responsibility for training employees in compliance related matters and monitoring the performance of both the new entity and all employees tasked with compliance related procedures. Decisions must be made regarding who will have the authority to underwrite and grant loans for the new entity. If training 16 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

is required that also must be accomplished. A Loan Policy and Procedure Manual along with a Credit Matrix must be created not only to assure that loan portfolios perform as desired, but also to assure compliance with Fair Lending and other laws, rules and regulations that govern the decision process of making or denying loans. A written or computer-based method of tracking all loans and their performance must be acquired and put into operation. Internal forms must be created or acquired as well as all consumer documents that include, but are not limited to, loan closing documents. Once all the preliminary work has been accomplished and all employees are properly trained and all licenses are in place lending can begin. Depending on the state or states involved this process can take between 90 days to as long as a year. So why would any community operator or retailer go through this process? Simply because it helps fill communities and sells homes that otherwise would not be sold. Many community operators are buying communities with as low as 50 percent occupancy and filling those communities within one to two years. Many retailers have seen a 20-50 percent increase in profits within six months of starting their lending operations. Starting a related lending operation is not for everyone, but, for those capable of doing so, it is almost a no brainer. For others, there are legal alternatives that, while not as profitable, still offer real opportunities. MHV

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FINANCE

Manufactured Housing is Part of the Solution to America’s Affordable Housing Problem By Paul Barretto, Manufactured Housing Lead, Fannie Mae

ffordable housing is hard to find these days, making it tougher for many people to sustainably rent or own their home. But Fannie Mae is dedicated to leveraging breakthrough solutions to address this shortage, and providing greater housing oppor tunities for low- to mode rat e - i n c o m e households. Under our Duty to Serve (DTS) UnderPaul Barretto served Markets Fannie Mae P l a n , we’ v e identified manufactured housing as one of the most widely available affordable housing options. “With DTS, we have an opportunity to go beyond our current capabilities and change the narrative on manufactured housing,” says Bob Simpson, Fannie Mae’s Vice President for Affordable and Green Finance in Multifamily Business. “Even before the final DTS rule was published, we viewed manufactured housing as an important type of affordable

housing,” adds Sarah Edelman, the DTS director in Fannie Mae’s Single-Family business. “It’s also a viable and fast option to replace homes affected by disasters like fires or hurricanes.” Under the plan, she notes, Fannie Mae has committed to purchasing over 8,750 loans titled as real property this year, over 9,000 loans in 2019, and over 11,000 loans in 2020.

A Little Background There are many causes for the shortage of affordable housing, but to start with, fewer homes are available. The vacancy rate for owner-occupied housing stock is at a 17-year low of 1.6 percent. For the rental housing stock, it’s 6.9 percent -- its lowest rate since the early 1990s. Those numbers will stay low because not enough new inventory is coming online. For the full year of 2016, there were a total of 1.06 million new housing units completed. But to keep up with the number of new households forming, we should be adding 1.5-2.0 million units of housing every year. Low vacancy rates have helped push purchase prices higher. From the third quarter of 2012 to the third quarter of

2017, housing prices increased by 23 percent. Rents are also on the rise. More than 11 million renter households pay at least half of their monthly income for housing. It’s hardly surprising then that homeownership rates have dropped from a peak of 69.2 percent in 2004 to 64.2 percent in 2017. This is particularly true for younger households, whose homeownership rate dropped from 43.6 percent in 2004 to just 34.7 percent in 2017.

Information Into Insights We’re determined to find new, innovative solutions to these complex housing issues. Last fall, we sponsored The Future of Manufactured Housing Forum for industry participants to discuss challenges. Three issues really stood out – attendees asked for our help in standardizing and facilitating better sharing of industry data; changing the narrative surrounding manufactured housing for homebuyers; and initiating chattel financing. CONTINUED ON NEXT PAGE

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Sharing Data We’re in the process of designing a manufactured housing data exchange platform to serve the industry. We’ve already met with manufacturers, lenders, insurers, retailers, warranty providers, and other industry participants to find out what data they need to inform their business decisions, what data can be shared, and what gaps remain. The purpose of this effort is to encourage the industry to standardize data and to make manufactured housing data from Photo courtesy of Lakewood Village

contributors across the nation widely available. We feel this data can be used to gain insights, generate ideas, improve decision-making, and power innovation. A data exchange prototype is being tested by certain participants and will expand from there. We anticipate that as we get the word out, more users will join the effort, contribute their data, and make the platform even more robust. We’re already sharing our data in other ways too. Fannie Mae manages a $2.8 trillion book of single family credit risk, including loans made on manufactured housing titled as real estate. The industry and our approved lenders have asked us for greater transparency on our Single-Family book of business on manufactured housing to help them make more informed decisions.

In addition to the information we’ll share on the data exchange, we’ve committed to promoting transparency to encourage more lending on manufactured housing titled as real property and will make our data publicly available within the first half of this year, ahead of our third quarter commitment in our plan.

What Are You Doing About Fair Housing and the Americans with Disabilities Act?

Changing Perceptions During the past 18 months, we’ve met and talked with residents who live in manufactured housing to understand their pride of ownership, sense of security, and community. We’ve talked with people considering a purchase and found they are looking for homes that meet higher standards in terms of aesthetics, quality of build, and energy efficiency – the same standards already in use by manufacturers today. This aligns quite well with the industry’s request of us to offer more conventional financing for manufactured homes that appear more like site-built homes. The Manufactured Housing Institute (MHI) completed a two-year research effort that identified key segments of the population who do not consider manufactured homes in their purchase decision but would if they included more features associated with site-built homes, such as an attached garage, porches, and steeper roof pitches. To bring attention to these homes, we’re making some policy updates so we can purchase loans on homes built to certain quality standards. These homes, already produced by manufacturers today, conform more toward site-built features, and would be eligible soon for special financing backed by Fannie Mae. This project is a collaborative effort with manufacturers, retailers, appraisers, inspectors and lenders. We are working together to agree on the features for the homes, such as energy efficiency, and come up with an implementation that reduces the complexity of the loan product. Developing this affordable housing and finance option has been a collaborative effort involving input from manufacturers, retailers, appraisers, inspectors, and

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We can help you like we have helped many others 3 Professional Policy & Procedure Manual 3 Comprehensive Employee Training 3 Appropriate Forms for Compliance and Protection 3 Reviews of Community Rules and Leases

Let Us Help You Avoid Fines And Lawsuits.

(217) 971-3968 www.rishel.net

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FINANCE

lenders to design a solution that meets the needs of today’s homebuyer and highlights the capabilities of the manufactured housing industry. We believe this offering is part of the solution to the lack of housing supply.

Testing Single-Family Solutions On the Single-Family side of our business, we’ve taken the first step to establishing a pilot for chattel loans by submitting our Notification of New Activity. This is a formal request for permission from our regulator, the Federal Housing Finance Agency (FHFA). And we’ll continue with our test-and-learn pilots for manufactured homes titled as real property, such as allowing housing finance agencies to augment first mortgage financing with a second financing source for a combined loanto-value ratio of 105 percent. Such pilots will help us identify the ideas that are most successful for the industry and America’s homebuyers. To be successful, we need your continued collaboration and support.

Multifamily Efforts On the Multifamily side, we’re reviewing our current products to consider financing strategies for government, nonprofit, and resident-owned manufactured housing communities, and we’re researching and evaluating FHFA’s proposed minimum tenant pad lease protections in manufactured home communities. We are committed to leading this effort by engaging with key stakeholders to attain greater knowledge and awareness of the liquidity needs in these markets. The next steps will be to design and implement pilots to test and learn as well as determine the potential financing roles that exist for Fannie Mae. Based on Fannie Mae’s significant experience in developing new products, we believe this objective is realistic and will serve the needs of borrowers across this country.

Maintaining Momentum I want to make it clear that manufactured housing matters to Fannie Mae – and we are committed to doing our part in helping the industry serve more homeowners. As we move forward, keep your ideas coming – what’s working and what’s not. You can reach us me paul_a_barretto@ fanniemae.com (Single-Family) or my colleague Jose Villarreal (Multifamily) at jose_g_villarreal@fanniemae.com. MHV Paul Barretto leads manufactured housing initiatives and industry outreach for the Single-Family Customer Solutions-Duty to Serve team at Fannie Mae. He is responsible for the product management and development of the company’s manufactured housing solutions. Paul had an integral role in developing Fannie Mae’s Single-Family Manufactured Housing Underserved Market Plan under the Duty to Serve rule. He represents Fannie Mae as a member of the Manufactured Housing Institute and actively works to understand the challenges facing manufactured housing and the markets they serve. MHINSIDER.COM • APRIL 2018 • MHINSIDER™ |

TRENDS & INSIGHTS

Photos courtesy of Sun Communities

Sun Communities Background in Manufactured Housing Sets Course for Multi-Industry Growth By Patrick Revere, Managing Editor for The MHInsider™

un Communities started in Michigan more than 40 years ago, creating enjoyable and affordable manufactured home developments, places for families to live, play and grow. Its success in development and community have allowed the company to go national, go public and begin operating retirement communities, snowbird RV resorts and northern family campgrounds. Diversity is an element of the company history and strategy that continues to strengthen Sun’s corporate culture and its growth plan. “The root of the business is on the family manufactured housing side,” Sun Communities President and COO John McLaren said. “That could be called the hub, and with that hub comes a very strong stable revenue base. It’s manufactured housing, and we all know that. It’s allowed us to grow into the complementary business lines.” “The important part of all of this is that it brings us today to a very balanced portfolio,” he said. “We feel that our portfolio balance, along with our roots in land development, provide us with the widest net possible for future growth opportunity in affordable housing.”

Affordable Housing, Retirement, Vacationing McLaren said every bit of success the company has had to do with sustained company culture. “I can’t emphasize the importance of our culture enough, and we talk about it every day,” McLaren said. Sun Communities’ vision is to be “an inspired, engaged and collaborative team committed to providing extraordinary service to guests, residents and each other”. If the customer experience at the communities is what it should be, the residents and guests essentially become the sales force for the brand. “We have many guests who enjoy both types of properties having two homes, one in a snowbird community and another in the north,” McLaren said. The RV business is a lot more retail in nature than the MH side, but there is a lot to learn from each side of the business that can apply to both and can help accelerate growth across the portfolio. “Our social media and overall marketing presence is very important, but… Nothing compares to the type of business and growth you can gain from the customer

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experience on the property and the wordof-mouth,” he said. “That experience on the ground is the real driver for us. It’s like having a sales force of customers on the ground, and that realization came largely from the RV business. We have a resident sales force.” That kind of emphasis on customer experience at the community is difficult to achieve and maintain; requiring consistent effort on all levels. “We’re a culture that really believes anything is possible,” McLaren said.

The Golden Rule When he became chief operating office at Sun Communities in 2008, McLaren began touring properties. Managers everywhere had plaques hanging up with a customer service philosophy. It always seemed to be a dozen bullet points no one could remember. “We needed to simplify this, and it starts with The Golden Rule, and everyone knows what that is,” McLaren said. “Treat others the way you wish to be treated. And then there are three words CONTINUED ON PAGE 24

TRENDS & INSIGHTS

“ We are very proud of our culture and matching that with over 40 years of experience in property operations and development establishes a wonderful foundation for growth. As an example, in 2017 our team gained 2,406 sites of occupancy. That’s like adding eight fully occupied 300 site communities to your portfolio on top of the future runway being developed. That’s exciting!” – John McLaren, President and COO of Sun Communities

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TRENDS & INSIGHTS

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of paramount importance… communication, visibility and attitude.” McLaren took it upon himself to knock on doors, and talk to residents and guests. He still does. He asks how they like their community and he listens. When Sun acquires new communities, which they’ve done quite a bit of lately, McLaren collaborates with management, asks questions and listens.

Photo courtesy of Sun Communities

Communication, Visibility and Attitude “We understand that everyone has a bad day, and that can come from a lot of different places,” McLaren said. “But we ask that each of us stays in a positive frame of mind. And from there it gets back to the Golden Rule again.” To help with visibility of good communication and a positive attitude, Sun uses an internal portal -- a social network really -- they call “The Fridge”. “And our thought was that, when you were a kid and did something good, you wanted people to see it, you put it on the fridge. That’s the place. You posted it up and you were proud of it. And for us ‘the fridge’ is a place to come together, share knowledge, and to celebrate.”

