HOUSINGMANUFACTUREDHOMECOMMUNITYINDUSTRYHOMES COMMUNITIESHUDRESIDENTSMILLIONLENDINGMOBILETIMEPROPERTY FEDERALBUILDINGCONSTRUCTIONCODEMARKETCOVIDPARK SITEOWNERSMEMBERSRENTBUILTSTATEGOVERNMENTLANDMHISALES AFFORDABLEPANDEMICPEOPLENEEDBUSINESSHELP2021WORKGOOD FAMILYASSOCIATIONGROWTHNATIONALCOUNTRYMANAGEMENT CAPITALANNUALFUTUREINTERESTFLORIDASINGLEDEVELOPMENT DEMANDLOTRATESLEASEFINDINVESTMENTASSISTANCEINCREASE SUPPLY BUYERSLOOKINGCRISISEDUCATIONINFORMATIONOPPORTUNITIES L A B O R L U M B E R P R O F E S S I O N A L S A S S E T S FA C I L I T I E S P R O P E R T I E S BUYERFAMILIESREGULATORYRESTRICTIONSRISEURBANBUILDERS VALUEQUALITYSTANDARDSGREATTEAMDATATRUSTEXPERIENCEOFFICE PORTFOLIOFINANCINGLOANIMPROVEMENTSMORTGAGESZONING REGULATIONSCITIESPOLICIESDESIGNEDCHALLENGERENTSCREDIT LENDERSPERCEPTIONLUMBERIMPROVEMENTHOMESITESMARKETING M O R AT O R I U M F A C T O R Y C O N S U M E R E S TAT E E V E N T C U S T O M E R S E X P A N S I O N I M P A C T A C C E S S M A R K E T S N AT I O N S O L D A S S E T S E L L INVENTORYLIVINGBUYINGRESIDENTIALSELLERSPOTENTIALVALUES A D M I N I S T R AT I O N B U I L D I N F R A S T R U C T U R E I N S U R A N C E D I V E R S E R E S O U R C E S B ROW N F I E L D P R O D U C T I O N N E T WO R K I N G I N V E S TO R M A R K E T I N G H O M E S I T E S WAT E R TO O L S H O M E OW N E R S H I P CONFERENCECONVENTIONLOSTJOBSSTIMULUSECONOMY STRONGAMENITIESSELLERENVIRONMENTWORKFORCE H O M E B U Y E R M AT E R I A L S S H I P M E N T S H O M E S I T E I N V E S T M E N T S SCHOLARSHIPSMANUFACTURERSMILLENNIALSRESEARCH HOMEBUYINGAFFORDABILITYTECHNOLOGIESNETWORKRETAILERS MAY / JUNE 2021 | MHINSIDER.COM
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CONTENTS
THE NEGATIVE PERCEPTION IS BOUND FOR CHANGE
PAGE 34
Buckle your Tesla seatbelts, because manufactured housing and landlease communities are getting ready to go on a fast-paced, exciting ride.
HAPPENINGS 6 Industry Happenings EVENTS 12 Manufactured Housing Industry Events ECONOMY 14 Can the COVID Housing Boom Continue? 18 Manufactured Housing Communities at Top Value LABOR 23 How to Establish & Maintain Client Relationships 26 The Art of Hiring a Community Manager 30 Materials & Labor INDUSTRY PERCEPTION 34 How the Negative Perception is Bound For Change 39 What Industry Consolidation Does for Residents LAND USE 4 4 The Value of Manufactured Housing as a Community Asset 48 How Brownfield Can Work for New Manufactured Home Communities
2 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
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To ensure residents are supported during these challenging times, manufactured home community owners and operators have enacted rent repayment arrangements and waived fees. -Manufactured Housing Institute
NATIONAL ADVOCACY 53 Supporting the Industry as the Nation Emerges from the COVID-19 Health Crisis STATE ADVOCACY 56 What is Being Done at the State Level to Address Zoning Practices, Challenges? INDUSTRY TRENDS 58 Monitoring Your Online Reputation: What You Don’t Know is Probably Hurting You 62 Industry Trends and Statistics 68 The Manufactured Housing Industry Post-Covid: How a Worldwide Pandemic Has Fundamentally Changed Our Business 74 Increasing Liquidity for Manufactured Housing Titled as Real Property ACCESS 76 Manufactured Home Lending and Future Potential 82 A Primer on The HUD Code HOUSING POLICY 88 Government Rent Moratorium EFFICIENCY / SUSTAINABILITY 91 Submetering Technologies Support Water Conservation, Cost Tracking, Loss Prevention THE ALLEN LEGACY 94 45 Year Partnership Between HUD & Manufactured Housing MHINSIDER.COM | 3
FROM THE VOLUME 4 • ISSUE 3 MAY / JUNE 2021 MHInsider.com Publisher
Patrick Revere patrick@mhvillage.com
W
Senior Graphic Designer Merit Kathan merit@mhvillage.com
We are entering great, promising times as an industry. There is much to discuss, and this is the place to do it. Like a fair father, I typically resist picking favorites, but friends, the truth is (shhh!) … the State of the Industry edition of MHInsider is my favorite of the year. It’s the big, sweeping themes, the big ideas and solutions, and the come-one, come-all hail to the voices across our country who want or need to talk about manufactured homes and factory-built housing. As we tend to do, our team changed up the offering a bit this time. There is more in the way of data, trends, and statistics, a feature many of our readers favor. We brought in some new voices, too, notably economist Bryce Gill from First Trust Advisors, Maria Horton from Newport Pacific, Matt Bontrager from Newby Management, and James Cook from Yale Realty & Capital Advisors. We re-worked how our content is organized, as well. Typically we assemble the pages by industry audience, but given the bent toward industry trends we decided to assemble the pages by topic. Let us know how we did! Finally, with this edition and on the MHInsider blog, we hope you will notice that our editorial team has made a push toward deeper manufactured housing industry analysis and forecasting, most notably with the launch of a new MH REITs Report brought to you quarterly by Hoya Capital Real Estate. Yes, it’s an exciting time in the manufactured housing industry, and we hope you enjoy reading about here with us!
Patrick Revere is associate vice president
Contributing Editor George Allen gfa7156@aol.com
Contributors
Bill Baird Paul Barretto Matt Bontrager Mark Bowersox James Cook Suzanne Felber Bryce Gill Dr. Lesli Gooch Maria Horton Darren Krolewski Devin Leary-Hanebrink Matthew I. Paletz Matt Winefield
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INDUSTRY happenings Show Ways Unlimited Changes Hands Trisha Le Purchases Industry Event Organization Upon Retirement of Dennis Hill
M
Annual manufactured housing trade shows dating back decades have been produced and managed by Show Ways Unlimited, a Georgia-based company that has been purchased by Trisha Le. “Dennis Hill has run Show Ways and produced industry shows very consistently and successfully for a long time, and it’s something I’ve been fortunate enough to experience and assist with in recent years,” Le said. “We have created the groundwork for a successful business transition so I can continue to support our clients and Dennis can enjoy a much-deserved retirement.” Hill’s experience in the manufactured housing industry covers more than 50 years with shows across the country. Le brings more than 14 years of business operations and event management experience in her new role as owner and president of Show Ways Unlimited, including working side by side with Hill in behind-the-scenes show production during the past four years. Le will implement a variety of enhancements to streamline exhibitor signup, attendee registration, and show management, as well as integrating knowledge from events in other industries while building upon established relationships created within the manufactured housing industry. “Manufactured housing is a growing industry. The need for strategic places to stage new homes, while providing intriguing marketplaces for vendors, forums for education, and networking among manufactured housing professionals, particularly after coming out of a time when we’ve been so isolated from one another, is something I am tremendously passionate about and look forward to expanding on in the future,” Le said. Le will continue to operate in Georgia, with a primary focus on serving clients and customers to produce forward thinking, expansive, and innovative shows. For more information about manufactured housing industry trade shows and events, or Show Ways Unlimited, contact Trisha Le at (770) 587-3350 and showways.tl@gmail.com.
6 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Trisha Le, Show Ways Unlimited
Happenings
Texas Community Refinanced for $7.45 Million Country Glen, a 121-homesite manufactured home community in Weir, Texas has been refinanced for $7.45 million through Bellwether Enterprise Real Estate Capital. “This deal is especially exciting because we were able to provide the property owner with an extremely competitive interest rate,” said Cindy Hannon, senior vice president in Bellwether Enterprise’s Atlanta office. “The greater Austin area is one of the most desirable places to live in the U.S., and we are pleased to expand our portfolio in the area.”
MidCap Arranges Financing for Community Portfolio MidCap Loans has arranged a $10.8 million Fannie Mae refinance loan for a pair of manufactured housing assets owned by Treehouse Communities. The portfolio includes communities in Colorado and Oregon. Treehouse will use the financing to recapture equity and make capital improvements.
ing Housing Board Community license. The extension connects Countryside and Village Green Mobile Home Park with access from West River Road.
Elevation Capital Launches Eighth Fund Elevation Capital Group, a real estate investment company and sponsor of private placement offerings, has closed its seventh fund, MHPI VII LLC (Fund 7), after raising more than $130 million in investor equity, and has launched its eighth round with commitments in excess of $20 million. To date, Fund 7 has purchased 26 assets located in markets that include Houston, Dallas, Austin, Washington, D.C., Phoenix, Denver, Sacramento, and Las Vegas. Elevation focuses on manufactured housing communities and self-storage facilities, and through its affiliates, has purchased properties worth more than $600 million and owned interest in more than 200 assets across 30 states.