Plenty to Celebrate Sun Communities was 15+ years in business when they went public in December of 1993. The company had 36 properties. During the next decade it would grow to 136 communities and 45,000 homesites. The industry, along with many others, slowed during 2002 through 2011, when

Sun Communities entered an expansion mode, acquiring communities, some community portfolios, and expanding existing properties. “We’ve grown into 350 communities in 29 states and Ontario, with 122,000 sites total,” McLaren said. “The value of all of that growth is a little more than $4.5 billion in acquisitions. “Some of it was through large portfolio transactions, but there’s also a large portion of what we call ‘onesies and twosies’,” he said. “We describe it in investors meetings this way with every acquisition since 2011 being a bit of dress rehearsal and thoughtful refinement for the next one.” In 2017 alone, Sun Communities had $150 million in acquisitions, including nine operating communities with 2,700 sites located in California, Florida, Illinois and Michigan. The company has acquired land in Myrtle Beach for an 840-site RV resort and will open another new RV property, Cava Robles in California Wine Country, during the second quarter. There’s a third for Larksburg, south of Denver, Colo., along with new sites for manufactured home developments under consideration as well. The company doesn’t shy away from development because zoning is difficult, or the entitlement takes time, in fact, they embrace the process. “During 2017, we built 2,100 expansion sites on our existing manufactured home and RV properties, and we anticipate an additional 1,350 expansion sites to be built in 2018,” McLaren said. Investments grade communities remain available, even if CAP rates are less generous than during previous times. Sun Communities expects to build onto a successful 2017 organically and through strategic expansion/ground-up development and acquisitions in many of its geographic locations across the country. “We look at individual communities on their own merits and how those merits fit in with our portfolio strategy,” McLaren said. “Looking at Florida alone, there’s a reason so many people love to live in Florida. We have four decades of experience there, and occupancies have remained in the high 90s”. MHV

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Sun Communities Had a Good 2017 and the Future is Bright... In 2017, Sun Communities’ total revenues increased $148.8 million, or 17.9 percent, to $982.6 million compared to $833.8 million in 2016. “Our strong 2017 results demonstrate our commitment to creating shareholder value by sustaining our high-quality portfolio and delivering best in class service to our residents and guests,” Sun Communities Chairman and CEO Gary A. Shiffman said in the company’s year-end reporting. “We begin 2018 with an optimistic outlook and an enthusiasm to once again deliver industry leading organic growth,” he said. “Consistent annual rent increases, opportunities to capture occupancy gains, the ongoing development and lease up of our available expansion sites, and the opportunity to convert transient RV sites to annual leases over time provide us with a runway to deliver ongoing attractive results.” Sun Communities’ measures on Wall Street have been bright across the board, indicative of its effective strategy and a strong market. • Core funds from operations for the year was $4.17 per share as compared to $3.79 in the prior year, an increase of 10.0 percent. • Same community net operating income increased 6.9 percent for the year compared to the year prior. • Home sales volumes increased 11.6 percent and 3.5 percent for the final quarter and year end, respectively, as compared to the same periods in 2016. • Revenue producing sites in creased by 2,406 sites for 2017 compared to a 1,686 site increase for 2016.

FA I R H O U S I N G

What You Need to Know About Fair Housing Law and Emotional Support Animals By Rick Robinson, MHInsider™ Contributor; General Counsel and Senior Vice President of State and Local Affairs for the Manufactured Housing Institute

f you want an ice breaker when talking to community owners and operators, mention emotional support animals, also called ESAs. For years, they have dealt with people claiming emotional support status for everything from pit bulls to alligators, saying that they should be provided special protection under the Fair Housing Act. For starters, fair housing law protects both service animals and emotional support animals, regardless of whether a landlord has a “no pets” or “pet fee” policy. While service animals are better defined as one that has been trained to perform a specific task, emotional support or assistance animals are harder to identify. As their status is murkier under the law, they provide a greater exposure for Fair Housing claims.

State Legislatures Are Tackling Misrepresentation of an Animal’s Status Some relief may be in sight as state legislatures are getting tough on people who fraudulently misrepresent the status of an animal to gain special treatment in housing. This year, aided with sample legislation from the Manufactured Housing Institute, many states are considering legislation making it a crime to fraudulently misrepresent the therapeutic need for an animal. Many of those bills would also hold landlords harmless for injuries caused by animals with such special designation. The movement started two years ago when a bill passed in Colorado. Last year,

Maine took action on the liability portion of the support animal situation. New York passed a bill to examine the need for standards. Virginia and Wyoming also passed bills making misrepresentation of an emotional support animal a crime. There is a drastic increase in the number of bills being filed on the issue this year. Most support MHI’s view of restricting the fraudulent use of emotional assistance animals and, in many cases, are based upon MHI’s sample bill.

Best Practices for Manufactured Housing Communities How should a community owner handle a request for reasonable accomCONTINUED ON NEXT PAGE

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modations? The best place to start is to go over the best practices to deal with emotional support animals. In doing so, it is important to remember that comfort/ support animals are not pets. Legally they are necessary tools for a person with a disability to have an equal opportunity to use and enjoy a dwelling and common-use spaces. Consider the following best practices: • Having a written policy on reasonable accommo dations is essential. Along with an accommodation request form, keep the policy and forms readily accessible. • Make sure your policy outlines an interactive process, stating the information you will need to make an informed decision on a tenant’s request. Pay attention to the request. It won’t go away. • Apply your policy and process equal ly to anyone requesting a reasonable accommodation. Train your staff on these procedures.

• Document, document, document. The key to winning any challenge is good documentation. • To show your commitment to fair housing practices in general, display the Fair Housing logo in the front office and in all advertising and leases. • Treat everyone like they are a tester from HUD. • Don’t charge a pet fee for an ESA. It is against the law.

ESA Pet Fees There are several recent cases on the topic of pet fees. This May, a federal jury returned a $37,343 verdict against a Montana landlord for charging a tenant with physical and psychiatric disabilities a fee to have a service animal. To learn more about service/assistance/support animals, please refer to Department of Justice’s frequently asked questions on the topic, as well as HUD guidance on service and assistance

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animals for people with disabilities, and the joint HUD-DOJ statement on “Reasonable Accommodations Under the Fair Housing Act”. Each month MHI publishes the Fair Housing Update. To subscribe, send an email to Rick Robinson at rrobinson@ mfghome.org. MHV Rick Robinson is senior vice president of state and local affairs for the Manufactured Housing Institute. At MHI, Rick works directly with state associations and local members on zoning and Fair Housing issues. He became familiar with manufactured housing issues when working as Legislative Director for U.S. Congressman Jim Bunning. Following his stint on Capitol Hill, Rick was a practicing lawyer focusing on commercial finance. As a lobbyist during that time he garnered a reputation for developing relationships on both sides of the aisle.

Keep up with all the latest industry news online at: mhinsider.com

SPECIAL SECTION:

National Congress & Expo April 24-26, 2018

2018 SCHEDULE

CONGRESS & EXPO

2018 MHI Congress & Expo Features Top Speakers, Education, Exhibits and Awards The Manufactured Housing Institute’s 2018 Congress & Expo will feature speakers, educational sessions, more than 120 exhibits and the prestigious awards ceremony. Taking place at the Paris Hotel in Las Vegas from April 24-26, this all-industry gathering expects more than 1,200 attendees. U.S. Department of Housing and Urban Development (HUD) Secretary Ben Carson is the keynote speaker. MHI has been working to create a more cooperative regulatory environment at HUD for manufactured housing and ensure that Secretary Carson understands its position as a critical source of affordable housing for the nation. Attendees won’t want to miss the Secretary’s remarks, which are sure to address the recent developments at HUD’s Office of Manufactured Housing. Following Secretary Carson, Ducker Worldwide principal Chris Fisher will unveil the findings of the second phase of MHI’s ongoing consumer research initiative. The first phase of the research, which focused on the home preferences of millennials, immigrants and step-down baby boomers, was released at MHI’s Annual Meeting in October. Phase 2 of the research is about how the industry should evolve to market and sell this new type of home. MHI’s General Counsel and Senior Vice President Rick Robinson will present “Fair Housing 101.” This fast-paced session will offer valuable “Best Practices” on how to avoid corporate and personal liability for a costly Fair Housing claim. Other educational topics planned for the MHI Congress & Expo include: • What are Fannie Mae and Freddie Mac Doing to Support Financing for Manufactured Housing? • Hot Topics: Industry Attorneys Answer your Questions. • Challenges and Opportunities with the Tiny Home Movement.

• MHI is Fighting for the Industry in Washington – Learn How You Can Join the Effort. • Matching Current C onsumer Search Trends and Innovations in the Manufactured and Modular Housing Industry. • Community Infrastructure Solutions. • Understanding Current Installation Guidelines. • Disaster Prevention, Preparedness and Recovery. • Filling Sites in Communities. • Looking for Manufactured Housing Education? MHEI Has That. In addition to the Congress and Expo event registration, attendees are encouraged to arrive early and add any of the following events to their experience: • A Trap and Skeet shoot held at Nevada’s 5-star outdoor shooting facility. Sporting clay enthusiasts will appreciate the 23 well-maintained Trap and Skeet fields. • A golf outing at TPC Las Vegas where golfers will enjoy PGA tour quality conditions with lush greens woven among the scenic desert landscape. • The National Communities Council Spring Forum which is a full-day of education and networking focused on operational aspects of manufactured housing communities. • The day-long Developers Seminar that specifically addresses the needs of builders and developers who want to utilize factory-built housing to save time and money, and to provide innovative, affordable options to homebuyers. Registration for the MHI Congress and Expo is online before the event begins or onsite. For registration information and complete details visit www.CongressAndExpo.com. MHV

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Monday, April 23

9 a.m. – Noon: 2nd Annual Hart King / Lutz, Bobo & Telfair Trap & Skeet Shoot at the Clark County Shooting Complex (pre-conference event, additional registration fee required) 1:30 p.m.: 14th Annual Oliver Technologies Golf Open at TPC Las Vegas (pre-conference event, additional registration fee required) – Shotgun start

Tuesday, April 24

7 a.m. – 7 p.m.: Registration Desk Open Sponsored by Capital One Multifamily Finance 8 a.m. – 5 p.m.: 2018 MHI-NCC Spring Forum Sponsored by YES! Communities (additional registration fee required) 8:00 a.m. – 9:00 a.m. – NCC Forum Coffee Hour 9:00 a.m. – 5:00 p.m. – NCC Spring Forum Sessions 8:30 a.m. – 5:30 p.m.: Developing with Manufactured Housing Seminar Sponsored by Champion Home Builders, Inc. (additional registration fee required) 8:30 a.m. – 9:00 a.m. – Coffee “Meet and Greet” 9:00 a.m. – 5:30 p.m. – Developer Seminar Sessions 8 a.m. – 4 p.m.: Exhibitor Move-In 5:30 – 7 p.m.: Welcome Reception in Exhibit Hall Sponsored by Pillar Financial, a Division of SunTrust Bank

Wednesday, April 25

7:30 a.m. – 6:30 p.m.: Registration Desk Open Sponsored by Capital One Multifamily Finance 8 a.m. – Noon: Exhibit Hall Open 8 – 8:45 a.m.: Continental Breakfast in Exhibit Hall Sponsored by Lippert Components 9 – 10:30 a.m.: Welcome and Opening Session Keynote Speakers: Secretary Ben Carson and Chris Fisher Sponsored by Assurant 10:30 – 11:45 a.m.: Morning Coffee in Exhibit Hall Sponsored by KeyBank Real Estate Capital 10:45 – 11:45 a.m.: Educational Workshops Sponsored by Credit Human Noon – 1:30 p.m.: National Awards Luncheon Sponsored by RHP Properties 1:30 – 6:30 p.m.: Exhibit Hall Open Sponsored by RHP Properties 1:30 – 5 p.m.: Afternoon Refreshments in Exhibit Hall 2:00 – 3:00 p.m.: Educational Workshops 3:15 – 4:15 p.m.: Educational Workshops Sponsored by Credit Human 5:00 – 6:30 p.m.: Networking Reception in Exhibit Hall Sponsored by Marcus and Millichap

Thursday, April 26

7:30 – 11 a.m.: Registration Desk Open 8 – 11 a.m.: Exhibit Hall Open Sponsored by Capital One Multifamily Finance 8 – 8:30 a.m.: Continental Breakfast in Exhibit Hall 9 – 11 a.m.: Morning Coffee in Exhibit Hall Sponsored by Lippert Components, Inc. 8:45 – 9:45 a.m.: Educational Workshops Sponsored by Credit Human 10 – 10:45 a.m.: Closing General Session at Exhibit Hall Stage 11 a.m.: Exhibit Hall Closes

CONGRESS & EXPO

Advocating Effectively for Manufactured Housing in Today’s Washington

By Dr. Lesli Gooch, Executive Vice President of Government Affairs & Chief Lobbyist, Manufactured Housing Institute

very day, federal officials in Washington, D.C. make critical decisions that impact the manufactured housing industry. Whether it is changes to the HUD Code or to rules that govern the provision of financing, the policy decisions made in Washington have a direct impact on the ability of consumers to purchase manufactured homes. As the national advocate for the manufactured housing industry, the Manufactured Housing Institute (MHI) is working to ensure federal rules and regulations avoid impeding the industry’s ability to offer quality homes at affordable prices. Even as those who wield power in Washington shifts with each election, and the methods for effective advocacy evolve with new technology, MHI works to ensure the industry continues to have an effective, consistent and unified voice. MHI’s efforts in Washington are focused on improving the supply of manufactured housing financing and ensuring HUD regulations are reasonable, cost effective and do not stifle innovation. In addition, MHI has worked to ensure energy efficiency standards preserve the affordability of manufactured housing and advocated for a continuation of

energy tax incentives. Across all federal agencies, MHI has engaged on policies that impact manufactured housing, including successfully securing HUD’s wholesale review of its manufactured housing program, defeating a $40 million per year tariff on Chinese specialty tires used to transport manufactured homes, and securing an extension of the Energy-Efficient New Home Tax Credit (45L credit). Building on the successes from previous years, MHI will continue its aggressive advocacy to ensure Washington policymakers understand that a robust manufacturing housing market is critical. By engaging with federal agencies and Congress, MHI will seek to expand the supply of manufactured housing by improving the supply of financing for manufactured homes and creating a regulatory environment that fosters innovation and enables the industry to deliver quality affordable homes. MHI will work to update and improve the HUD Code to ensure the industry can deliver quality, state-of-the art and affordable homes to meet the demand of the 2018 market. MHI also keeps fighting against any federal actions that expand regula-

tory programs into state functions, or conflict with accepted building practices. The items below help to further detail these efforts.

Improving the Supply of Manufactured Housing Financing MHI will continue its work to enact legislative and regulatory measures to improve the supply of financing for consumers seeking to purchase manufactured housing. MHI’s legislative and regulatory priorities in this area include clarifying and modifying Consumer Financial Protection Bureau (CFPB) financing rules, requiring Fannie Mae and Freddie Mac to support chattel lending, and improving FHA mortgage insurance programs for manufactured housing. MHI also will continue to support policy changes regarding consumer credit such as the enactment of reforms to the bankruptcy code, seller finance rules and availability of credit through Veterans Affairs and the USDA programs. CONTINUED ON NEXT PAGE

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Ensuring HUD Code Regulations Encourage Innovation and are Cost Effective MHI is working to ensure federal rules and regulations do not impede the industry’s ability to build quality homes at affordable prices. MHI is working to create a more cooperative regulatory environment at HUD and to elevate the profile of manufactured housing within the Department. Through meetings with senior leadership at HUD and the White House, Congressional outreach and support, and letters and Calls to Actions, MHI will continue its aggressive advocacy efforts to improve HUD’s oversight of manufactured housing to support innovation and address areas of regulatory overreach. MHI is fighting against HUD actions to expand regulatory programs that intrude into state functions, reinterpret regulations to the detriment of long-standing and accepted building practices, and implement rules that unnecessarily limit consumer choice. MHI is also working with HUD and Congress to update the HUD Code and Manufactured Housing Construction and Safety Standards Act. Additionally, MHI is working to ensure HUD exercises preemption when local regulatory construction standards and zoning policies adversely impact the placement of manufactured homes in localities.

Making Federal Officials Aware of the Benefits of Manufactured Housing MHI will continue its efforts to increase the federal profile of manufactured housing as an affordable housing solution across the federal government. MHI will seek opportunities with Congress to promote the benefits of manufactured housing at hearings, during floor speeches and debates, and other appropriate venues, as well as serve as a resource for the Administration and Congress about manufactured housing. In addition to HUD, MHI will continue to monitor policy developments across the federal government and engage on all policies that impact manufactured housing,

including activities at the departments of Treasury, Energy, Commerce, and Transportation, as well as the Federal Emergency Management Agency (FEMA) and actions around the National Flood Insurance Program (NFIP).

You Can Help to Support Federal Policy Changes for Manufactured Housing Manufactured housing is the key to homeownership for a growing segment of the population and MHI is here to ensure the industry can seize the opportunity. Because MHI has worked to create a strong voice in Washington, significant progress is being made to Photo courtesy of Zeman Homes

ensure new laws and regulations do not negatively impact our industry’s growth potential. The importance of grassroots outreach is critical for bolstering MHI’s advocacy efforts. Through aggressive lobbying and targeted activation of our grassroots network, together we can get out a coordinated message when it counts to key policymakers. As Members of Congress consider many issues, our voices need to be loud and unified. With your participation, we can elevate the importance of federal policy changes needed for manufactured housing and drown out the misinformation that is being disseminated from those who lack understanding of the manufactured housing market. We can ensure policymakers understand the importance of manufactured housing as a critical resource for working families and as the largest form of unsubsidized affordable housing in the nation. There is strength in numbers, and thanks to MHI’s growing membership

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we have been able to make an impact. Our voices are being heard loud and clear. In 2017, more than 10,000 contacts were made by advocates to their Members of Congress and federal agencies about legislative and regulatory changes needed to support manufactured housing. This outreach resulted in several accomplishments including HUD undertaking a comprehensive review of its manufactured housing program. Prior to this critical action by HUD, MHI and its members contacted Members of Congress and the Administration to stop HUD’s expansion of its regulation of manufactured housing. This outreach culminated in an amendment that was unanimously passed by the U.S. House of Representatives to prohibit HUD from using any of the funds made available by Congress in Fiscal Year 2018 to implement, administer, or enforce the recent over-regulation of add-on garages and carports, new frost-free foundation requirements, and onerous new requirements for the on-site completion of construction. Grassroots outreach also has been instrumental in supporting MHI’s efforts to make changes to federal regulations that have reduced the availability of financing for manufactured housing. The Preserving Access to Manufactured House Act (H.R. 1699/S. 1751) was passed by the U.S. House of Representatives in December 2017 and the bill’s language was included as a part of a larger financial reform package (H.R. 10), which passed the House in June 2017. In September 2017, the House passed the bill’s provisions as a part of its Fiscal Year 2018 Appropriations package. The Senate’s financial regulatory relief package (S. 2155) also include a key tenet of H.R. 1699/S. 1751, by excluding manufactured housing retailers and sellers from the definition of a loan originator so long as they are only receiving compensation for the sale of a home.

How to Become a Grassroots Advocate for the Industry The commitment required for you to add your voice to MHI’s advocacy CONTINUED ON NEXT PAGE

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effort can range from a couple of clicks on your computer to send a message, to a one minute phone call, to visits to an elected official in the district or in Washington, to developing long-standing relationships with your elected officials and their staff members. We urge you to participate to the extent you are able, as there is strength in numbers. We believe you will find the experience of engaging with your elected officials impactful, interesting and rewarding.

Again, we make that process easy for you and include simple talking points for you to make during your phone call.

Get to Know Your Member of Congress at Home Members of Congress like to know their constituents and spend a considerable amount of time seeking feedback from them and opportunities to visit with them. There likely is a congressional office close to where you live or work. During “district work periods” Representatives and Senators are not in Washington, D.C. voting. Instead, they are working from their district offices in the communities they represent. These work periods provide a great opportunity for you to talk to legislators about the benefits of manufactured housing. MHI will provide you with key talking points to make this process enjoyable and easy. We can even help you set up a meeting if you need assistance.

Respond to MHI’s Calls to Action With MHI’s advocacy page, we make contacting your Representative, Senators and regulators easy. It only takes a few simple clicks and your voice can be heard. MHI composes the letter for you, which you can edit as appropriate. All you have do is insert your contact information and click submit. When votes in Congress are imminent, MHI might ask you to make a phone call.

CONGRESS & EXPO

Contribute to MHI’s PAC Campaign fundraising is an essential element in today’s political process and to the success of any national trade association’s advocacy efforts. Political action committees (PACs) are an important tool that allow association members to have a voice in elective politics. MHI-PAC helps to ensure that our industry has a voice and that pro-manufactured housing Democratic and Republican candidates are supported. MHV Dr. Lesli Gooch is the executive vice president of government affairs and chief lobbyist of the Manufactured Housing Institute in Arlington, Va. MHI is the only national trade organization representing all segments of the factory-built housing industries. MHI members include home builders, lenders, home retailers, community owners and managers, suppliers and more than 50-affiliated state organizations.

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CONGRESS & EXPO

Photo courtesy of Zeman Homes

A Word from the State Association Directors Also Included in This Section: Ronald Breymier C. Jay Hamilton Joan Brown Lance Latham Sheila Dey D.J. Pendleton Mary Gaiski William Sheffer Jennifer Hall Ken Anderson

Amy Bliss

Frank Bowman

What is the most relevant trend you see occurring in your state? “New players entering the industry, purchasing our small, aged communities. The challenge is getting them educated on the laws that govern not only the management of land leased communities from a state perspective, and the selling and installation of manufactured homes within the communities. These are unique to each state. Without this education we are seeing a lot of frustration on the part of these new owners and our state and local officials.” Mary Gaiski, Pennsylvania Manufactured Housing Association “Definitely the role that social media is playing, especially from a marketing standpoint. Facebook and Instagram allow manufacturers and retailers to micro-target potential homebuyers and give them a taste for the homes before they even step foot on the retailers’ lots. Social media also allows associations like ours and other advocacy groups to answer consumer questions and address consumer concerns and misconceptions in a direct way while also marketing the industry as a whole – and all of this can be done for a fraction of the price of traditional media sources, which allows retailers and associations of any means to still be able to effectively reach target audiences.” Lance Latham, Alabama Manufactured Housing Association

Mark Dillard

Craig Hillis

Betty Whittaker

“During 2017 the Arizona State Legislature passed a bill allowing Real Estate brokers and salespeople the right to list and sell both new and pre owned homes within land lease communities. It’s too early to measure the impact of the program but our community owners are excited about the potential of our affordable homes appearing in multiple listing services throughout the State. Our 2018 State Legislature has a new bill being considered (H.2150). This bill allows Real Estate professionals the right to list and sell new manufactured homes on private property. Current statute allows the sale of pre owned homes on private property only. The real estate industry worked in concert with the Manufactured Housing Industry of Arizona in writing the bill. In all cases, the Real Estate industry personnel must work through a licensed MH retailer. Because of the MLS exposure, we as an industry feel there will be greater acceptance and credibility for our factory built homes.” Ken Anderson, Manufactured Housing Industry of Arizona “Our number one priority right now is securing factory labor, not looking at any one facility or manufacturer, but on the whole. We are quoting 15-20 week delivery times, and there are others that are longer. That’s half a year, and one of our biggest advantages as an industry is speed to market with a customized order. We’ve lost that, and that’s always brought us business that we may not

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Tim Williams

have otherwise had. The other concern I have is that plants because of a lack of labor are working at 65-70 percent capacity, and we know that’s costing us business. People in that situation are going to get a condo, rent an apartment or buy a site built home. And it’s costing manufacturers who spent their reserves when the market was down, and we need to be able to maximize those profits when the market turns. We’ve not been able to do that.” C. Jay Hamilton, Georgia Manufactured Housing Association “We are at a crossroad. The manufactured home industry in South Carolina is in a good place right now. Shipments for South Carolina have increased by double-digit percentages for four straight years. The state has a strong retail base. They are people who follow good business practices and provide excellent customer service. They see the manufactured home industry as a long-term career. “Oddly, the downturn is one of the reasons for the quality of the retailers we have right now. Many of the best dealers survived the downturn because they had the advantage of referral and repeat business. They had treated their customers well and were rewarded. “The challenge for our industry in the next few years is to avoid what happened in the 1990s. We not only had too many CONTINUED ON NEXT PAGE

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retail centers for the amount of sales, we also had people come into the industry who were under-capitalized or who just wanted to come in and make a killing. There wasn’t much done in the way of background checks. The fly-by-nighters were involved in many of the inaccurate loan applications that resulted in repossessions and, ultimately the loss of a secondary market for our loans. The state laws now in place can keep the bad apples out. If our state agency will take a pro-active role in screening license applicants, that will make a big difference.”

sales, but in order to compete, we must be in a position to deliver our product to the consumer in a timely manner. The Indiana MHA is working with the Indiana Department of Veteran Affairs, National Guard Association of Indiana and the Department of Workforce Development to help recruit and employ veterans and members of the National Guard. We also are working with the current administration to find ways to attract workers from other states to Indiana and help them build their lives and families in well-paying careers in our industry.”