Marcus & Millichap Names Cleveland Executive Alabama Manufactured Home Community Changes Hands ELYA Holdings acquired the Daleville Mobile Home Park, a 152-site community in Daleville, Ala., a pristine park with high occupancy, high percentage of new homes, and public utilities billed directly to residents. “The Daleville acquisition is a major milestone for ELYA, growing our portfolio to 11 park in three states and a total of 667 lots,” ELYA founder and CEO Yaniv Zief said. The holding company has completed five acquisitions in a year and plans continued assertive expansion.
Maine Manufactured Home Community Gets Expansion Approval The Waterville (Maine) Planning Board voted to approve final plans for a 60-unit expansion of Countryside Mobile Home Park with the conditions that the project receive a permit from the State Department of Environmental Protection, Natural Resource Protection Act permits, and U.S. Army Corps of Engineers technical flow transition and wetland impact approval, and a Maine Manufactur-
Marcus & Millichap has promoted Michael DiCillo, Jr. to vice president of investments in the Cleveland office. A graduate of John Carroll University in Cleveland, DiCillo began his career with Marcus & Millichap in 2016, specializing in the sales and marketing of manufactured housing communities nationwide focused in major MSAs throughout the nation, including Indiana, Michigan, Oregon, California, and Arizona.
Owner Sells Iconic Minnesota Manufactured Home Community The Monticello Mobile Home Park with 331 homesites has been sold to Lakeshore Management, of Skokie, Ill. “On behalf of Kent Kjellberg, the Kjellberg family and staff, we’d like to thank the community of Monticello, and all current and previous residents of Kjellbergs Mobile Home Park, for your support and patronage,” a message read on the company website. The property sold for $20.91 million and will be renamed The Meadows. Lakeshore Management is an experienced management company with operations in Minnesota, Wisconsin, » MHINSIDER.COM | 7
8 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Arizona Investor Acquires Denver-area Community for $20.4 Million St. Vrain Village Mobile Home Park in Longmont, Colo., has traded for $20.4 million to Treehouse Communities. Berkadia originated an $11.7 million Freddie Mac acquisition loan for the buyer. FollettUSA sold the 136-site property after previously purchasing the asset in 2017 for $11.5 million.
Nations Lending Names Sales Manager for Northeast Indiana Chris Smith has been hired by Nations Lending as area sales manager for Northeast Indiana. Smith, a Fort Wayne native, will continue to serve the community with the power of Nations Lending's tools and products, including FHA, VA, USDA, HARP, low interest refinances, and conventional and adjustable-rate mortgages. Smith has more than 15 years of home loan experience.
52TEN Acquires Country Breeze Mobile Home Park Country Breeze Mobile Home Park has been purchased by 52TEN. The 159 homesites are in Yuma, Ariz., the sixth community in the portfolio. The recent transaction was completed off-market with the park’s former owner, acquired with a combination of private equity and debt. “This was a great opportunity to acquire a family park,” said Nate Pattee, 52TEN co-founder. “With this purchase, we now have a solution for both seniors and families and the benefit of additional economies of scale.”
Louisville Community Sells For $15 Million Crystal View Capital Fund sold Southland Mobile Home Community to its investors for $15 million. The 311-homesite community was purchased for $7.1 million in 2019 and was viewed as a long-term investment by the fund. "Every now and then a deal comes along that you cannot help but get really excited about; this was one of those deals,” Crystal View Principal and Managing Partner Matthew Ricciardella said. Crystal View Capital is a private equity real estate firm that specializes in the acquisition and management of self-storage facilities and manufactured housing communities.
Alabama Town Amends Zoning for Mobile, Manufactured Homes The Wadley (Ala.) Town Council approved an amendment concerning mobile and manufactured homes in the newly adopted zoning ordinance, defining three types of homes: A - brand new multi-width, B - brand new single width, and D - any mobile home that is not used for occupancy. Wadley Mayor Donna McKay said the change is intended to provide residents with more homeownership opportunities.
Virginia County Revises Manufactured Housing Rules Revisions to rules for manufactured housing were adopted by the Clarke County Board of Supervisors in Virginia to match statewide definitions. Specifically, the county eliminated a minimum width requirement of 19 feet.
Residents in New Hampshire Purchase Community Homeowners in Paradise Ridge Mobile Home Park have purchased their 40-unit manufactured home community with training and technical assistance from the New Hampshire Community Loan Fund’s ROC-NH™ team. The cooperative negotiated with the park’s owners, Albert and Joyce Witham, to reach a $2 million purchase with financing from Cambridge Trust and N.H. Community Loan Fund.
Idaho Association Honors Industry Veteran The Idaho Manufactured Housing Association has honored Doug Strunk for his dedication to the manufactured housing industry for the past 38 years. He was awarded a plaque and recognized as a lifetime member. Strunk has served on the association board since 1983 and has been through many association name changes, including the Trailer Coach Association, the Idaho Housing Alliance, and the Idaho Manufactured Housing Association. Strunk has served as president of the board four times, and was IMHA’s main education trainer, traveling the state and providing continuing education credits for manufactured home installers and building inspectors. »
MHINSIDER.COM | 9
Happenings
Nevada, Tennessee, Florida, Maryland, New Jersey, New York, and Pennsylvania.
Happenings
YES Communities Provides Scholarships to Seven Students YES Communities through its Building Futures Scholarship Program has awarded $25,000 in annual scholarships for residents and the children of staff to help pursue their dreams through education. “Building Futures is about giving back to residents and staff that strive to make our world a better place each day. We hope that these scholarships will inspire our community to follow their dreams,” Steven Schaub, CEO of YES Communities, said. “We are delighted to support their education and look forward to seeing their accomplishments.”
In Memoriam Pennsylvania Community Owner Laid to Rest W. Gene Henry, 88, of Martinsburg, Pa., passed away and is being honored after many years in the manufactured housing industry. In 1959, he founded W. Gene Henry Mobile Home Parks, which included Spring Drive and Stone Manor communities. He continued that business until March 2020, all while teaching school and then serving as the elementary school principal. Mr. Henry
was a member of the U.S. Army Reserves, spending his active-duty time at Fort Knox, Ky. He attended Henry’s Lutheran Church and St. Matthew Lutheran Church, and he was laid to rest in Fairview Cemetery, a property he helped manage and has funded in perpetuity in the name of his parents, Harry and Marian.
Indiana Community Owner Passes Away Elsie Caroline Dickman, 87, of Auburn, Ind., has passed away. Mrs. Dickman and her husband Burt, who passed away in 2018, owned and operated West Edge Park, Auburn Mobile Home Park, and West Edge Center. She was a member of the Indiana Manufactured Housing Association.
Have industry news you'd like listed here? Call Magazine Publisher, Patrick Revere, at (616) 888-6994, or email at patrick@mhvillage.com
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TOGETHER, WE ARE RAISING THE BAR AND SETTING NEW STANDARDS OF EXCELLENCE. 10 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
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Events
MANUFACTURED HOUSING
industry events Florida Manufactured Housing Association Annual Convention June 17-18 Sarasota, Fla. | Hyatt Regency Sarasota FMHA welcomes back members and guests with “We’re Better Together”, a celebration of the industry’s reunion which will help manufactured housing professionals with an update from economist Elliot Eisenburg, provide an in-depth look at 2020 and ’21 legislation, COVID liability issues, and the impact from Chapter 723, the Florida Mobile Home Act. For attendance, exhibits, and sponsorship, visit www.fmhamember. org/annual-convention
2021 Multi-State Convention July 31-Aug. 2 Orange Beach, Ala. | Perdido Beach Resort Join the Alabama, Louisiana, and Mississippi manufactured housing associations to explore “New Horizons”, the theme of the 2021 event, which will include networking receptions, banquets, educational speakers, and state-specific continuing education opportunities. Attendees can explore an upscale marina near the resort that offers deep-sea fishing,
12 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
dolphin excursions, boutique shopping, a day spa, and local eateries. Of course, a round of golf is nearby at a number of signature courses. Registration, exhibit, and sponsorship opportunities are available. Visit www. msmmha.com/convention.
Networking Roundtable Aug. 12 Nashville, Tenn. | Hilton Nashville Downtown EducateMHC presents the final Networking Roundtable, a celebration of the annual event’s decades-long history and a retirement party for its founder and manufactured housing industry icon George Allen. There will be a state of the industry address by Allen, other keynote presentations, a networking event, as well as a very special presentation to cap the evening. Please visit www.educatemhc.com for more details on registration , exhibiting, and sponsorship. Capacity is limited!
Events
If you have an event or gathering — virtual or in person — you would like to have listed with MHInsider, please contact us at: www.mhvillage.com/pro/manufactured-housingindustry-trade-shows/
RV/MH Hall of Fame Induction Dinner & Ceremony
Manufactured Housing Association of Oklahoma
Aug. 16 Elkhart, Ind. | RV/MH Hall of Fame and Conference Center After a year’s wait, the RV/MH Hall of Fame invites industry professionals, family, and friends to celebrate the Hall of Fame inductees from 2020 and 2021, with an earlier 5 p.m. start and an abbreviated presentation schedule to accommodate the larger than usual induction class. Dinner will be served, and a cash bar will be available in the newly enlarged and renovated space, with a view of the new Manufactured Housing Museum currently under construction. For more information visit www.rvmhhalloffame.org.