Mark Dillard, Manufactured Housing Institute of South Carolina

Ronald Breymier, Indiana Manufactured Housing AssociationRecreation Vehicle Indiana Council

“Everywhere you go people are talking about the need for affordable housing. But nobody knows exactly what that means. The industry needs to grab the phrase away from the subsidized housing crowd and make it its own.” Frank Bowman, Illinois Manufactured Housing Association “One of the greater changes we see in Indiana is the nearly total transition from MHs being sold from traditional dealerships, to sales emanating from inside MH commu-

“One of the biggest things we’ve experienced recently has been our work on Duty to Serve with Freddie Mac because our state was designated as one for a pilot program in regard to creating secondary markets for financing. We toured around with representatives from Freddie in December of 2016, and it was eye opening for them I think to see what we’re producing and what some of the new homes on retail lots look like. “One of the things we’re doing is referring people who are having difficulty buying a home to an online tutorial called e-HomeAmerica that does credit counseling and provides direction for how to get on the path for purchasing a home.” Betty C. Whittaker, Kentucky Manufactured Housing Association

Photo courtesy of Zeman Homes

nities. This phenomenon led to the passage of 2017 legislation in Indiana to put MH dealer licensure back in Indiana law, rather than on a voluntary basis. Anyone selling more than 12 homes will need to be licensed dealers. This is leading to new rules and regulations that will streamline and simplify requirements for dealers selling from within MH communities. From a manufacturing basis, we need to attract more people to our industry so we can keep up with the growing demand for our homes. We are blessed with a steady rise in orders and

“Available financing will come eventually from Freddie and Fannie for people who want to buy a home where they’ll be paying a rental fee for space. Until this financing lends itself more to people who have a small loan need, we won’t be able to appropriately satisfy the housing requirements of a large number of our state’s residents. But, we’re getting closer to that, I think.” William Sheffer, Michigan Manufactured Housing Association “Looking forward it’s really the continued education about what manufactured is, from a Facebook advertising campaign, talking about energy efficiency or big campaigns. My hat’s off to Clayton for the campaigns they’ve developed. That message was loud and clear about what manufactured housing

CONGRESS & EXPO

today is, and a lot of people don’t see that, they just haven’t been introduced. “There is a huge market out there that I think doesn’t really understand all that’s available, and we as an association and industry have to continue to market and get that message out there. What I think we’re seeing is an industry recovering from a pretty difficult time, and when there was a lull there in advertising. And to all groups, including millennials, we need to express how many needs we can meet with what can be an amazingly self contained and low maintenance home, sometimes with a smaller footprint. We just always have to be open to change and listening to what the public wants. There is not one size fits all, you build what people want. And our industry, guess what, you can build something very affordable or something very elaborate. Our skilled trades are doing it every day.” Jennifer Hall, Mississippi Manufactured Housing Association “The long climb out of the housing recession has suddenly broken out into strong consumer demand and booming sales. Almost immediately the industry turned to the problem of long home production back-logs. Manufactured housing builders, as with all fields of construction in the northwest, are struggling to find and keep qualified workers and to increase production. The northwest manufactured housing market has always been almost exclusively a higher-end, multi-section, residential-looking home market. The recession brought an emphasis on lower-cost, but today’s buyers have resources and are demanding custom-designs and features seen in more expensive site-built homes.” Joan Brown, Northwest Housing Association (Washington) “We’re seeing a continued increase in larger portfolio owners coming into the industry and that has resulted in a lot of parks being upgraded and has generated increased sales We probably will have about 2,000 annual new home sales statewide compared to about 500 not more than five or six years ago. CONTINUED ON PAGE 36

MHINSIDER.COM • APRIL 2018 • MHINSIDER™ |

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“In the eastern and southeastern part of the state there’s been a boom in the natural shale oil industry. People are buying in that region very aggressively. We get a lot of calls from investors looking to buy parks, and also some of the company owners in the oil industry searching for workforce housing. “Clayton has an increased presence in the state, probably driving about 40 percent of the sales here. Skyline also has a big presence, and Champion and Adventure also seem to be doing well here.” Tim Williams, Ohio Manufactured Homes Association “The biggest trend we are seeing is the affordable housing squeeze. Last week I attended a conference by the Federal Reserve Bank of Dallas regarding the affordable housing issues facing Texas. The big ticket takeaway is that affordable housing demand is at an all-time high with limited and shrinking supply. And things are only expected to get worse. The conference attendees of academics and housing providers unable to point to a single solution and deferred the problem to one of complexity needing a complex set of solutions. But the data and facts are undeniable that solving the affordable housing demand is critically important, within which manufactured housing has an opportunity to play a major role. “It was recently offered that the best data point to look at for this reality and trend are the rental rate increases for Class C apartments. This category of apartment leasing rates has increased far more substantially in both amount and percentage increase relative to all other housing costs. Among other trends we see, but are uncertain as to the impact, is the now-rising interest rates. Rates have been at historic lows for a long time now and are finally moving up. The impact from rising rates is uncertain. Rising rates could help those in lending, but will increase home costs across the board. This might have a positive (so inverse) impact on MH if buyers on the margin are priced out of site built and con-

sider MH. But as much as I’d like it, I’m not expecting large numbers of buyers flocking our way due to rate increases simply because while rates have been historically low, credit standards and home prices have been such that the vacuum of a moderate to lower income buyer was already out of the site built markets and forced to consider other options. So rates increasing or not, I’d expect the same trends we were seeing with low rates and tight credit to be the same with higher rates. “There is still a bunch of capital moving into the Texas MHC market. There are lots of acquisitions and prices for MHCs continue to rise. Cap rates on MHC deals continue to shrink with price increases. But I wish I had a reliable crystal ball to tell me if a price bubble is occurring that will eventually correct or if prices continue to increase such that an economic case can once again be made for creating new communities from scratch. Currently, the best I can see is more of a ‘fence straddling’ with many existing MHCs undergoing large expansions. Finally, the impact of the new tax law is also still up in the air, but it will have many impacts in the

program that has been used to push high levels of apartment construction in years past because the lowering of the corporate rate from 35 to 21 percent. The lower rates dismisses the attractiveness of further lowering it by investment in tax credits.” D.J. Pendleton, Texas Manufactured Housing Association “The most relevant trend we see in Washington is the overall decline in new manufactured housing communities being built. Due to growth management, land to build a new community is very expensive since land to build is restricted to multi-family zoned property within the growth management act. We need more land areas to build outside the GMA.” Craig Hillis, Manufactured Housing Communities of Washington

“For us it’s rent control. It’s being addressed as an initiative at the state level, and then in local governments all across California. We have not built enough housing for the last 30 years in California, and we need to fill at least 150,000 units per year to catch up and we haven’t been doing that for decades. We have have 57,000 homeless people in L.A. We don’t have enough affordable housing and we aren’t building enough. The conclusion that the legislature comes to is that when there’s a shortage, prices increase. The solution they think is to pass rent control, but it doesn’t address the problem. Rent control doesn’t create more housing. Rental property owners throughout the state are under siege. We have a vacancy rate in most parts of California is 1 percent. In San Francisco it is nothing, Photo courtesy of Sun Communities and the average one bedroom apartment there is $3,000. We have a state wide initiaive near term. The basics of entity structuring circulating to repeal local governments’ and acquisition timing will be influenced by ability to return to market values as a rent the new 20 percent pass through deduction. control tenant moves out. We are lobbying As well as other areas, for example I heard them on it, but it’s difficult. There’s nowhere at the conference the demand of tax credits to live, and there are so many regulations has significantly declined and with it invest- and fees involved with building anything, ment into low-income housing tax credit CONTINUED ON PAGE 38

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it drives people away. You can’t have any reasonable way to gain return on investment at a reasonable price, so no one is building anything but luxury apartments.” Sheila Dey, Western Manufactured Housing Communities Association “In Wisconsin, the most relevant trend is community owners becoming licensed dealers. Most of them are undertaking this activity in order to place new homes on vacant sites. They are then either selling the homes or renting the home and the lot. In the past, the practice of renting out a home was almost unheard of; community owners did not want the responsibility for home maintenance and remodeling homes after a bad tenant caused damage to the home. It is now common practice for several reasons: 1. After the economic downturn, very few ‘street’ dealers were left. 2. The lack of financing created a situation in which dealers and community owners no longer worked together to put homes on vacant lots, and 3. The economic downturn forced more multi-generational household formations which created little demand for homes. “Another trend that I am seeing in Wisconsin (and am very thankful to see), is increased demolition of older homes. With larger investment groups coming into our state to buy manufactured housing communities, they are investing in removing old homes and replacing them with new homes. That is a very welcome and needed trend that I hope continues. Communities that have been in around since the 1960s definitely were in need of a facelift and some infrastructure upgrades.” Amy Bliss, Wisconsin Housing Alliance/Wisconsin RV Dealers Alliance

What do you see as the greatest opportunity industry/ nationwide this year? “Due to the promise of Fannie and Freddie’s new programs, we are encouraged more lenders will enter our industry creating competition, which will increase chattel sales for our retailers and help speed up the revival of our land lease communities.” Mary Gaiski, Pennsylvania Manufactured Housing Association

Photo courtesy of Equity LifeStyle Properties, Inc.

“The biggest opportunity is the changes coming at HUD and Fannie Mae and Freddie Mac, followed closely by the tax cut legislation passed late last year. These changes will speed up delivery of the homes, make homes more affordable for the homebuyers, and create financing options for homebuyers that have been limited or nonexistent before now. All of this together makes for a bright future for the manufactured housing industry and our customers.” Lance Latham, Alabama Manufactured Housing Association “Without question the greatest opportunity for the entire industry will be the passage and signing of the Dodd-Frank/ CFPB legislation. For the first time in over seven years we have a favorable political climate to gain passage. This is one of the few bills going through Congress that is indeed non partisan. Already through the House and Senate banking, it appears to be moving forward for a positive full Senate vote and then onto the White House. Passage will be a big boost to our retailers to give them the opportunity they lost, to directly communicate with a consumer on some financial matters. The bill also relaxes both rules and yields for our chattel financing to improve profit potential with less liability for our lenders.” Ken Anderson, Manufactured Housing Industry of Arizona “I think the greatest opportunity for us at this time is a pair hand-in-hand, which is the image we project and how that impacts the

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financing we have available in our industry. We continue to try and attract consumers with low or no down payments, or skip your first three payments and other tired cliches and we wonder why we have insufficient financing in the industry and occasions of low performance of portfolios. It draws consumers who need to be in a better place to buy a home, and forces us to deal with the bottom segment of the available market. You get what you advertise for, and even though our product has changed we still seem to operate on the most ill-prepared of our consumers. Just one of the overall things we could do in attracting regional financing is to improve the status of consumer we pull to our sales centers.” C. Jay Hamilton, Georgia Manufactured Housing Association “Factory-built housing is on the verge of an explosion. The general lack of trades people and the economy associated with production will work to fill a much larger market share moving forward.” Frank Bowman, Illinois Manufactured Housing Association “Everybody in the industry hopes that we can push back against HUD overreach at the federal level. Sen. Tim Scott from South Carolina has been one of our industry’s primary advocates in getting HUD to revisit its whole approach to regulating manufactured housing. CONTINUED ON NEXT PAGE

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“I think there is an opportunity for the individual state associations to do the same thing. HUD has been ‘legislating by letter’. That refers to the audit letters the agency sends to the State Administrative Agencies (SAAs) in the individual states. We think they are exceeding their statutory authority in what they are telling the states to do. We asked our state regulatory board to slow down the train and take a close, hard look at what HUD wants to require in areas such as installation. The state agency board voted in December not to implement a state regulation incorporating every change outlined in the HUD audit letter for South Carolina. Instead the agency is going to go back to the drawing board and revisiting the whole issue in the coming months. They’ve asked MHISC to work with agency staff to come up with regulatory amendments that will be reasonable.” Mark Dillard, Manufactured Housing Institute of South Carolina “The industry’s best opportunity is in a combination of millennials who want affordable housing and the Baby Boomers who wish to downsize. Our industry is well positioned to provide both with quality attainable housing. No site builder is catering to the market below $200,000. Our industry can give them the home they want with the amenities they desire in a land-home package in the $100,000 - $125,000 range. Additionally, I see a rise in demand for our land-lease communities where our homes and pricing beat apartment living costs. This

could grow at a greater rate if we get more financing for chattel loans for our homes. Improved consumer financing will be a critical building block.” Ronald Breymier, Indiana Manufactured Housing AssociationRecreation Vehicle Indiana Council “What I see that continues to be the primary hang-up in the industry is the perception of manufactured housing. There remains such an outdated, at least, if not an entirely false narrative, about this much-needed segment of housing. “A county or city will zone out manufactured housing, or require 10 to 15 acres before a home can be sited. It continues to be very frustrating that consumers cannot buy and place a manufactured home in some areas simply because they are built in a factory. We are in the process of starting to help members with this issue and fight for fairness.” Betty C. Whittaker, Kentucky Manufactured Housing Association “We’re receiving more questions at the association office from people looking for 55+ communities. We’re also receiving calls from community owners who are contemplating switching to a 55+ community. “It’s about the demographics in the state. We have Baby Boomers as every state does, and there are a lot of considerations for the amenities and lifestyle choices for that market. This is a big step, not the least Photo courtesy of Equity LifeStyle Properties, Inc.

CONGRESS & EXPO

of which is considering how many people you might displace. And you can’t change your mind and go back.” William Sheffer, Michigan Manufactured Housing Association “A lot of families just really love that that can choose what they want, a single section or multi-section home with all the features they want. We’re still very much a rural state, and you can buy land at a relatively reasonable price. And you can put a manufactured home on that land.“In Mississippi what we see is a lot of people who live in the country, they have parents who become elderly, and they can put a single section home on the property within view of their home home so parents can have independence but are close enough to look after and check on. That’s a really good option, and one that’s more economical than assisted living. A HUD home with a little cottage porch built to ADA standards can do a lot. “The other side is young couples getting married and putting the home on an acre of land as a starter home. They may expand it or get a multi-section home when they start to have kids. There are a variety of floor plans so you can have the bedroom for parents on one side of the home and the children’s on the other. Special orders offer a lot more to the customer than going to pick something off the lot. Manufactured housing is not transitional housing, it’s a house for life and a house for living.” Jennifer Hall, Mississippi Manufactured Housing Association “In Washington State the disparity between site-built housing costs and manufactured housing costs continues to grow. There is a huge market opportunity in that gap where home-buyers can’t afford the escalating site-built costs, but don’t want to even consider a home advertised for the price of a car. The industry can provide the home features and will have to step up to the quality and customer service those buyers will demand.” Joan Brown, Northwest Housing Association (Washington) CONTINUED ON NEXT PAGE

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“The key issue is financing. More lenders have come in, and there’s been some broadening of financing, but if we can get a hold of what we’re doing legislatively in term of what we’re doing with government backed loans it will help a lot. It seems like MHI has been doing a lot to drive this, and I think ultimately will be effective.” Tim Williams, Ohio Manufactured Homes Association

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“All that we are seeing and hearing is that the demand and sales for manufactured homes in the $85,000 and below markets will continue to be strong. We believe 2018 will be better than even a great 2017 in terms of MH shipments and production at these typical price points. The opportunity for our industry is to figure out how to expand our role in housing to that next level of home price point. Going back to the affordable housing demand, as it was recently described, new construction site-built homes under $200,000 are ’extinct’ and those under $250,000 are an ‘endangered species.’ If the industry can successfully remove the regulatory barriers holding back all our brilliant thinkers, designers, engineers and architects to allow them to innovate a new aspect of factory built housing to play an increased role, with the goal of soon being a dominant role, in the sub-$200,000 home price point, we will have a real opportunity to serve a massively underserved area of the home buying market. I do think that while the millennials are delaying until later in life significant life milestones (marriage and starting families), they will get there. They will get married, have kids and when that starts to happen, the one-bedroom apartment they are in (or basement of their parents’ house) is going to get cramped. And for many, especially those with long-term debts like college loans, they will need an affordable home option. If we can crack this market while staying true to our typical MH ‘bread and butter’ markets, then look out. We could see factory built housing finally work to fill the large and widening gap in affordable and even moderately priced housing in this country.”

mobilehomedepotmi.com 40 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

D.J. Pendleton, Texas Manufactured Housing Association

“In my opinion, we have the opportunity to educate people that new manufactured homes in many cases are better built than many site-built homes.” Craig Hillis, Manufactured Housing Communities of Washington “I’m optimistic with this effort to examine HUD code and how we can improve it. That’s significant for an industry as a whole.” Sheila Dey, Western Manufactured Housing Communities Association “The greatest opportunity the industry has this year is to form a relationship with HUD that facilitates the industry’s ability to innovate. If we can move from a place of excessive regulatory burdens and unnecessary paperwork to a partner for providing affordable housing, the sky’s the limit for the manufactured housing industry. The economy is improving, affordable housing advocates are starting to appreciate the industry and our engineering is nimble if HUD starts to see us as a partner rather than a punching bag. “Another opportunity I see is the possibility of getting reasonable financing terms for chattel loans. If that happens, I see an amazing year for the industry.I would also like to address what I see as the greatest threat to this industry. In my opinion, having competing voices and divisive agendas is harmful to the industry’s reputation with legislators and regulators. No matter what segment of the industry is being represented, we all rise and fall together. Manufacturers need communities, dealers and finance companies to thrive and visa versa. There is no pre and post production industry, we are all one industry that must work together to fulfill the potential of the industry. “Drama and innuendoes have no place in industry publications. It only serves to give the entire industry a black eye. The promised professionalism and positive outlook of the MHInsider publication is very refreshing.” Amy Bliss, Wisconsin Housing Alliance/Wisconsin RV Dealers Alliance

CONGRESS & EXPO

The Power of Industry Training

skilled workforce is a competitive advantage and one of the keys to success and longevity for any company. Keeping people trained and providing training opportunities is important but also can be a challenge. But there are industry classroom and online training programs that offer certificates and designations that are viewed as a badge of accomplishment and excellence. The Manufactured Housing Educational Institute, the educational arm of the Manufactured Housing Institute, offers both online and classroom training for the industry in three areas: Accredited Community Manager (ACM) Designation, the Professional Housing Consultant (PHC) Designation and Manufactured Home Installation and Inspector training. MHEI recently updated its Accredited Community Manager (ACM) Designation and Manufactured Home Installation programs. The courses are more streamlined

with case studies, real-world examples and taught by respected industry experts. The Manufactured Home Installation online training provides flexibility for participants to take courses at their leisure, 24/7, depending on their schedules. Photo courtesy of Rickert Properties

Employers also benefit. Krinzman added, “For employers, investing in employees by providing them with opportunities to improve their skill level shows them their contributions are valued. The payback can be increased productiveness and a solid bottom line.”

Here’s What MHEI’s Offers:

“Continuing education is important,” said Lee Krinzman, MHEI’s executive vice president. “Employees who continue to learn, develop their professional skills, and expand their knowledge often have more opportunities for advancement. They also benefit from networking with their classmates and develop long-term relationships.”

MHEI® Accredited Community Manager (ACM®) Designation Program The Accredited Community Manager (ACM®) is sponsored through MHI member associations and/or companies that own and operate manufactured home communities and are members of their state associations. The ACM® program consists of two courses, the first lasting three and one-half days and the second lasting two and one-half days. CONTINUED ON NEXT PAGE

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The ACM® program is a comprehensive study of manufactured home community management topics. This program covers a broad range of manufactured home community management topics to include: management and resident policies, community maintenance, leasing and sales techniques, marketing communities, taxes, insurance, financial management, business planning, physical asset management, federal laws and fair housing law. The program consists of two courses which must be taken in order. Professional Housing Consultant (PHC®) Designation Program MHEI® has recently updated the curriculum for the Professional Housing Consultant (PHC®) designation and soon will be making the courses available online in distance learning formats. The PHC® courses are designed for employees of retail sales centers and land-lease communities that conduct onsite home sales. The Professional Housing Consultant course contains the history of the industry, information about the HUD Code, financing methods including both land/home and personal property (chattel) loans, retailer responsibilities, how homes are built and installation of the homes. There are many other topics included in the industry overview. Manufactured Home Installation MHEI is the place to go for manufactured home installation. The online courses are taught by George Porter of Manufactured Housing Resources. Together, MHEI and Porter have created the online training program. With humor and detailed explanations of the installation process, these courses will take the installer from the first to the last step of installing a manufactured home. MHEI plans to offer webinars later this year on several topics, including fair housing. MHEI hopes to have all its training and designations available online in the next year. Visit http://www. manufacturedhousing.org/education/ for more information about industry training or contact Lee Krinzman at LKrinzman@ mfghome.org. MHV 42 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

Innovative Program Trains Entry-Level Workers for Construction Careers MHI works with the nonprofit Home Builders Institute (HBI) to address the labor shortage and provide entry-level job candidates who are ready to begin work immediately.

placing them in construction careers. Its Pre-Apprenticeship Certificate Training curriculum is one of only three U.S. Department of Labor-recognized pre-apprenticeship curricula. Certificates include brick masonry, building construction technology, carpentry, electrical wiring, heating, ventilation and air conditioning, and plumbing.

Here’s What You Can Do:

HBI works with the building industry to train and place qualified, skilled workers in entry-level jobs once they successfully complete a 14- to 16-week training program taught in nearly 300 centers across the country to military veterans, transitioning military members, at-risk youth, justice-involved youth and adults, and displaced workers. HBI training programs include Job Corps, Military and Veterans and Re-Entry & Community Re-Integration. HBI’s program is unique in that it supports students through every step of the employment continuum - assessing candidates, training, certifying and

• Go to HBI.org to learn more about HBI training centers. Find one near you and contact them for specific information. • List job openings on the HBI Industry Job Board so students and graduates can learn more about the positions and you as an employer. • Offer to be a guest speaker in the classroom and host a factory tour so so students can learn more about the exciting careers in manufactured housing. For additional details, contact David Howard, HBI’s Chief Development Officer, at dhoward@hbi.org or visit HBI’s website at www.hbi.org. MHV

Join MHI in Washington, D.C. in June at its annual Legislative Fly-In To join MHI’s advocacy efforts in 2018, members are encouraged to attend MHI’s Legislative Fly-In program from June 25-26, 2018, in Washington, D.C. This is a perfect opportunity for the industry to tell its story to members of Congress. With your participation, we can ensure all members understand the importance of manufactured housing as a critical resource for working families and the largest form of unsubsidized affordable housing in the nation. The 2018 Legislative Fly-in program includes: • Meetings on Capitol Hill with your members of Congress or their key staff • Lunch on the Hill with presentations by members of Congress • Networking with your MHI peers from across the country • Briefing sessions on MHI’s legislative priorities • Training on lobbying and influencing your elected leaders • Tips on continuing relationships with your elected officials once you return home

Photos courtesy of the Las Vegas Convention & Visitors Authority (LVC&VA)

CONGRESS & EXPO

Las Vegas Events and Attractions: Beyond the Casinos By Juliana Ludema, Contributor

ou know the casinos and hotels, but there’s more to Vegas than trying your luck at Blackjack. There’s so much to see and do, you might just have to extend your stay into the weekend! Make sure to check availability online ahead of time, as some of these attractions require you to purchase tickets.

For Group Sales: For information, contact the Citywide Attractions Group Sales Team at (702) 322-0537 or by emailing CitywideAttractions@caesars.com.

Exhibits and Festivals Great American Foodie Fest

Above the Venue Before catching a dazzling Vegas show, consider checking out one of the events or opportunities available to you this week: The Eiffel Tower Experience Lift yourself above the lights and commotion of the Las Vegas strip with the one-of-a-kind Eiffel Tower Experience. An iconic landmark on the city’s skyline, this attraction is 46 stories up and provides 360-degree views of all that happens below. The half-scale replica of the famed French tower is an ideal venue for date nights and photo ops. Especially romantic at night, the views of Vegas

Photo courtesy of the LVC&VA

are unmatched. Have dinner on the 35th floor and stop by the Total Snapshot kiosk to purchase a commemorative photo of your “France in Vegas” experience above the strip. It’s a perfect keepsake for an unforgettable moment. https://www.caesars.com/paris-las-vegas/things-to-do/eiffel-tower

Head to Sunset Station this weekend, Thursday to Saturday, and you’ll find some of best gourmet food trucks in the country -- many have been featured on the Food Network, the Cooking Channel and the Travel Channel. Past vendors include Cousins Maine Lobster, Nothing Bundt Cakes and Jogasaki Sushi Burrito. The event also will feature carnival rides, a beer garden, food competitions and more. For more information visit greatamericanfoodiefest.com/las-vegas Mopars & Muscle Cars at the Strip Do you hold a passion for the good, ol’ American Muscle car? Head to the Las Vegas Motor Speedway this weekend, CONTINUED ON NEXT PAGE

CONGRESS & EXPO

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Photo courtesy of the LVC&VA

Friday to Sunday, to see your favorite Mopars, GMs and Fords compete in drag racing, autocross, pony car races and more! You can even get up close to your favorite cars at the MoPower Cruise and Manufacturers Midway, or catch some tunes at the Cannery Concerts. To register and learn more visit matslv.com Samurai: Armor from the Ann and Gabriel Barbier-Mueller Collection You don’t have to be a military history buff to enjoy this exhibit. The samurai weren’t just warriors; as aristocrats, they were poets, calligraphers and philosophers who developed their own culture, influencing the greater Japanese culture for centuries. You’ll see more than 50 pieces of armor, from the 16th through 18th centuries, while experiencing the samurai’s art, culture and lifestyle. The exhibit is at the Bellagio Gallery of Fine Arts, from 10 a.m. to 8 p.m. daily, until the April 29. For ticket information visit bellagio.com

Local Attractions

time, himself a former criminal defense attorney who represented many reputed mobsters, took the case, suggesting a museum to document organized crime in the U.S. Exhibits include a wall from the St. Valentine’s Day Massacre, an electric chair and otherwise hard-to-access photos of the “mob’s greatest hits” -- those slain as the subject. Learn more and purchase tickets at themobmuseum.org. Vegas might conjure up more images of cocktails and martinis than fine wines, but if you’re a wine person, you’ll find a home at the Rio Wine Cellar and Tasting Room. With more than 100 wines-by-the-glass to choose from, you’re sure to find a unique cabernet or moscato to tell your friends about (there are options for drinkers of the spirits, too!). The Wine Cellar boasts cult wines, global collectibles and an 1800 madeira from Thomas Jefferson’s cellar. Learn more at caesars.com. If you had a little too much fun last night, taking a stroll in the bright sun of the Fresh52 Farmers & Artisan Market might help you see more clearly! Inhale the fresh smells of baked goods and seasonal produce, run your hands over handmade crafts -- and exhale last night’s excesses, if needed. Support Las Vegas locals at their Inspirada-Henderson location on Saturday or their Eastern-Henderson location on Sunday. For hours and vendors visit fresh52.com.