Sept. 21-22 Durant, Okla. | Choctaw Resort MHAO continues to develop programs and make opportunities available for its members, fostering growth through professional development seminars and workshops, and providing the most up-to-date information available to the industry. The members of MHAO have and will continue to make a difference. MHAO membership is an investment in the future of affordable housing. Visit www.mhao.org.
Illinois Manufactured Housing Association Annual Conference and Member Meeting Sept. 16, 2021 Oak Brook, Ill. | The Drake Hotel The Illinois Manufactured Housing Association invites members to the 2021 in-person annual meeting for legislative and regulatory updates, networking, and educational programming to help grow your business and sell more homes. Visit www.imha.org.
SECO2021 Sept. 27-Oct. 1 | Virtual Event The SECO National Conference of Community Owners is again going the extra mile in offering manufactured housing professionals five days of access to exclusive industry content. In their second consecutive year of offering a virtual event, professionals from around the country will appreciate this innovative and educational platform with opportunities for networking.
MHINSIDER.COM | 13
CAN THE COVID HOUSING BOOM CONTINUE? by Bryce Gill
Home values are on the rise in most markets, placing an emphasis on affordable housing.
14 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
completed new homes available for sale is down 48.1% in the past year, the result of a massive increase in demand during the pandemic outrunning the ability of builders, who are hamstrung by social distancing regulations and disrupted supply chains, to bring enough new supply to the market.
How to Look at the Housing Market Post COVID Restrictions Now that vaccines are increasingly widespread, portions of the country
at higher post-pandemic levels for several reasons. First, a trend toward work-fromhome is likely to remain in place even as pandemic-related measures are eased around the country. Many companies that previously required workers to be in the office changed their policies during the pandemic and it will be hard to reverse them. Moreover, many companies that were initially skeptical about these policies are realizing how good they can be for the bottom-line by eliminating office space expenses.
The trend toward suburban and rural settings in place of urban living has created a unique housing dynamic.
have begun reopening the economy. Many are left to wonder what the outlook for the housing market is. Will sales collapse as apartment rentals in the cities once again become viable competitors for single-family homes? We don’t think so. We expect the housing market to continue to perform well, with sales stabilizing
That means people who were previously tied to specific locations, typically in urban areas, will have more flexibility, making more space in the suburbs or rural settings an attractive proposition. Second, there has been a huge shift in buyer preferences over the past year, with younger buyers who »
MHINSIDER.COM | 15
Economy
B
By many measures, the COVID recession is the worst since the Great Depression. Within two months, the U.S. lost 22 million jobs as most of the country went into lockdown in the early days of the pandemic. By comparison, the Great Recession in 2008 saw job losses of 9 million peak-to-trough. Meanwhile, unprecedented restrictions on daily life over the past year have resulted in the closure of roughly one in five small businesses, with the service sector particularly hard hit. Depending on what data you look at, though, you may not have noticed a recession at all. For example, personal income actually rose 6.1% in 2020, the result of the federal government stepping in and more than fully replacing lost income with stimulus checks and boosted unemployment benefits. Meanwhile, every major statistical group — from the top 1% to the bottom 50% — saw their net worth rise in 2020. Households saved more money than ever, paying down debt and improving their personal balance sheets. Nowhere has this dichotomy been more apparent in the past year than in the U.S. housing market. Sales of new and existing homes rose 20.1% and 6.2% respectively in 2020, the result of people fleeing strict pandemic restrictions, large-scale urban unrest, and a desire for more personal space in the suburbs during the lockdown. The inventory of existing homes available for sale is currently at its lowest level on record back to 1999, and 74% of homes sold in February were on the market for less than a month! Meanwhile, the number of
Economy
have preferred cities in the past finally seeing the value of owning their own home. In fact, for the first time, Millennial borrowers in 2020 accounted for more than half of new mortgages. This shift in preferences hasn’t all just been age-based though. All demographics of people have been leaving hightax states with strict pandemic restrictions for greener pastures,
births was in 1990, meaning that group is turning 31. And Census Bureau population projections show that the key homebuying population is those aged 30-49 years. Home buying is set to grow significantly through 2039. However, in order to meet this rising demand for housing, the U.S. will need to solve the slow-rolling building crisis that has been ongoing
As entrepreneurs step in and solve the current inventory shortage in new and exciting ways, one of the major headwinds in the U.S. housing market since 2008 will begin to dissipate.
-Bryce Gill
and in huge numbers. Looking at the most recent estimates from the U.S. Census Bureau from July 2019 to July 2020, just midway through the pandemic, demonstrates this. California, New York, and Illinois on net lost 278,374 residents while Texas and Florida on net gained 615,221. In the past year, new home sales are up 20.2% in the South but are down 11.6% in the Northeast and 8.1% in the West. We expect the South to continue to make up a larger share of overall home sales in the future as U.S. internal migration continues and less arduous zoning and construction regulations continue to give the region distinct advantages from a cost-of-living perspective. Finally, there are significant demographic tailwinds coming together for home sales for the foreseeable future. According to Pew Research, Millennials in 2019 surpassed Baby Boomers as the largest living generation. The biggest cohort of Millennial
for decades. In the early 1960s, the U.S. built roughly three new housing units for every 100 households annually. However, that number has steadily fallen over the years to just a single new unit for every 100 households in 2020. One part of this decline in new construction over the years is increasingly stringent zoning and construction regulations, with current homeowners pulling up the ladder behind them in large cities to the detriment of a new generation. However, another major issue is the stagnation in productivity growth for single-family construction, which has resulted in fewer homes being built at higher prices. In fact, the Bureau of Labor Statistics found that between 1987 and 2019, labor productivity fell slightly for single-family home construction. On the whole, we’ve actually gotten worse at residential building in the past 30 years!
16 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Innovation and the application of modern manufacturing techniques to residential construction will be crucial to alleviating this problem going for ward. Pre-fabricated housing, where units are designed and manufactured off-site to benefit from economies of scale before being transported and assembled at the desired location, offers a promising way to meet this challenge. We have also only just begun to see the possibilities with 3D printing, with a developer in Mexico recently printing entire homes in under 24 hours. As entrepreneurs step in and solve the current inventory shortage in new and exciting ways, one of the major headwinds in the U.S. housing market since 2008 will begin to dissipate. This paired with the pandemic-induced shift in living preferences, improved household finances, and advantageous demographic shifts should keep housing primed for continued growth in the years ahead. MHV Bryce Gill has been a member of the Economics Team at First Trust for seven years and works with Brian Wesbury in the creation of the weekly “Monday Morning Outlook”. He is based in Austin, Texas, is a graduate of Miami University (Ohio) with a bachelor’s of arts in economics and UT Austin with an MBA from McCombs School of Business.
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MHINSIDER.COM | 17
Economy
MANUFACTURED HOUSING COMMUNITIES AT TOP VALUE by James Cook
18 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Economy Manufactured home communities are selling at unprecedented high levels as industry consolidation continues.
W
We are in a unique time in my 15plus years of community brokerage where both buyers and sellers are mutually motivated and aligned. When I entered the business, I made my own quick benchmark that the value of lots was around 80-100 times the monthly lot rent (i.e., $250 lot rent would be worth $25,000 a site and $450 lot rent worth $45,000 a site). Today, that benchmark, as well as all benchmarks, has been rendered obsolete due to immense pressure on cap rates. The new normal, on high quality communities, seems to
be pushing 200 times monthly lot rents; however, we are seeing deals go way beyond this level if there is ample upside or growth potential. I have examples of values exceeding 300 times monthly lot rent when the upside was strong and accessible, whether it was due to below market rents, lease-up or even expansion. Sellers are motivated today because the impending increases in interest rates, taxes, and regulation seem to be eroding their margins, making their life less fun, and affecting their net proceeds should they wait to sell » MHINSIDER.COM | 19
Economy
later. For instance, if capital gains rates are done away with, as threatened by the current administration, you could see your all-in tax rate reach nearly 50% with depreciation recapture. Also, with the growing possibility of 1031s being eliminated, owners need to consider alternate, more immediate exit strategies. Meanwhile, buyers are motivated by the threat of real inflation and desire to be in assets that resist or even benefit from inflation. Furthermore, wage growth should translate to more demand and even higher lot rents. Lastly, there is a resurgence of folks looking to move to the suburbs and into detached housing making our asset class inherently more attractive. Another major factor increasing values from 10-plus years ago is the
acceptance of the MH and RV asset class by institutional investors. This means we have gone from maybe five or six billion-dollar funds investing in the space to more than 50 today with new entrants joining the fray all the time. Our equity division spends its days working with hungry operators looking to scale and buy or build a portfolio, as well as new, eager, billion- and even trillion-dollar funds looking for a good jockey to bet on. The increase in capital chasing the industry has been incredible, but it comes at a pivotal time as many of these assets were built 40 or 50 years ago. The families that built these communities are now going through a generational transition, and the data shows us most businesses will not make the first leap to the second generation, and even fewer will go from second to third generation. As the new generation decides they can’t work together or the parents find it is better to sell and divide the cash versus leaving assets to be fought over, communities and portfolios are randomly becoming available. Now, for the investor, this generational turnover is creating enough acquisition opportunities to keep them busy and engaged. Meanwhile, the general unwillingness to approve construction of new communities provides a guarantee of scarcity that creates a moat around their investments. In many cases, the residents have also benefited from the increased investment in these assets upon turnover. Often, these properties have been held for a long time by a family that is not in a place to do massive updates and improvements.
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Family-owned communities in most markets are being purchased by institutional investors who improve infrastructure and upgrade homes and amenities.