From gambling chips to how-to books to memorabilia, the Gamblers General Store has everything you’ll need to get a leg up in Roulette tonight. Located on Main Street, this 8,000 square-foot store is home to the largest collection of gambling books in the world -- you’re sure to find a souvenir or two! Learn more at gamblersgeneralstore.com. Housed in Las Vegas’ former courthouse and post office, the Mob Museum opened in 2012, after a decade-long restoration initiative. In 2000, the federal government sold the courthouse to the city for $1, asking that it be used for cultural purposes. The mayor at the 44 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

Photo courtesy of the LVC&VA

Since 1951, the deserts just north of Las Vegas have been home to the Nevada Testing Site, where, between 1951 and 1992, the U.S. tested more than a thousand nuclear weapons. Learn the history and global influence of this site at the National Atomic Testing Museum. You’ll see nuclear testing equipment and step into a simulator, where you’ll feel the earth shake, just as if you were watching a nuclear test. Learn more at nationalatomictestingmuseum.org. Photo courtesy of the LVC&VA

Just 17 miles west of the Las Vegas strip, take another breath of fresh air and explore the desert at the Red Rock Canyon National Conservation Area. Here, you can take a 13-mile scenic drive, horseback ride, rock climb or simply hike across Aztec Sandstone cliffs, called “escarpments.” Perhaps you’ll end your stay in Nevada watching an orange sunset sink beneath these rust red rocks. Learn more at blm.gov. MHV

CONGRESS & EXPO

WeatherCall Teams Up with MHI to Provide Community Alerts Manage Your Risk – Master Your Message MHI announces a partnership with WeatherCall Services, LLC, to provide HazardCall. This important, affordable service saves lives and gives community owners and residents a way to instantly communicate on any topic. Free weather apps seem to be everywhere these days; from media outlets trying to get you to click on advertising links to the federal government Wireless Emergency Alerts (WEA). Each have varying degrees of functionality and effectiveness that may not be immediately apparent. HazardCall has been thoroughly vetted for accuracy and reliability by MHI. It was developed by the premier company in weather notification technologies WeatherCall® - which has an 11-year track record of saving lives. HazardCall is different from any other notification service on the market because in addition to sending texts and emails, it calls residents when potentially

life-threatening storms are headed for their specific location and when you must get their attention. Residents receive specific instructions on what to do, such as “seek the best available shelter immediately.” Most notifications from weather apps go unnoticed, but HazardCall’s urgent phone calls are designed to disrupt the recipient so they will take immediate life-saving action.

HazardCall’s Community Message Feature

HazardCall’s Community Message features lets community owners and managers instantly reach all their residents via text message and email with important information about anything from road closures to gas outages and power restoration. Community Message lets on-site managers create and deliver messages from any digital platform. An optional Community Watch feature allows residents to keep each other informed about safety concerns in the neighborhood.

HazardCall is the only service that delivers official National Weather Service (NWS) extreme weather warnings and advisories, via phone calls when danger is imminent and the situation is urgent. It costs between 22 and 30 cents per community site per year. The community purchases this service, and then provides residents with access to a downloadable app. Even those without smartphones can receive life-saving phone calls on a landline phone or by email. “HazardCall is not one of the hundreds of worthless ‘free-apps’ in the marketplace because it is accurate, reliable and tested. These are watches, warnings and advisories from the National Weather Service,” says Brad Huffines, Chief Meteorologist of WeatherCall Services, and FEMA instructor of emergency public information. “For 10 years, I have staked my family’s lives on our company’s services in some of the most dangerous regions in the nation. Would you stake your family’s life on free? I wouldn’t.” CONTINUED ON NEXT PAGE

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CONGRESS & EXPO

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HazardCall reduces the number of “false alarm” alerts people receive by only calling and/or texting when the precise geographic location is inside the warning area defined by the NWS. Other weather alert services provide alerts for entire counties, or even more broader areas. For severe storms and tornadoes, those warned areas are small, precise and specific. When you receive a HazardCall, you know the weather will get dangerous. “Not only are you saving lives, but you are getting the benefit of PR insurance by making this available to your residents,” said Jenny Hodge, vice president of research for MHI and staff liaison for MHI’s National Communities Council. “When the TV cameras show up, do you want to be shaking your head sadly saying, ‘If we only had a warning in the middle of the night that this tornado was coming?’ This service provides extra assurance that your residents will be notified promptly about what actions to take for their safety.” Chris Parrish, who owns and operates Parrish Manor in Garner, N.C., has been

testing this service for over a year, and says, “This service is almost ‘stupid-cheap’, and shows your extraordinary commitment to your residents’ safety. We pride ourselves on the fact that people who live in manufactured home neighborhoods have a strong sense of community and look out for each other. This is one way, as an owner, that we can further foster that family feeling, telling your residents ‘we are looking out for you, and want you to be safe.’” When you sign up for the service, you get a launch packet complete with sample letters or emails to send to your residents. More information and FAQs are available at HazardCallCommunity.com. (Please go to that link to watch a brief video to learn more, and request to launch the service.)

Learn More on a Webinar WeatherCall Services is hosting a series of on-going webinars for MHI community owners. Contact them regarding when the next one is scheduled to learn more about HazardCall: how it works,

46 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

how much it costs, and how to launch this new life-saving service.

Customer Testimonials HazardCall is a product of WeatherCall Services, LLC. Here’s what a few of what the tens of thousands of WeatherCall subscribers have to say: “I can’t tell you how grateful we are. If you EVER need a LIVING testimony for WeatherCall, let me know. I’m here today and will be here tomorrow, all because of you.” - Danny H, Huntsville, AL “I got a couple warnings, and about 3-4 minutes before the twister hit, I got one more call that said, ‘Take cover now!’ Boy that really shook my head straight that this is not just another storm. So from my family we all thank you for this wonderful system.” - Candy, Dicken MHV

Keep up with all the latest industry news online at: mhinsider.com

Did You Know the Manufactured Housing Industry Has a PAC? An essential element to the success of any national trade association’s advocacy efforts is its political outreach. Political action committees are an important tool that allows association members to have a voice in elective politics. The manufactured housing industry has one federally-registered, non-partisan political action committee: MHI-PAC. Personal contributions of eligible employees from MHI member companies are combined with others so that MHIPAC can support candidates that understand the issues that are important to our industry. Established by the Manufactured Housing Institute in 1975, MHI-PAC provides financial contributions to political campaigns of federal candidates who support a sound pro-business philosophy and responsible positions on issues impacting manufactured and modular housing. Campaign fundraising is a necessity in today’s political process, and MHI-PAC helps to ensure that our industry has a voice and that pro-manufactured housing candidates are supported.

Get the Facts About MHI-PAC

MHI-PAC Administrative Fund

4 The only federally-registered, nonpartisan political

4 The MHI-PAC Administrative Fund is a separate, non-

action committee representing the manufactured and modular housing industry.

4 MHI-PAC contributes to both Democratic and

Republican candidates in the U.S. House and Senate.

4 Allows MHI members to pool permissible, voluntary personal financial contributions to support federal candidates nationwide, allowing the industry to have a stronger voice. 4 Is governed by a diverse board of 17 individuals who represent all facets of the factory-built housing industry and who meet throughout the year to determine the best opportunities for MHI-PAC engagement.

federal account distinct from MHI-PAC that is used solely to pay the operating, administrative, and solicitation expenses of raising funds for MHI-PAC.

4 The PAC Administrative Fund is permitted to accept

corporate or personal donations of money, goods, or services from MHI members to defray these administrative costs.

4 The PAC Administrative Fund means 100% of the

personal contributions given to MHI-PAC are preserved for contributions to federal campaign committees.

4 Allocates funds responsibly:

Voters elected more than 97 percent of the candidates whose campaigns received MHI-PAC support and who were running for election to the U.S. Senate and U.S. House of Representatives in the 2016 election cycle.

Visit manufacturedhousing.org/mhi-pac to learn more, or contact MHI’s Gay Westbrook at gwestbrook@mfghome.org

INDUSTRY PROFILE

Photos courtesy of Adventure Homes

“ Wally is one of those individuals who absolutely gives back to the people who got him here, and it’s really easy to work for someone like that.” – Rich Rice, General Manager of Adventure Homes

INDUSTRY PROFILE

Wally Comer Came to MH Industry for Money, Stayed for the People By Patrick Revere, Managing Editor for The MHInsider™

dventure Homes is only nine years old, but you’d be forgiven if you felt the award-winning manufacturer has been building homes for as long as you can recall. The industry’s national trade organization, Manufactured Housing Institute, in each of the last two years has pointed to Adventure Homes as manufacturer of the year for those with two plants or fewer. And though the single-plant builder based in little Garrett, Ind. had a rather unconventional start, Adventure Homes President Wally Comer and his team have managed to quadruple revenues since the company’s first year. Adventure has added a 20,000 squarefoot finishing plant, the team has grown to more than 200 employees on the production line, and has built a steady stream of high-quality, hand-crafted and

well-priced homes – to the tune of 1,520 homes last year. “The first 20 years of ups and downs has prepared me for the ride I am on now and it is a great ride”

The First 20 Years “I came out of college in 1971 and ran into a young guy who was driving a brand-new Corvette. He was my age and had a Corvette not a Volkswagen. “I said what in the world do you do? And he said he was a controller for a recreational vehicle plant in Riverside,” Comer recalls. “I told him that I couldn’t find anything that I wanted to do, but I was interested in what he was doing. I was working for a pharmaceutical company and hated it. He came to my apartment later and said he got me an interview. The HR guy told me to talk

to one more person before he hired me, and that was Jess Maxcy. Jess hired me and has been a mentor for me my entire career.” Jess currently the state association director in California, but at the time of Comer’s hire was the youngest VP in the Industry. “He ran the entire recreational vehicle operation at Redman. And he was arrogant,” Comer said. “He came into my office on the first day and introduced me to the sales manager, and the general manager, and left no doubt who was in charge. Jess has a strong, forceful personality, but Comer was not put off by Maxcy’s demeanor. He embraced it. Comer called on him for answers to the many questions someone new to the industry might ask. “Every time CONTINUED ON PAGE 51

Adventure Homes Senior Staff Wally Comer

Managing Partner/Owner

Rich Rice

General Manager

Keith Carnahan

Production Manager

Jerry Winter

Purchasing Manager

Susan Kasinger Controller From Left: General Manager Rich Rice, Production Manager Keith Carnahan, President/Owner Wally Comer, Purchasing Manager Gerry Winter, Controller Susan Kasinger in Adventure Home’s conference room in Garrett, Ind. (photo courtesy of Adventure Homes) MHINSIDER.COM • APRIL 2018 • MHINSIDER™ |

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INDUSTRY PROFILE

I needed advice, I would call him. He is a very knowledgeable guy. I still call him,” Comer said. Some of those calls, as it turns out, would be long-distance. The kid who grew up in Glendale, Calif., was shipped off to work in Silverton, Ore. “It was a little bus stop town,” Comer said. “At the Silverton Hotel, you had to go down to the lobby and get the phone to bring it back to your room.”

‘It Was Just Nuts’ In the 1970s the manufactured housing industry was a wild ride always perhaps about to leave the tracks. The industry was rolling out about 550,000 homes each year. “Fleetwood, Skyline and Redman were the big three,” Comer said. “And there were a whole lot of guys gaining ground on those three including Clayton and Champion. “If you were talented at all, they were promoting you up because manufacturers had so many plants and were continuing to open more, he said. Comer was in Oregon about a year when Bob Steins, the sales manager at Redman, mentioned a new sales manager opening to consider. “I said ‘What? I have been a been a salesman here’ and for only a year,” Comer said. “But I got the job and was the sales manager.” It took no time at all for Comer to realize why he got the sales manager’s job. His first step was to attend a sales training in Texas, where he encountered a couple of trainees from Georgia. “Some of the salesman and trainees I encountered were not very good. They couldn’t sell anything,” Comer said. “When I asked about it they said they didn’t ever call anyone. They didn’t have to call anyone. Everyone just called them and they signed orders. My income tripled in 1972 as I started influencing other people to attain their goals. “The industry you see today is nothing like it was. It was ‘Wild Wild West’. People were making so much money they didn’t even know how much they were making,” he said. But Comer was building the foundation of solid sales

Photo courtesy of Adventure Homes

procedures and discipline that would prepare him and the people around him for what was looming. Comer went to North Carolina for a job with Coburn Homes. He was there roughly two years when Bob Steins called again. This time he was in Florida and wanted to see if Comer was interested in a general managers’ training program. He saw this as another opportunity to gain experience, so at the age of 27 started to prepare himself for general management. The work was for Zimmer Homes, out of Cordeal, Ga. “Georgia was big mobile home country,” Comer said. “It was a trip.” It was a trip that lasted only four months. Comer said he had begun to doubt the industry, and had ideals about doing something in the world of finance. He left Zimmer and he left manufactured housing for 10 years.

The Hiatus Comer left the industry but did not very far. He joined AMP, Inc. in Harrisburg, Pa. They were the largest manufacturer of electrical and electronic connectors in the world. They since were acquired by Tyco Electronics. Comer said he spent those years messing around a lot, spending money, and eventually came to terms with the fact he had taken a misstep. He was thinking

about his career, about manufactured housing again, and called Jess Maxcy to talk about it. “I asked him what he thought about me coming back in the manufactured housing industry again? He said ‘Have you learned your lesson? Will you listen to me this time?’” Comer said.

A Return to Manufactured Housing Lee Posey was president of Redman when Comer started in 1971, but went on his own to start Palm Harbor Homes in Dallas. Maxcy told him Palm Harbor had recently opened a plant in Ohio, and maybe Comer could be in sales. Comer again kick-started his career in the manufactured housing industry, putting it on himself to develop the people who would help grow the business. “I was there for a year and did extremely well, had a great year, but it was like the old cowboy industry again, and I questioned myself again,” he said. “It seemed I couldn’t find a lot of good, professional people to rely on.” It was the mid-1990s. He was on the phone with a friend, a dealer in the industry who urged him to make a change. Comer went on to talk with Terry Desio at the Skyline drywall plant in Sturgis, CONTINUED ON NEXT PAGE

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INDUSTRY PROFILE

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Mich., and met a general manager with Skyline named Gary Lambert. “He was a great GM, and we took off,” Comer said. But as his roller coaster career would have it, Lambert soon exited for Palm Harbor. Regardless, it was at Skyline where Comer really got started in the career he wanted with manufactured housing. The industry was noticing the success that Comer was bringing to Skyline, and Tom Lizzy with Holly Park wanted Comer to move over to run the Ohio territory.

Lifetime Homes “My partner was Paul Lytle. He had been a controller, and we got a bunch of investors. We ran Lifetime Homes for about three years,” Comer said. “We were experiencing a steady increase in production, but as the turn of the century was upon us so was a downturn in the industry. “Our investors were not in the industry themselves and were not comfortable with their investment,” he said. “We were Photos courtesy of Adventure Homes

facility had gone through a half dozen GMs in just as many years, and Comer felt his presence was needed. “I got there and we turned it around. I was surrounded with really great people, wonderful staff. I had friends in Ohio, called all the dealers I know and told them to come down, we were going to have a show,” he said. “We got some homes out there in the lot and had people through them. “Dealers walked into a house and said ‘Wally, can we do white trim?’ I said yes, and they hugged me. They were so glad to have a salesman back in the plant, someone who understood service,” he said. The attitude of the employees changed. The attitude of the customers changed. Comer was seen as the right guy at the right time. But more dark clouds were on the horizon. In 2009, Fleetwood Enterprises closed doors and left the Garret facility with a great product, a great workforce and a great customer base without ownership. “It’s the best thing that ever happened to me,” Comer said. “Liberated is a good word for it.”

That Little Plant in Garrett

“I loved Lizzy,” Comer said. “He said the territory was doing 500,000 per year, and when I was there our homes weren’t even listed in the top ten in the state.” This was the first time that Comer could show what he could do on his own. It was a meteoric rise in that market. By building relationships with two of the largest dealers, Ace Elsea and Steve Schwartz, in Ohio he took the territory from 500,000 annually to more than 12 million in only six years. He learned the value of relationships both with customers and co-workers in building business. He was pondering where the next step would be, with his new-found philosophy on people management versus money management, he decided he was ready to go on his own.

forced to sell off assets. This was not an indictment of our business plan as much as the ‘lack of fortitude’ of our investors.” However, the situation couldn’t break Comer’s confidence in himself as an owner of a manufactured home company. It was 2003, and Comer said he felt as though he was starting again. He worked for a bit as general manager for Ritz-Craft Homes in Jonesville, Mich. Then he went to work with Chuck Wilkinson, someone he had worked with at Palm Harbor who had landed at Fleetwood. Comert was asked to run the infamous Fleetwood Garrett Indiana plant with the promise that he could move out to take over the Arizona territory after two years. Everyone warned him away from it, but Comer went anyhow. The Garrett

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Comer went home, talked with his wife. Many of the workers from the plant showed up and bluntly suggested he buy the place, run the plant himself. Comer, of course, worried about financing and the level of energy it would require. But all of those people? Their jobs. Their families? “My wife Joanna, she is really the one who pushed me to have the courage to do it. She was willing to risk it all. She told me she was certain I could do this,” Comer said. He sat with a banker and said he wanted to buy the plant. The banker said “I want to be taller.” They agreed that Comer’s resources were less than sufficient for that kind of purchase, but the banker said a pair of investors he knows might have some interest.

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INDUSTRY PROFILE

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“That was nine years ago, Aug. 5, 2009,” Comer said. Walt Fuller and Jerry Henry put up the money, and Wally Comer showed up on the last Friday of operation for what was Fleetwood Homes Garrett Plant 55. On Monday it would be Adventure Homes Plant 1.

“ If you will help them reach their goals, you will reach yours.” – Wally Comer, President of Adventure Homes

The New Headquarters Adventure Homes couldn’t even hang a sign out front. There were no formal agreements for pay, or insurance or other benefits. But more than 100 people showed up to build homes. In no time, all of the details would work out. The first year, Adventure Homes sold $12 million in homes. Last year, the company topped $50 million. Because Fuller and Henry had confidence in Comer, they gave their full support. And the Adventure plan was simple; keep expenses low, and put all the resources they are able into the homes they build. Today, signs hang in the factory that say “Would You Buy the Home You Built Today?” and “Remember, The Next Inspector is The Customer” as well as “If We Don’t Do It Better – Our Competition Will”. Comer reminds people that the homes Adventure builds cost a substantial amount of money, but the quality and care that goes into them is free. “We don’t really care about the numbers, not as much as we do about the house. We build what people want. Our company is built on giving the homeowner a home to be proud of at an affordable price. It’s ‘Luxury and Comfort for Less.’” “I’m not a mass producer. I’m sort of a quasi-custom builder, and we’ve been very successful,” Comer said. Adventure’s General Manager Rich Rice said, in a strictly business sense, 2009 was not the best time in the industry to start a manufacturing facility. But the decision to launch Adventure Homes had little to do with strictly business logic, and more to do with the passion of the people here to succeed. “We knew our people could do it better and continue to create a demand for our homes even up against larger, more financially stable competitors,” Rice said. “We could do it better and for less money. “This was as pure as it could be in terms of one individual trying to save some jobs,” Rice said. “It was about Wally and his partners, and this town, and their intentions for it. We spent those first three years using what we had learned at Fleetwood, 54 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

but it really was only an experimental start for us along the way to finding our niche.” He said the leadership began to learn just how deeply talented the workforce is, and understood Adventure really could offer a custom home in a way no one else has, from the manufacturing line. It was a brave assertion that Adventure has made good on, and one that professionals industry wide, as well as homeowners in the Midwest, very much appreciate. “We go to a show with a home that has all that ‘bling’ in it for a low price, and we started turning the conversation around so that it’s no longer a wonder that we are able to do this type of customization, but why others don’t,” Rice said. “That’s taken us a long way.” And Comer’s roller coaster career has reached a height he aims to hold onto for a while. “Joanna is the love of my life, and I’m incredibly happy. Both of my business partners are super good guys. They put the funds behind me and it’s just been, it’s been what I’ve always wanted,” Comer said. “If I had to do it, I would not have changed much as everything that has happened in my career has led right here. Manufactured housing has been good to me and I’ve really love the friendships,” he said. “Only in this industry can you get by this way. You do not need fancy degrees or a boatload of talent, you just have to be willing to do the work. The industry is filled with opportunity.” MHV

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M A N AG E M E N T Photo courtesy of Zeman Homes

The Manager’s Job is Mostly Outside the Office

By Michael Power, President at www.MHCInvestor.com

ith the changes in community management needs, what are the manager’s duties today? Beyond writing up bank deposits, filling out late notices, reconciling petty cash and the like, the manager’s main tasks are outside. Yes, outside, not inside the office! But doing what?

Keep Limited ‘Inside’ Community Office Hours The manager should remain accessible to residents, but only when the resident calls to schedule a personal appointment at a time that is convenient for both the manager and the resident. This allows the active management required to create a high level of curb appeal for the residents. There are a couple of ways to approach this depending on the size of the community and how many community homes for sale or lease. A large community of say 300 sites might need a longer set of “walk in hours” for residents but they could be shortened to for example noon to 5:30 p.m. • Option A: No formal office hours. All resident visits or prospects on site visits are made by phone appointment. • Option B: About 1 or 1 1/2 hours of dedicated office time Mon-Thurs, say from 5 to 6 p.m.

Today, Outside Management Is Not An Option But A Necessity

Today’s Manager Is Doing What?

Firstly, the best way to manage lighter What we want our manager to concern office hours is to provide a mobile phone themselves with is 100 percent Park with unlimited minutes to the manager Responsibility Curb Appeal, which can and have the park phone transferred be looked at generally as organization and to the mobile during non-office hours. oversight of maintenance and repairs. Now your manager can work on the most They create lists, show the maintenance important issues, wherever they may be person or contractor what is to be done, occurring, but is not tied to the office check on the project in process and enwhile trying to deal with outside issues. sure proper completion. In other words, Secondly, post a notice on the man- “trust but verify”. ager’s door such as: “Looking for a Another angle of the job is Creating great place to live and to buy or rent a 100% Resident Responsibility Curb home? Call the Park mobile phone now. Appeal. This is inspection and re-inspecMary, Community Manager. Phone: tion of resident violations and giving 111-555-1234” next notice, in sequence, if requests are incomplete. For instance, inspect for new For The Manager, the violations once a week, on Thursday, Workday is Now Very Flexible (this gives residents the weekend to cure a problem) and designate re-inspections What we’ve done here is make a for Monday and the Manager delivers positive transition from time-specific “Final Reminder” if problem not correctprotocols to task-specific productivity. ed. This process reduces the number of Now everything community related resident violations, which overall saves has become as-needed, yet the manager the manager time while improving still has a higher quality of life and the appearance of the community. Remore flexible work and personal life. member to inspect and enforce policies As an owner, could you adapt to this as to each person employed by and live opposed to the manager sitting in the in the community. office all day? CONTINUED ON NEXT PAGE MHINSIDER.COM • APRIL 2018 • MHINSIDER™ |

M A N AG E M E N T

CONTINUED FROM PREVIOUS PAGE

Out in the community duties also includes Inspecting and preparing rehab project lists on park-owned homes, and following through with the completion of work. The manager also needs to show homes to prospects, follow up, close the deal and do all related paperwork. Showing homes often should include passing out resident referral bonus flyers, answering ad calls and organizing and hosting monthly open houses. We want to know our manager is visiting other parks once per month to track homes for sale, taking note of interesting specials, profiling the competition’s curb appeal and the like. That person should be in the field to inspect and write up reports on existing homes the community should consider buying. And, finally, the manager will help set up contractors and manage the homes being moved into the community for rehab and, again, sale or rent. Yes, there is a lot to do! In other words, whatever is necessary to collect 100 percent of the rent each

month, sending an evenly spaced course of four sequential reminder notices, filing in court on 19th of each month as needed. We need to see the manager create and keep 100 percent curb appeal, rehab and have sold every park-owned home, track each abandoned home so the community can obtain it through “title for non-payment” so that no homes are lost or are pulled out of the community.

What the Manager’s Job is NOT Holding multiple, daily coffee clutches, listening to resident complaints about the neighbors, getting into heated debates with residents about the community policies or playing social worker. Residents are to resolve their own personal & financial issues. Managing a community today is focused on the critical issues such as collections, park management & resident responsibilities, keeping the park occupied and producing income. Task specific management allows the manager to reclaim their personal life,

yet, attend to the critical needs of today’s realities in community management. Ownership and off site’s responsibility is to ensure the manager is enthusiastically performing as outlined above. We must provide tools to manage, so our people are not attempting to manage from a blank page, and probably reinventing the wheel. The New Mantra: “The Manager’s Job is Mostly Outside the Office ... NOT Inside!” MHV Michael Power is president of MHCInvestor.com and has been active in the manufactured housing industry for 25 years. During that time he has managed a syndication firm specializing in mobile home parks and apartments. He has consulted with sellers and buyers in transactions across the United States and mentored community owners on operations.Contact him at MichaelPower@mhcinvestor.com.

Keep up with all the latest industry news online at: mhinsider.com

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TINY HOMES

The ‘Tiny House Movement’ Turned Industry

By Darin Zaruba, CEO of EcoVentures, and founder of The National Tiny House & Simple Living Jamboree

ar richer than square footage, the tiny house movement is an invitation to gain a more intentional set of values, meet amazing people, be inspired by simplicity, and find your own expression of the philosophy. These Tiny Houses on Wheels (or THOWs, as we affectionately call them) have taken the U.S. by storm during the past few years, and rightly so. Tiny houses are creative, adorable craftsman-style builds that bring to mind a simpler living way of living. Coming from the traditional “modular housing” industry into this movement has been very interesting to say the least. Our company builds modular homes, park models, commercial, multi-family, hotels to name a few. Although tiny houses are only a fraction of the units our company builds, we are consistently labeled as the “tiny house guys” in the media because that’s what always captures the most attention.