When a new investment group comes in, they are looking to the future and asking what will attract the current and next generation of residents instead of the generation it was designed for when the community was built 40-plus years ago. This usually means significant investments in the infrastructure and new homes, as well as the amenities. Of course, these improvements frequently come with an increased monthly rent, but the improvements and increases in advertising generally mean that their home values are maintained or even increased such that any of the residents that would rather have an affordable, old-school community can sell their homes easily and find the housing provider that caters more to them. The biggest threat to both buyers and sellers is a significant increase in interest rates, which we have
already seen run from 2.5-2.9%’s to 3.5-3.9%’s in the case of a $5 million agency-qualified, 3-star community. Additionally, the significant increase in insurance rates as of late have created another threat, but neither of these factors have begun to impact values at this time. If rates rose by another 1% or if there was a sudden pull back in the credit markets, we could see a softening of the market. On the other hand, as the CMBS market returns and more lending avenues open, we could see a tightening of spreads or risk premiums the lenders are charging on top of the correlating treasury yields. So, like most other times in life, the bird in hand is likely worth two in the bush. Even if rates rise and buyers are upside down in the short term, 10 years of improving the economics of the newly purchased
property will continue to offset that. As for the seller, tax rates are much more likely to rise than fall in the coming years, based on the current political and social environment, meaning there is no better time than now to consider selling. MHV James Cook is the national director of brokerage for Yale Realt y and Capital Advisors. He entered the manufactured housing and RV property asset class in 2005 as a licensed agent listing homes for a local investor. In 2012 he founded the fully integrated finance and brokerage shop and has accumulated transactions exceeding $1 billion in value. He offers perspective at a national level, providing insight into the niche industry.
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How to Establish & Maintain
Client Relationships by Matt Bontrager
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When it’s time to sit down with investors and residents to go over goals and expectations, we approach each property individually to assess needs and strengths. Newby Management is as hands-on or hands-off as the client desires, and we strive to be proactive in management approach. Our primary goal is to establish and build relationships with the residents. We want to develop a good line of communication and ensure needs are being met. The established line of communication becomes extremely beneficial when a community is undergoing changes or renovations. The open dialogue with residents provides understanding of when, what, and how changes will be happening within the community. »
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Our community managers are on site during all work hours to assist residents, and a majority of our managers actually live in their community as well. Having community and regional managers available and being responsive goes toward building the relationships with residents to help prevent small issues from turning into larger ones. The proactive approach allows you to identify problems quickly, as well as the ability to come up with a safe, reliable solution. The goal is to show investors and residents that we are dependable, available, and that we care for them. We believe this builds trust between our management company and the community residents moving forward.
Regional and community managers are well versed in the process for capital improvements and are able to identify areas where attention is needed. Many of the managers have completed the Accredited Managers Course, offered by the Manufactured Housing Institute, and have an extensive knowledge about the industry with years of experience in the field. Field experience has informed of us when investment in repairs, renovations, or general upkeep is needed, and we do not wait until a problem arises. Through our extensive time in the industry, we have been able to build up great relationships with local contractors and vendors to ensure quality work is done in a timely manner.
Management Principles for 55+ Communities, RV Properties Each community is different, and with that comes different types of residents. Therefore, we go through a rigorous hiring process to ensure that our community manager is the perfect person for a specific community based on community needs. For our 55+ communities, the management approach is about providing residents with a place to retire, vacation, or simply enjoy the Florida lifestyle. Typically, residents at 55+ communities enjoy having organized events, updated and new amenities, and the feeling of being part of that community. Community managers plan events and outings for the residents to keep them active and involved. Many of
When manufactured housing meets resilient community design and planning. At the Nadi Group (formerly Donald C. Westphal), we will ensure your community has growth, value and longevity from the onset of your development. Email info@nadigroup.com or call 1-844-669-6234 to learn more. design for a better world.
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24 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Prioritizing Needs for Families, Individuals Newby Management’s approach to all-age communities is mainly about providing affordable housing in a safe, convenient location. Again, the main goal is to meet and exceed the expectations of the investors and residents. While 55+ communities prioritize new amenities and being part of a close-knit community, residents in all-age communities are more concerned with affordability, rule enforcement, safety, and having playgrounds or nearby attractions for kids. The downfall of many multi-family housing solutions, including some all-ages manufactured home communities, is that managers may only see residents when time comes to
Through our extensive time in the industry, we have been able to build up great relationships with local contractors and vendors to ensure quality work is done in a timely manner. -Matt Bontrager
pay rent, or if there’s a maintenance concern or noise complaint. We want our managers stay active within the communities to get to know the residents on a more personal level. Our all-age communities provide affordable housing mainly to young families and individual adults, so we prioritize providing them with quality, low-cost homes in a location where they feel safe. In order to ensure we are providing a safe environment for young families, all
resident applicants must go through a screening process and background check before they can be approved to live in any of our communities. No matter the type of property or community, the basis of Newby Management’s approach has remained same, to share the love of Christ, while providing unique management services for the manufactured housing industry. We will always approach the management of communities with a Christian attitude, faith-based integrity, and a desire to serve. MHV Matt Bontrager is the marketing manager for Newby Management, a third-party property management company that for 40 years has specialized in manufactured home and RV communities. Bontrager, with a background in web design, SEO, and paid advertising, develops, implements, and executes marketing campaigns for communities. Newby manages 40 communities in Florida, and is a faith-based organization with a passion for excellence in an industry where lifestyle and relationships are the hallmarks of success. Photo Courtesy of UMH Properties
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the communities have a committee, board of trustees, or HOA that we work with to stay in the loop on organized events and to lend resources where and when it makes sense. RV communities are managed in a similar fashion. RV guests generally are a similar demographic to 55+ residents, but RV visitors place more value on the location of the community, the size and space of the lots, as well as updated amenities. For RV communities, we implement a community manager who is sociable, familiar with the RV and travel industry, and someone who is easily relatable to the residents and guests. Many of our RV communities’ residents are seasonal or short-term, but they still enjoy being involved with the community through planned social events and outings that our managers or residents will organize.
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The Art of Hiring a Community Manager by Maria Horton
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There is a unique process for hiring a property manager, and it’s one that has evolved greatly in the manufactured housing industry. In years past, a manager often was a senior retiree who could collect rents and enjoy either concession on their space rent or a rental home in lieu of payment for the job. Those days have escaped us. At present, in order to hire a property manager, we must look for someone who is organized and is good with technology, a problem-solving decision-maker who possesses customer service skills. A perk might be that the management position comes with a place to live and paid utilities. Industry wide, the hourly pay at times was less than minimum wage given the housing accommodations, something labor law no longer supports. Besides, the multi-million-dollar assets we own and operate now require personnel to be carefully recruited, screened, and evaluated. In recruiting a candidate, look for experience. Look for a candidate who has worked in our industry or a similar one. Find someone who is familiar with laws that apply to housing. Inquire about the use of accounting and property management software. Make apparent the need for someone with writing skills, and ask the candidates to compose a letter as part of the application or evaluation. » MHINSIDER.COM | 27
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How to Conduct an Interview with a Community Manager Candidate Starting the interview process, remember you are the salesperson representing your company. Begin by selling this person on your company and why they may want to join your organization. Every part of this process is about you needing quality talent as much as it is about the candidate who wants a job. Below are some questions we find helpful once the interview has begun in earnest. Remember you want the candidate to be excited about the prospect of joining your company! Ask the candidate, toward the end of an interview, “After speaking with us and given what we’ve both learned, do you feel you’re a good candidate for this position?” Ask the candidate to explain their answer. And, of course,to put out the questions in a bullet list like this makes the process seem like an interrogation. It doesn’t have to be. Try to keep the tone conversational, feel free to expand on the planned questions, and let the candidate responses guide you toward other lines of inquiry before returning to the planned set of questions.
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There may be a new set of more sophisticated questions for a follow-up interview. And that’s better saved for a second installment. Your property manager is first in line to represent your property, your company, and your residents. Hiring the right person is vital to your company’s reputation, and it’s more important than ever, in a difficult labor market, to efficiently search for, hire, train, and retain the best candidates for you and for the industry as a whole. MHV Maria Horton is a regional manager and the marketing director for Newport Pacific Family of Companies, an Irvine, Calif.-based community owner and operator, builder, and provider of manufactured housing industry services including third-party management.
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•W hat is your employment goal? Are you seeking a job or a career? •A re you interested in advancement? • What type of formal training have you had? Do you have any certificates that are relevant to housing and property management? •A re you willing to relocate to a different part of the country? •W hat are your salary requirements? •D o you need or want on-property housing?
Sales and Marketing Questions • Can you share with us your impressions about the letter-writing requirement for this position, and how well do you feel you did? •W hat is your strongest marketing skillset? •W hat other sales and marketing proficiencies do you have? • What experience do you have filling vacancies?
Technology Questions •D o you have advanced computer skills? • What kind of accounting and property management software do you use? •A re you familiar with AMSI? •H ave you used a direct deposit machine? •A re you proficient with spreadsheets?
Management Questions •W hat do you like about being a property manager? What do you dislike? • Do you work better independently or with a team, what has the mix been for you most recently? •H ow many staff members have you overseen in your prior experience? •H ave you worked on multiple properties at the same time? • Have you worked as a project manager at your property? Have you worked with vendors? • Do you have knowledge of utilities, and if so can you explain your experience? (Power pedestals, water, sewer hook-ups) • How familiar are you with the state laws affecting this property? •W hat type of manager are you? Describe your people skills. • Do you have an example of how you motivate an individual or team through a difficult task, such as resident rule enforcement? • How would you handle a situation where you did not agree with your immediate supervisor? What do you feel is the best way to communicate with your supervisor?