So What Does Tiny House Mean, Exactly? It’s a simple descriptor that means very different things to different people. Those of us in the original “tiny house” movement would define it as a structure, built like a home, on a permanent trailer, that can be pulled with a heavy-duty non-commercial truck. In other words, a little house pulled on a trailer. Others who live by the philosophy would call it a craftsman-style home about 1,000 square feet or less, mobile or not. Simple, right? In just the last five years, this little movement has grown into a fullfledged industry. The new industry has created a new mindset, and a new type of housing niche that defies traditional classifications. Is it really a house that you can get a mortgage on? Is it an RV that should always be coded as such? Is it something

60 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

new? How should they be insured, financed, bought, built, distributed, and regulated? There are many questions. And although you know a tiny house when you see one, creating a mainstream understanding is not so simple. Thus sits the state of the union of the tiny movement, turned big disruptive industry. Whatever you call it, the tiny house movement is now a big business that’s captured the heart of the nation, both product and philosophy. Because much of the industry is yet to be fully defined, most of what we know comes from movement leaders, associations, advocacy groups, and national events. Through that lens, we offer here a snapshot toward continued explosive growth and rapid acceptance of the tiny home philosophy, product and lifestyle as an industry.

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Built On Sweat Equity The movement started with do-it-yourself builders buying plans of visionary designers like Jay Shafer who inspired people to literally build a home with their own sweat equity. Or we worked from books like the Not So Big House series by Sarah Susanka, which showed glorious ways of outfitting small spaces. And the movement was furthered on the backs of the original tiny house companies like Tumbleweed that were featured on The Profit as a partnership with Camping World, unfolding more recently on national television. All tiny house owners and builders are pioneers and visionaries who have shaped their own futures out of risk and sweat. To see this rich tradition continue today, just look at multiple books newly published to see hundreds of examples of these new adventurers, or simply Google “tiny house”, and get lost in the hundreds of thousands of search results you’ll find. Most “professional” builders started as homebuilders or other trade professionals seeing a new opportunity. It’s anyone’s guess, but most leaders agree there are at least 250 people currently who call themselves professional builders and who build more than five tiny houses a year for sale.

A Tiny Philosophy of Life I always say that the movement and industry represents both a product and a

philosophy. You can live in a tiny house, but more importantly it’s a vibrant philosophy you can live out. Nothing illustrated this better than our inaugural 2015 Tiny House Jamboree in Colorado Springs, when tens of thousands of attendees initially gathered together for the first real celebration of the tiny-living philosophy. This philosophy has seized a growing stronghold in the American mindset as multitudes of consumers look to simplify and downsize.

Demand Is Higher Than Ever The demand for tiny houses continues to grow at an amazing rate. Several leading manufacturers are experiencing annual growth in the 200 to 300 percent range, creating a national backlog. There were an estimated 5,000 true tiny houses on wheels sold last year from roughly 100 top professional small builders. This number excludes the thousands of small modular units from builders including Cavco, Clayton and Legacy, as well others who have been building 400-square-foot park models for years. It also doesn’t include the thousands of site-built homes that are moving to smaller footprints. But guaranteed, the shift has happened and continues to grow (or shrink, as it were).

Fueled By Demographic Shifts

Tiny houses are a fraction of the cost of average traditional housing, which brings freedom from debt and a new era

TINY HOMES

of independence for many. This is one of the major demands still driving the movement. Aging Baby Boomers want to simplify and downsize while still keeping their trademark sense of adventure. Retirees who would invest in an RV are instead snapping up tiny homes. Whether a back-to-nature tiny resort or a hyper-affordable option for young professionals, millennials are expressing their values through tiny house living in astonishing numbers. This movement has something for everyone, from a single mom looking for an affordable home, to millionaires looking for multiple smaller getaways in different countries instead of a huge second home.

Zoning & Building Code Changes Lag Most cities and counties have yet to adopt local laws for tiny houses. Movement leaders are actively working at every level to secure the legal framework for tiny house construction, portability and placement. All the while, consumers continue to buy up homes faster than manufacturers can design and build them — even if legal status remains in question. I always teach about the tiny house conundrum as two halves of an onion’s layers that have to be placed back together perfectly to work. What do you want to do (building codes), and where do you want to do it (zoning requirements)? CONTINUED ON PAGE 63

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TINY HOMES

"The National Tiny House & Simple Living Jamboree is expected to draw tens of thousands to Austin, Texas in August 2018." – Darin Zaruba, Founder These must be joined precisely, or it just won’t work. For example, you will never be able to place a tiny house in the middle of Manhattan, even if it is built to an existing recognized and accepted code. Alternately, no one will care if you live in a shed in the middle of 400 acres in North Dakota. It’s all relative. Codes and Zoning must match, down to the individual plat a unit is placed on.

Need For Financing Since the movement crosses several different existing industries, and most small builders have yet to adhere to any specific inspected building code, traditional lenders don’t quite know what to do with these little houses that aren’t on a foundation. To address this need, the Tiny Home Industry Association put a call out to private financiers in 2018 asking for $250 million to help finance consumers.

Developments Are Booming Plans for pocket communities or big developments of all types of small-living solutions are popping up across the country. “We presold most of our units in a matter of weeks”, states James Stinson. His company Constellation is building a 300-site permanent micro-home community outside of Austin, with more in the works. Builders and developers are taking calls from all over the world with great interest. I have personally been in discussions with tiny house movement leaders and developers in Dubai, Nicaragua and the Netherlands, just to name a few far-flung locales.

to address the small-living issues of the new industry. As for other close-to-home examples, my companies in just four years, have 1). sold the Jamboree to the world’s largest exhibition company, 2). sold a pipeline of roughly 3,000 annual units to Sprout Tiny Houses (a public tiny-house company), and 3). as of this writing, closed on a brand new 130,000 square-foot production facility to assist in private-label modular construction for other builders’ demand. The future truly looks bright for the movement advocates, the industry and governments together as tiny house product and philosophy catches on worldwide.

A Promising Movement Turned Industry

Representation of the New Industry

Industry associations, buying groups, mergers and many other exciting happenings are becoming more commonplace now as the movement turns mainstream. The Tiny Home Industry Association (THIA) was founded through a grant from Colorado Governor John Hickenlooper

The Jamboree lives on, now as the National Tiny House & Simple Living Jamboree, and is billed as the world’s largest gathering of professional product and service providers in this disruptive industry. And it’s only getting bigger. With a business and consumer side to

the show, it is expected to draw tens of thousands to Austin, Texas in August 2018. Look at the website for more information and try to attend and get the up-to-date status of everything tiny (www.tinyhousejamboree.com). The new trade association is getting a fresh launch, and looking for active participants. Find more information at their website, and please get involved (www.tinyhomeindustryassociation.org). As the saying goes, “when the tide rises…all boats rise.” We are looking forward to anyone of all size jumping in, and all benefiting as this crazy movement continues to flourish! MHV Darin Zaruba is a speaker, writer, builder, developer, trainer, and tiny-house industry-leader and advocate for the movement. His inaugural Tiny House Jamboree set the stage for the movement-to-industry evolution in 2015. His company portfolio focuses on all aspects of the industry, from modular construction, marketing, development, consulting, management and other services. Contact information: www.ecoventuresllc. net or darin@ecoventuresllc.net

MHINSIDER.COM • APRIL 2018 • MHINSIDER™ |

DEVELOPMENT

Ask the Planner With Donald C. Westphal, RLA, ASLA, Principal at Donald C. Westphal, Associates LLC

How Can We Create An Impressive Image For Our Community At A Reasonable Cost? It has been said that the first impressions last the longest. This phrase can apply to our communities just as it applies to individuals. Those of us who are involved daily in the approval process for new communities are painfully aware of how the negative images of many older and even some newer communities affects our rezoning efforts. Thus, the front door of our communities, whether it’s a new or older property at the gated entry, the road frontage or the community center, it must create a proper positive impression. I have long viewed each new community developed as an opportunity to either move the industry toward greater acceptance or perpetuate the old stereotypes. Cost then to create this attractive image is defined both in terms of economics and the resulting positive industry image. Let us address these three areas of the community: Front Door

The main entrance to the community is the most important of the image elements and should receive a significant share of the image budget. An attractive entry sign and structure sets the tone of the community and establishes the style for other signage necessary throughout the development. Generous landscaping and night lighting make this the focal point of the image area. Larger size plant materials, a mixture of deciduous and evergreen, are required here to give this area an instant positive effect. The cost of these larger plantings can be offset by the use of smaller plantings in less prominent areas. Flowers added to the picture here create the splash of color that draws the eye to the front door. An irrigation system and maintenance program should be considered for these areas to keep them looking their best. Road Frontage The remaining road frontage is next in importance. An adequate buffer area here is very important and will allow for berming and screening of unsightly views to the community such as the rear of the home and its assorted stored items facing the road. Remember, the image is created from border to border of the site. Accents at the corners of the site should reflect the design treatment at the main entrance and signal the beginning and end of the property. Fencing in this area and at other appropriate locations throughout the community can be another unifying element. Weaving fence sections amongst the plantings and berms creates a great effect at a reduced cost. Don’t forget to use a variety of plants in

64 | MHINSIDER™ • APRIL 2018 • MHINSIDER.COM

large beds to create year-round interest and simplify maintenance.

Community Center The community center and its adjacent facilities together are the final elements of a community’s front door. This facility can be a great terminus for the main entry drive or boulevard. Its location should be centered on the incoming lane of traffic for maximum effect. It should be the landscape showplace of the community and an inspiration to the residents. Groupings of shrubs, flowers and trees, chosen for year round effect, should be placed in mulched beds for ease of maintenance. Many buildings of this type are mistakenly landscaped in a way that draws attention away from the building rather than enhancing it. But keep it simple! I encourage you to establish an attractive and positive community image early in the development process and to seek professional assistance. Smaller, less costly plantings, installed early on, soon become established and add lasting value to the community and the homes in it. MHV

INDUSTRY

Industry Reaches Eighth Consecutive Year of Growth in Shipments

he industry just finished its eighth consecutive year of sustained growth in shipments. In 2017, there were almost 93,000 new manufactured homes shipped, which is an increase of 14.4 percent compared to the previous year, as reported by the Manufactured Housing Institute. The top five states for shipments are Texas (17,676), Alabama (6,046), Florida (5,855), Louisiana (5,776) and Michigan (4,791). These five states represent just better than 43 percent of total shipments in 2017. While Alabama’s shipments were significantly higher in 2017, almost a third, or 2,147, from last year were FEMA units shipped into the state. In 2017, there were 5,033 FEMA units shipped into a total of four states including Texas (1,933), Maryland (661) and Louisiana (292).

“It’s clear that underlying demand is strong,” MHI Vice President of Research and Market Analysis Jenny Hodge said. “We believe 2018 also will be a strong year with growth, likely in the 8 to 10 percent range, as the need for quality, affordable housing has never been higher.” In 2017, shipments were evenly split between single- and multi-section homes at 49.8 and 50.2 percent respectively. The increase in FEMA shipments is a contributing factor to the rise in single-section shipments, with the same split being closer to 45/55 percent in other recent years. The top ten states for multi-section homes as a percentage of total homes shipped are listed below. While some states had small overall shipments, it is noteworthy that two retiree destination states – Arizona and Florida – both had

2017 TOP TEN STATES FOR MULTI-SECTION HOMES

% Multi-Section Total Shipments Hawaii 100% 8 Washington 92% 1,207 California 82% 3,681 Oregon 80% 1,408 Idaho 77% 341 Massachusetts 72% 213 Arizona 72% 1,721 Florida 71% 5,855 Nevada 66% 425 Tennessee 63% 2,664 120,000

Keep up with all the latest industry news online at: mhinsider.com

2017 TOP TEN STATES FOR SINGLE-SECTION HOMES

% Single-Section Total Shipments Maryland 87% 851 Ohio 73% 1,921 Nebraska 70% 186 Alabama 67% 6,046 Illinois 67% 1,344 Indiana 66% 1,694 Louisiana 66% 5,776 Iowa 64% 470 Kansas 64% 342 Texas 60% 17,676

NEW HOME SHIPMENTS Total –– Single –– Multi

100,000 80,000 60,000

sizable overall shipments and a clear preference for multi-section homes. Much of the same can be said for the state of California. While typically considering only states with 100 or more homes shipped, Hawaii makes the list due to its 100 percent score – the only state to log an absolute score or either category. The top ten states for single-section homes as a percentage of total homes shipped is influenced by shipments of FEMA units into four states; Texas, Alabama, Louisiana and Maryland. However, single-section homes were a significant percentage of the total for many “traditional” states as well. MHV

50,046

51,606

54,891

2010

2011

2012

60,210

64,344

70,519

81,169

92,891

100,500

40,000 20,000

2013

2014

2015

2016

2017

Est. 2018

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