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General Questions
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Materials &Labor by Patrick Revere
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There are two vital words echoing through the manufactured housing industry and surprisingly, “shipments,” “demand,” and “perception” are not among them. Materials and labor. Labor and materials. Arrange them any way you like. Suffice to say, manufactured home builders, and probably to a lesser degree the full swath of manufactured housing professionals, would take a 2x4 to the forehead -- if they could find one -- for just one more good framer, account executive, painter, or transporter. Materials is a nice, broad term, as is labor, which means if you’re having difficulty in it, you’re having a lot of difficulty.
Photos Courtesy of Jacobsen Homes
What About Lumber Prices? Lumber prices rose more than 240% since the pandemic shutdowns began. The dramatic increase is the result of low inventory in anticipation of a spring crash given COVID restrictions. While there was a short, sharp dip, the demand for lumber rose rapidly throughout the spring and summer as a move to the suburbs ensued aside a massive homeowner push for expansions and improvements. Most building industry analysts and operators anticipated a longer and more disruptive lull in building and home buying. Yet, Home Depot, the country’s largest home improvement retailer, in 2020 experienced a year-over-year sales jump of nearly 20%, an increase of more than $20 billion from annual revenue of $110 billion in 2019 to $132 billion during 2020. » MHINSIDER.COM | 31
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But the high cost and low supply situation is not limited to lumber. Windows are difficult to source. All variety of kitchen appliances are on backorder. Mike Wnek is the vice president of new business development for Jacobsen Homes, the top builder of manufactured homes in Florida. “Even smaller needs like a certain type of tape for finishing a dishwasher.... The holdups are a real problem,” Wnek said. “And there’s no room to keep a home waiting in the wings. We know that these challenges will ease up, but that’s little
were running at full tilt leading up to the pandemic, forced now to play catchup amid unrelenting consumer demand and continued pipeline disruptions.
Finding Help When You Need It Where do you go to find good employees when most of the labor force is being asked to stay home? In an environment where COVID precautions clearly are needed, but essential work must continue, the organization and its customers again are left in the lurch. Wnek said
protect against workers needing to stay home, either because they’re sick, have been exposed, or are needing to care for someone at home who has been. “Again, you do what you have to do to keep the homes moving,” Wnek said. Builders and state associations in Florida, and in other states, have formalized relationships with trade schools, community colleges, and workforce development organizations to find the help they need. “A fellow can get a job at one of these new big box type companies like Amazon with a climate controlled facility and really good salary and benefits,” Wnek said. “We’re competitive, but it’s hard to compete with those types of employers, and they’re all the way up and down I-4,” he said. “Fortunately they haven’t come this far into Safety Harbor, so we’re still doing alright with labor, but it is a challenge, for us and everyone.”
Coming Out of Coronavirus Economy
We anticipate a return to the upward trend in housing starts very soon, led higher by single-family homes. -Mike Wnek comfort when you’re enduring them day-to-day.” At most plants, a home that cannot receive windows stops the production line. And most facilities
Jacobsen typically employs about 160 people at its Safety Harbor, Fla., facility. However, during COVID the number of payroll employees had to rise to more than 180 as a buffer to
32 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
It is a bottle-neck economy with backorders mounting. That’s to say, the demand for quality affordable housing and the path to homeownership has never been more valuable. Any way you look at it, 2020 was a “good” year for manufactured housing in an otherwise awful year. The new year is brightening. Vaccines will help return most Americans toward a relative if uneasy normalcy. We also know job programs and talent recruitment efforts work in our favor during stable times, and material and pipeline disruptions
2021 Spells Eased Restrictions, Substantial Real Growth Brian Wesbury, the chief economist at First Trust Advisors, said the robust early spring job gains of the spring may translate into a jobs boom, despite the bad April jobs report, that could include 30day reports of a million or more new jobs. “We need it,” Wesbur y and co-author Robert Stein penned in a report last month. “In spite of the surge in jobs in March, total payrolls are still 8.4 million short of where they peaked pre-COVID, with the leisure & hospitality sector, all by itself, accounting for 3.1 million of that deficit. Most of those gaps should be closed by the end of this year.” First Trust’s ISM Non-Manufacturing index rose to 63.7 in March, nearly four points beyond expectation. The reading is the single best since recording began in 1997. All eighteen industries tracked in the index reported growth, a “feat rarely seen,” Wesbury stated.
The FHFA index is up 12% during that time, its largest gain since the index began in 1991. “We anticipate a return to the upward trend in housing starts very soon, led higher by single-family homes,” Wesbury said. “First, despite a 10.8% decline in February, building permits for future construction remain near the highest level since 2006. Moreover, permits have now outpaced new construction for seven consecutive months. This has resulted in a backlog of projects that have been authorized but not yet started, which is now the largest in nearly 15 years. So, with plenty of future building activity in the pipeline and builders looking to boost the inventory of homes as well as meet consumer demand, look for both
overall and single-family starts to post even higher highs in 2021.” And, as First Trust colleague and economist Bryce Gill notes in the previous pages, a huge shift in buyer preferences has occurred during the last year, very notably with younger buyers seeing an increased interest in owning their own home. Last year was the first in which Millennial borrowers made up better than half of new mortgages. So, if general economic models hold, the manufactured housing industry is poised to do well. MHV
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Who is Buying A Home? And then there’s the homebuying crowd. Even through the winter and early spring, amid continued lockdowns and moratoriums, home buying stayed strong. Similarly, homestarts nationally waned only with seasonality and for a short time through the devastating weather in the central plains. The Case-Shiller index was up 11.2% during the last year, its largest single-year gain since 2006.
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are just that, even if costs stay higher than recent years, which many believe will be the case.
HOW THE NEGATIVE PERCEPTION IS BOUND FOR CHANGE by Suzanne Felber
The Welcome Center at Loma Vista makes for a bright, inviting gathering2021 place| STATE for residents. 34 | MAY-JUNE OF THE INDUSTRY EDITION
When manufactured housing professional Scott Roberts asked if I followed Elon Musk on Twitter, I was embarrassed to say that I didn’t, but I sure do now. Roberts shared with me some of Musk’s latest posts: “Urgent need to build more housing in greater Austin area!” “Over 10,000 people are needed for Giga Texas just through 2022!” And “High School Grads: You do not have to have a college degree to work for Tesla straight out of high school. Tesla is recruiting high school students who can graduate high school and start a career at Tesla while continuing their education.” What does this have to do with manufactured housing? Everything. These new entries into the workforce are our potential new home buyers, and for Roberts, Tesla Giga Texas is an easy five-minute drive from his Oak Ranch Community and nine minutes from Loma Vista, properties operated by Roberts Communities. As much as things change, they stay the same. We start dreaming about having a home of our own from when we get our first Barbie Dream House or a treehouse in the back yard. But in a city like Austin with a median sales price for a sitebuilt home in the suburbs being $344,000 and in the city of Austin, the median list price of a site-built
home being $475,000, there is no way the workforce that Tesla is hoping to hire will be able to afford a place to live. An average one-bedroom apartment rents for $1,518 per month. With prices like this, a home of your own seems out of reach for many. When Roberts took over the family business in 1998, they were focused on 55+ communities. When he saw an opportunity to buy failed, empty parks and revitalize them, including Oak Ranch in Austin, he wondered why something that is so good for retirees couldn’t be just as good for families. When Roberts purchased Oak Ranch, there were no homes, and only a shell of a community center. Roberts and his team converted the property from a local eyesore to a thriving, award-winning all-ages community of 491 homesites, all of which are now full. They also decided to build The Reserve, a 55+ community adjoining Oak Ranch with a separate entrance and community center. Roberts shared that filling The Reserve has been a more significant challenge, and to date, 130 of the 160 lots are full. Roberts said he thinks that we will be seeing more communities where family and 55+ communities exist nearby or side by side but cautions that the boundaries between the two need to be clear to comply with fair housing laws. This includes separate rent rolls, contracts, a fence, and even gates between the two. The convergence of property types may be a building trend, and it’s »
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Industry Perception
B
Buckle your Tesla seatbelts, because manufactured housing and land-lease communities are getting ready to go on a fast-paced, exciting ride.
Industry Perception
one that should come with some “stigma relief ” for families and operators alike. This isn’t only happening in Austin - retirees, active 55+ buyers, and families all are rethinking apartment life or living in a multifamily building in a tight, urban setting. Land-lease communities can be what so many buyers are looking for; they need to be educated about the value and quality of life that today’s manufactured homes and communities can offer.
income taxes in other states to move to Florida where they can downsize, do Zoom work from home if they choose, and enjoy a new quality of life. Now being part of a community where people check in on each other and the term “know whom your neighbor” has a new meaning. John Hall, President of Newby Management, said that of the 45 communities they currently manage, only four are not 55+ communities, and the residents of their 55+ communities are very protective of that
But we have to be the gatekeepers, earn and claim the chance to impress consumers and municipalities, to show what a good investment our homes are, and what a good neighbor our communities will be. -Suzanne Felber
The Oak Ranch Community has well managed roads as well as nicely maintained landscaping.
From Texas to Florida Affordable Housing is in Demand Florida is experiencing a different type of boom. People consider leaving behind their large homes and mortgages with colossal property and state
age differentiation. They appreciate the social aspects of the active adult lifestyle and feel more in common with the other residents of their own age range, he said. It used to be that almost every manufactured housing community in Florida had a busy shuffleboard court. Now it’s being
36 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
complemented in 55+ communities with pickleball, tennis, nature trails, well-appointed fitness facilities, and of course, a pool that preferably is large enough to swim laps in and host water aerobics classes. But something that the residents refuse to give up is their vintage bingo machines. They are so popular with their retro tubes, lights, and wire cages that Newby Management has found a company to refurbish the ones they already have in their communities. Keeping common areas updated and continually refreshing the landscaping, signage, and look of the community is one of the things that sets a well-managed community apart from the rest. Both Hall and Roberts agree that a 55+ community can be the easiest and most challenging to manage in various ways, and calls for different management styles. Residents tend to have more time on their hands and are happy to tell you where the landscapers missed cutting a lawn section or whose home needs to be power washed. They tend to take much pride in their community and want to be included and informed about decisions that will affect their quality of life. They can be your best sales tools -they want to share their happiness with others. Let’s face it - a perception that often is necessary to overcome, especially with seniors, is that all communities are owned by giant hedge funds or corporations in the business for quick cash. The prevailing perception, which has been earned only in small corners of the industry, is that homesite fees will rise beyond the residents’ ability to pay. Part of the challenge that we
the initial homes and amenities at the back of the property and building towards the front. Hence, if situations change, there is an opportunity to divide the community and make part of it an all-age offering instead. With all of these innovations and improvements going on, it seems that the perception of manufactured homes and land-lease communities is going from “only if I have to” to the consumer’s first choice. But we have to be the gatekeepers, earn and claim the chance to impress consumers and municipalities, to show what a good investment our homes are, and what a good neighbor our communities will be. Iron Horse Properties is making a serious commitment to sharing with city and state leaders the new story about factory-built homes, not just buying or building a property and moving into a town. And Roberts stressed that “we want to stay affordable and achievable here. If we lose our direction, we can’t stay affordable to our customers.” MHV Lifestylist Suzanne Felber has been active in the housing industry for more than 30 years. Felber realized that factory-built housing was the housing of the future, and has been actively working to promote the lifestyle ever since. She started American Housing Advocates as a way to share the great news about manufactured housing. To learn more about her work, visit www.lifestylist.com and www. americanhousingadvocates.com, or read her @lifestylist social media posts.
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Industry Perception
have to take on as an industry is to be better about sharing the real story about many of our community owners and managers (and that industry-wide lot rent increases are only somewhere slightly above 3%). Even community owners and investment groups are starting to understand that messaging is an essential part of being successful in this industry. Paul Chase and Erick Mulicandov, principles of Iron Horse Properties, make it clear from the start that theirs is a long-term investment and that “we as owners put our head down on the pillow at night and feel good about what we do.” If what site builders are doing is any indication, we will be seeing many more communities that have different clusters or villages in them with different styles and types of homes that attract different lifestyles and age groups. Chris Nicely, president of ManufacturedHomes.com, shared that he sees this happening nationwide. Casata is a cluster housing concept that focuses on wrap-around services and lifestyle amenities being built in Austin. It is opening as a lease product for now and uses homes that Skyline Champion Corporation is building. They thought their market would be Millennials just graduating from nearby colleges, but on opening day they toured with more than 200 people. More than half of those people ended up being active senior adults, so their marketing strategy may change. Roberts stressed that flexibility is critical when planning a new community or changing direction on an existing one. He suggested building
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Industry Perception
what industry consolidation does for residents
Photo Courtesy of UMH Properties
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MHInsider asked community owners and operators a question that in the face of criticism from select media outlets and public officials may help shed some light on the value created for residents though the continued consolidation of family-owned communities into larger, investment-grade real estate portfolios. So, what does industry consolidation really do for residents? Steven Blank of Blank Family Communities said manufactured housing industry consolidation has done a few things, mostly good. “The industry has been fragmented with mom and pop owners since the 1950s and recently the consolidation of the industry has gotten a lot of negative attention,” he said. “Yes, it is true that some large community owners have gone into communities that are below market rent, provided no value and have raised rents, but there is also another side to our industry consolidation. Most operators are purchasing under-resourced communities and upgrading them, putting » MHINSIDER.COM | 39
Industry Perception
in new houses, which increases the value of other homes and the stability of the community for the owners and the residents. “Those would be my two biggest points to hit on – the companies coming in with capital and enhancing the lives of the existing residency and providing new affordable houses in communities that would otherwise not have seen a new home put in there,” Blank said. “Mom and pops sometimes can mean cheap rent, but they also likely are an undercapitalized group that, as the cost of raw materials go higher, they fall behind on the necessary fixes that the residents need.”
What we can state is that many of the larger companies that are acquiring communities bring a lot of benefits, oftentimes initiating substantial community improvements. -Steve Adler
Maintaining Value of Homes, Properties Daniel Landy is vice president of UMH Properties. He also cites access to capital as a primary benefit for residents who own a home or live in a community that’s been purchased and is being run by professional management. “A smaller player has a much harder time making capital-intensive improvements to their community. New homes, updates to roads, modernizing water and sewer infrastructure, and other community enhancements are cash-intensive,” Landy said. “Being bigger means you can do all these improvements much easier and faster. This translates to residents getting much better quality where they live, and getting it faster.” Landy said UMH has reduced its interest rates over the year for new residents who want to purchase a home because the growth of the company means the cost of money has gone down. The publicly traded, New Jersey-based REIT in recent years has worked with Fannie Mae to get
40 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
financing for new rental homes, which only makes sense for a company of a certain size. “The financing UMH has gotten leads us to keep investing in the rental home model and increase the supply of rental homes,” he said. “Many smaller players would prefer sales as they get the cash right away, but we believe it’s much better for the resident to offer both and have it be their choice.”
Consolidating Efforts to Sell Homes A larger organization enjoys greater access to capital, but there are other organizational benefits as well. Centralized marketing efforts spread awareness of manufactured housing as a high-quality, affordable product. When independent communities are brought into the fold with other communities in the state or region, the vitality of the community is improved through consolidated marketing efforts. “We have a drone pilot to film communities, we have a high-end website, and a team of professionals making sure our units show up on all relevant listing sites,” Landy said. “Consolidation can lead to a much more efficient and strategic way of telling the story for manufactured housing as a whole, attracting residents who see all the benefits of community living.” Steve Adler, of Murex Properties, said small homesite rent increases are common and necessary, both to keep up with inflation, rising costs due to supply chain disruptions, and for upgrading infrastructure and adding amenities. Part of Adler’s strategy in abating rent increases is the pooling of resource a community can do on behalf of residents, like picking up the cost of a community-wide internet signal, or buying garden mulch in bulk to use in common areas, and provide for homesite landscaping and resident gardening projects. “We certainly cannot deny that there is consolidation going on in our industry, just like every other form of income-property asset. What we can state is that many of the larger companies that are acquiring communities bring a lot of benefits, oftentimes initiating substantial community improvements,” Adler said. “They bring an organizational ability and staffing resources that help manage the community. They are very good at making sure everything is in compliance. They attend to any maintenance items promptly, as well as
The Ancillary Services Michael Callaghan, of Four Leaf Properties, said another area of significant investment for larger-scale community owners is in technology, which can be a financial challenge as well as a technical difficulty in terms of installation and management. “We help provide check services, resident portals, payment portals, access to financing, brokerage services for homes, and those are all things you see from big guys that you don’t see from small guys,” Callaghan said. “They’re backing all the loans for every single new home that goes in,” Callaghan said of the corporate owners. “Had corporate interests not stepped with money in 2008, the business would have been wiped out. There wouldn’t be any manufactured housing community business the way
we know it, because we’re still in the midst of massive upgrades more than a decade later. If corporate money hadn’t come in, if the work of the previous decade hadn’t been done, we wouldn’t have much to work with today, frankly. And where would our residents be living?” Callaghan said most manufactured home community residents feel secure in the home and surroundings, and are grateful for an affordable place to live. “The reality is it’s a great investment for someone who doesn’t have or doesn’t want to spend a lot of money. If you’re going to live in a home for five to ten years before you consider selling, it’s a great deal. “These are unique pieces of property, unique investments, and the only person who’s going to be succeeding in getting where we need to go is the big guy,” Callaghan said. “It’s totally disingenuous to choose to look away from the other side of the story about consolidation, in regard to where all of the capital and the know-how is coming from.” MHV
MHINSIDER.COM | 41
Industry Perception
encourage and help develop social programs and services for the residents,” he said. All of these measures lead to higher home value. “What I have seen from my vantage point is that the lifestyle and overall quality of the community has improved with the change of ownership,” Adler said.
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Land Use Photo Courtesy of Tharakan Consulting
Land Use
THE VALUE OF MANUFACTURED HOUSING AS A COMMUNITY ASSET
O
On the national level, manufactured housing is widely available and the most often used form of affordable housing, particularly as a path to homeownership. Its affordability and availability require no government subsidies and about 22 million people in the U.S. live in a mobile home or manufactured home. But what is the value of manufactured homes to a community, on the local level? Manufactured homes, whether placed on private property or in a land-lease community, provide a great amount of diversity for the homebuyer. And diversity in housing is exactly what the domestic market today dearly needs.
What Makes Manufactured Housing Diverse? A new 747 square-foot single-section home can be purchased through a variety of finance options for little more than $20,000. It is very likely that the same web retailer, factory, community, or retail home center can provide the very next homebuyer a new 2,600 square-foot home for something less than $200,000. Some builders today are making multi-section homes that exceed 3,000 square feet, and many of the larger homes can be built to HUD Code or coded to local modular specifications, each eligible for financing via a conventional mortgage. Of the nearly 100,000 new manufactured home units shipped in the U.S. in each of the recent years, about a third are destined for land-lease communities, though a greater »
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percentage of the homes could fit nicely in a planned community. It’s only a matter of homebuyer preference that brings those very same homes, or others of varying configuration and size, to open land in rural, suburban, or urban infill settings. Manufactured homes can be rural getaway bungalows and just as seamlessly are placed in R-1 residential settings alongside the Tudors, Dutch colonials, and mid-century modern homes we see everywhere. Floor plans, home amenities, material choices, and color palettes are all equally as diverse. Many manufactured home sellers today provide customers the ability to drag and drop customized home choices, as well as reconfigure interior spatial concepts, incorporate flex rooms, and plan for future on-site additions to a new home. Through Fannie Mae’s MH Advantage and Freddie Mac’s CHOICEHome special financing programs, homebuyers today can get a new manufactured home built at about 40% the cost of a similar site-built home with a raised roofline, front porch, driveway and attached garage, hardwood cabinets, enhanced energy efficiency, and much more. Again, these new manufactured homes can be placed on private land, used in new development, or provide much-needed new homes in already established residential settings. For those who read these words, and feel their temperature rise with the ringing sound of some long-ago voice talking about home values this and depreciation of that, please suspend doubt long enough to read the 2018 FHFA House Price Index pilot study on how manufactured homes retain value in a fashion similar to site-built, a
Photo Courtesy of Advantage Homes 46 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
valuable resource within an environment with far too few opportunities to assess such things, shouldering against the forces of exclusionary zoning and NIMBYism.
Who Needs Affordable Housing? Every locale in the U.S. could use a certain degree of additional affordable housing. For decades, home starts and wages have been outpaced by demand and rising home prices. The gap is and has been widening. In many higher-priced markets, this means there are few if any affordable homes for would-be residents within the middle to low-income strata. The big cities and resort towns, and increasingly the mid-size cities, too, cannot find hotel, restaurant, and theater employees who can feasibly live and work in the same community. This, of course, extends into many other areas of employment, including the hospitals, schools, banks, grocery markets, care facilities, and, in fact, the very factory that employs people to build and move our homes.
Building Community Within Community So, is manufactured housing diverse? The manufactured home, the factory-built home, affordable and sustainable, helps to build communities by bringing all of the participants and stakeholders together. The principal, the teacher, the parent, and the student all live in the same local community. Additionally, there are more than 43,000 land-lease communities in the United States. In each of them, manufactured homes are the home of choice. Manufactured homes within land-lease communities can be purchased, placed new, or rented in communities designed for families or communities designed for retirees, communities designed for workforce living or communities designed for recreational endeavors like golfing, boating, gardening, or going to the beach. So, you have the country’s largest non-subsidized segment of affordable housing populating a great majority of the land-lease homesites too? This little “niche” corner of the U.S. housing market, responsible most years for something less than 10% of housing starts, already makes up the most diverse, affordable, readily available and sustainable path to homeownership within a stressed market composed of eager and deserving consumers, the first-time homebuyers, the empty-nesters, and every person or family in between. MHV
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Land Use
HOW BROWNFIELD CAN WORK FOR NEW MANUFACTURED HOME COMMUNITIES by Matt Winefield
F
Finding land for manufactured home developments is challenging. A category of land to consider is brownfields. A brownfield is a property, the expansion, redevelopment, or re-use of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant. Typical brownfields include gas stations, strip malls with dry cleaners, plating shops, and petroleum storage/ processing facilities. The Environmental Protection Agency (EPA) estimates that there are more than 450,000 brownfields in the U.S. Many experts think that number could be closer to one million. Cleaning up and reinvesting in these properties increases local tax bases, facilitates job growth, utilizes existing infrastructure, takes development pressures off of 48 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
undeveloped, open land, and both improves and protects the environment. In many cities, such development can help ease housing crises. Of course, only a fraction of these brownfield sites could be used for manufactured homes, but the fraction may be larger than you think. I’m going to address some common questions around locating and redeveloping brownfield sites.
Finding a Brownfield Location First, how does a potential manufactured home builder locate brownfields? Here are some sources to consider: • Local and federal contaminated site databases • Trusted advisors of contaminated site property owners • Lawyers and environmental consultants • Industrial, commercial, and land brokers
Components of a Purchase & Sale Agreement (PSA) The buyer likely wants not just a significant discount but the ability to tap responsible parties, grants, and old insurance policies that may contribute to the cleanup costs. The PSA needs to be written so the buyer isn’t precluded from chasing these sources. Recovery from old insurance policies typically has strict exclusions related to indemnities that the buyer provides the seller Also, the seller wants the PSA to help him or her sleep better at night. The sale price may be significantly less of a factor (I’ve had sellers pay me!) than protection from future agency action and third-party claims.
Decontaminating a Site Ten s of thousa nds of sites throughout the U.S. have been decontaminated and brought to beneficial use. But what are the steps for decontaminating a site? • The most important step to take when remediating a site is to hire a consultant with relevant experience and a track record with the environmental agency in charge.
• The technologies can be as simple as excavating and removing soils or as complex as installing a network of wells, extraction devices, and emission scrubbers. • Unfortunately, mistakes are very costly in this realm. For example, selecting the wrong remediation technology is more likely to cost you $200,000 than $20,000.
Environmental Justice and Perception Challenges • O ne must understand that there will always be a portion of the population unwilling to accept converted brownfields for residential use. The secret is to accept that fact and minimize those who want to make an environmental justice example of your development.
• To meet this challenge, every effort must be made to work collaboratively with environmental agencies. Do NOT cut corners. Effectively communicate your remediation results with stakeholders. MHV Matt Winefield is founder of Winefield & Associates, based in Long Beach, Calif. He is an engineer and businessman who has been supporting the redevelopment of contaminated properties since 1989. Contact him at MW@winefield.com.
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• T here are many sites not on environmental databases that owners don’t want to admit could be impacted. These owners need to go through the Five Phases of Grief before they accept they have a problem What will probably not work is cold calling a property owner. They may have accepted the fact that they have toxins in their soils, but they’re not going to discuss that challenge with a stranger.
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National Advocacy
Supporting the Industry as the Nation Emerges from the COVID-19 Health Crisis by Dr. Lesli Gooch, Mark Bowersox
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Throughout the ongoing COVID-19 health crisis, the Manufactured Housing Institute has been working to ensure its members and the industry have the tools and resources they need to support their business operations. From utilizing our strong relationships with the White House, U.S. Department of Housing and Urban Development (HUD), and Congress to ensure manufactured housing is included in federal economic stimulus packages to creating an online resource center to help assist members, to convening virtual webinars and roundtables so members could share information and best practices during the crisis, MHI has remained committed to its mission, focusing on advocacy and communications to ensure our industry can continue to thrive both during and as the nation emerges from the COVID-19 health crisis. »
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During the pandemic, manRental Assistance Program. This ufactured home community ensures there is no ambiguity To ensure residents owners and operators have gone among states and localities that above and beyond to work with manufactured housing residents are supported during residents. To ensure residents and providers can receive support these challenging are supported during these from the program. times, manufactured challenging times, manufactured As the nation recovers from home community owners and the COVID-19 health crisis, home community operators have enacted rent MHI continues to work with the owners and operators repayment arrangements and administration and Congress to waived fees. Moreover, some have address supply chain challenges have enacted worked to connect residents with that threaten to disrupt plant rent repayment social service resources including operations. In 2020, MHI sucarrangements and information about employment cessfully secured the first-ever opportunities, assisting them industry-wide alternative conwaived fees. with filing for government benstruction letter for our home efits, and helping young residents builders to overcome supply chain obtain access to virtual schooling. shortages caused by the crisis. Communities are now also workBecause of these shortages, in ing to ensure residents are able to access information March we successfully urged HUD to delay the effective about vaccines and register for them. date of the final rule updating the HUD Code. Because And it is not just community owners and operators the implementation period within the final rule was that are going above and beyond to support residents of problematic due to the impacts of COVID-19, HUD granted manufactured homes during these challenging times. MHI’s request to extend the effective date of the final rule, There is a shared goal between manufactured housing citing the current level of backlogs at manufactured home lenders and their borrowers to preserve housing stability construction facilities as well as supply chain slowdowns. and minimize displacement during this crisis. Lenders MHI also continues to call on the administration and are supporting their clients by making sure borrowers Congress urging federal intervention and necessary action are aware of options for assistance, establishing single to address the lumber supply shortage in the country. points of contact for customers, waiving fees, making MHI also supports the industry by keeping members flexible payment arrangements, and granting extensions informed of the quickly changing federal landscape, and modifications. including the almost daily changes to federal programs While manufactured home community owners, and policies that might impact them. In addition operators, and lenders are doing everything they can to to its regular newsletters and alerts, MHI launched ensure residents and owners are safe and secure, MHI is a COVID-19 landing page on our website to support continuing to support their efforts by ensuring rental assistance and financial mitigation measures for property managers are included in coronavirus relief packages. Due to MHI’s strong advocacy efforts, emergency rental assistance for both manufactured housing residents and community owners and operators was included in the recently passed COVID-relief stimulus packages. Further, MHI worked with the U.S. Department of Treasury to specify in its guidance that rental payments for site/lot rents, as well as utilities, late fees, and other expenses related to housing, were included in its Emergency 54 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
not only our members but any company in the industry looking for resources to help guide their team members through the crisis. While in-person meetings had to be canceled, MHI has ensured industry members have access to opportunities to learn, network and grow. Offering online webinars, meetings, meet-ups and other virtual events, industry participants could share information and best practices. Instead of hosting its traditional Winter Meeting, MHI reformatted the event to bring MHI members together to discuss topics of interest including zoning, financial
Dr. Lesli Gooch is the CEO of the Manufactured Housing Institute, the national trade organization representing all aspects of the factory-built housing industries. Mark Bowersox is a seasoned trade association executive with experience leading nonprofits at both the state and national levels. In his role as president of the Manufactured Housing Institute he is dedicated to elevating housing innovation and expanding attainable homeownership. Bowersox is a federally registered lobbyist and regularly speaks on behalf of MHI and the industry to a variety of constituent groups and industry associations.
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assistance for small businesses and landlords, the HUD Code, financing, and more. Attendees were able to participate in an open forum with their peers to ask, questions, share strategies, and best practices. Through the Manufactured Housing Educational Institute (MHEI), manufactured housing professionals were able to continue to participate in a wide range of online training and certification courses, with nearly 500 manufactured home installers being trained – double the previous year. MHEI also re-launched its Professional Housing Consultant (PHC) designation, an updated training program to help retailers increase sales and improve the customer experience. As we look ahead to the remainder of 2021, and the nation rebounds from the unprecedented challenges due to COVID-19, MHI will continue to ensure the industry has the tools and resources it needs to thrive. Not only will we continue to advocate the interest of the manufactured housing industry to the administration and Congress, but we will ensure our members have a business climate that is conducive to industry growth. MHV
State Advocacy
What is Being Done at the State Level to Address Zoning Practices, Challenges?
I
In recent years Pennsylvania has seen an increase in enforcement by local municipalities with zoning ordinances that blatantly discriminate against the placement of mobile/manufactured homes. Sometimes these actions can be remedied by a cordial letter reminding municipalities that there is a Pennsylvania Supreme Court case that was decided in 1986, Geiger v. North Whitehall Township, which says no municipality may prohibit the placement of a “mobile home” on private property zoned for single-family dwellings. The essence of the Geiger case is that if local zoning allows for single family homes then they must allow “mobile homes” since they are built, by code, as a single family dwelling. Unfortunately, that does not always work. When that happens, the homebuyer is forced to decide if they want to hire an attorney to fight the municipality or purchase a modular or site built home. Recently we have seen the retailer hire the attorney to represent their homebuyer.
When challenged with a legal threat, municipalities have backed down. We are also experiencing a rise in calls from local municipalities looking to us for guidance as they update their zoning ordinances and SALDO’s related to the development of manufactured housing communities. Because of this, PMHA is updating their sample zoning ordinance and researching the feasibility of developing a sample SALDO. We are also working on legislation that we hope to introduce yet this session to amend our state law, Municipalities Planning Code. Our goal with the legislation will be to update terminology (replace mobile home with manufactured home) and definitions, and use case law to make it clear that manufactured homes are single family dwellings and must be zoned as such without exception. — Mary Gaiski, Pennsylvania Manufactured Housing Association Executive Vice President
Fewer Zoning Emergencies in Regulated States The politicians here don’t hang their hat on home rule, in fact I don’t think it’s even mentioned in the constitution. Having said that, it’s easier in a state like this when a question comes up that provides for non discriminatory housing, and as far as I can tell in most states that’s not happening. You can put a manufactured home anywhere you can put a site built home, the only exception being on
a historical landmark in the state registry, and to get that they made compromises to put local jurisdictions at ease, other places have not made these compromises, but basically our law says that the local jurisdiction has the right to exterior characteristics like siding, roof pitch, and roofing materials, eaves, skirting to complement neighboring homes. Local officials are amazed by the best of what we do and terrified of the least of what we do. The state did away with rules for mandatory foundation, homes older than 10 years from date of manufacture, and a width requirement that all but eliminates single-wides. And If you want to succeed, you’re going to have to compromise. When we were engaged in this, we turned the conversation around from nondiscriminatory zoning to parity for manufactured housing. If you walk through the door of a local government office and talk about nondiscriminatory zoning they’re going think you feel they’ve already discriminated against you, whereas if you talk about parity, everyone wants parity. —Jess Maxcy, California Manufactured Housing Institute
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State Advocacy
While zoning can be a challenge in limited circumstances, the Ohio Manufactured Home Association was able to advocate for a change in law years ago that allowed permanently sited manufactured homes to preempt all local zoning ordinances on private property (except for municipalities per Supreme Court ruling). Having said that, a number of municipalities that can zone manufactured homes have worked with OMHA to permit permanently sited manufactured homes. It is worth emphasizing that all counties and townships which make up the vast majority of the state are prohibited from excluding permanently sited manufactured homes that meet the same aesthetics as site -built homes in a given neighborhood or locale (for example—roof pitch). — Tim Williams, Executive Director of the Ohio Manufactured Homes Association
Industry Trends
MONITORING YOUR ONLINE REPUTATION: WHAT YOU DON’T KNOW IS PROBABLY HURTING YOU by Darren Krolewski
58 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Industry Trends
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There’s an old proverb: What you don’t know can’t hurt you. Ah, ignorance. What bliss. But when it comes to today’s digital-savvy consumer, what you don’t know about your online reputation could be hurting potential business, and you may not even realize it’s happening. Think about it for a moment. It doesn’t matter whether you’re looking for an asphalt contractor or a new waffle maker, the odds are overwhelming that at some point in the search you’re going to turn to the internet to help you make the right choice. As online reviews have come to proliferate local search results, social media networks and e-commerce websites, the importance of maintaining a positive online reputation »
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has become a critically important part of the overall marketing mix. While 97% of business owners in an Ipsos MORI study agreed that online reputation was important, just 42% of businesses in a survey by B2B marketing firm Clutch said they took the time to monitor their online reputation on a regular basis. The value of a positive online reputation is well established. Consumers have said in multiple studies that what they read about a company online influences their buying deci-
consumers are saying about you online, the numbers may simply not be in your favor. In a previous edition of the MHInsider, we took a look at how to begin by getting a complete picture of your online reputation. While establishing a baseline is an important first step, reputation management is an ongoing process that requires time and attention. Fortunately, there are some simple things you can do yourself as well as automated tools that can make the job a lot easier.
It doesn’t matter if you’ve been in business for decades or are just getting started, if you ignore what consumers are saying about you online, the numbers may simply not be in your favor. -Darren Krolewski
sions. Online reviews, in particular, have been found by consumers to be highly credible, perhaps even as strong as personal recommendations. There’s also evidence that the trust and credibility conveyed online reviews factors into the algorithms that determine website search engine rankings. Less than half of the consumers surveyed by local marketing platform BrightLocal stated they would even consider using a business with fewer than 4 stars. Another study by ReputationX found that reviews of 1 or 2 stars failed to convert prospective customers 86% of the time. It doesn’t matter if you’ve been in business for decades or are just getting started, if you ignore what
Setup Google Alerts Setting up Google Alerts around keywords relevant to your company name, properties, brands, and key personnel is one of the easiest things you can do to stay in touch with what is being said about your brand online. It’s a free service, and while there are certainly more full-featured tools available, you can’t beat the price. Simply make your selections and Google will dutifully send you alerts on a daily basis right to your inbox.
Conduct Regular Brand Searches This one is a no-brainer. Make a list of the company names and other search terms that are most important
60 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
to your business. Simply set a calendar reminder to search Google and the major social media sites at some regular interval. At minimum, do so once a quarter. Run these searches more often if warranted by the level of your business activity. Pro tip: order your search results to show the latest results first so you’re not repeatedly combing through the same data set month after month.
Embrace Automation There is some type of tool or platform designed to help with just about any conceivable task that is worth doing related to Internet marketing. There are tools to help you actively monitor mentions of your company or brand online. There are tools to track how you appear in organic search results when specific keywords are entered. There are tools that enable you to easily respond to comments across the most widely used social media networks. There are even tools that help you proactively reach out to encourage positive reviews. Let’s take a look at three popular tools for handling important tasks related to monitoring your online reputation: social media, organic search results and online reviews. 1. Hootsuite With more than 18 million users and over 800 of the Fortune 1000 among its clients, Hootsuite is one of the most established and comprehensive tools built for social media management. This flexible platform makes managing multiple social networks a breeze, from creating and posting content, to keeping track of brand mentions, to
2. SEMrush SEMrush describes itself as an all-in-one digital marketing toolkit for online visibility and content marketing. At its core, SEMrush helps identify opportunities. Think of it as an online software package that performs the job of multiple tools you’d normally have to buy separately. Its tools related to keyword monitoring, organic search engine rankings and competitor analysis are still among the best available, despite having been around for nearly a decade and a half. While
there are other tools out there that may excel at specialized tasks, you’d be hard pressed to find a better value in one package. 3. MH.Reviews MH.Reviews is the online review management platform powered by MHVillage. Over the years, many of our best products have come about as solutions to challenges being faced by our customers or the industry as a whole. MH.Reviews is no exception, with the added distinction that we proved its usefulness on our own online reputation before making it available to our customers. MH.Reviews makes it simple to monitor online reviews in a single dashboard, manage replies across multiple review sites, and encourage positive feedback on the sites and networks
most relevant to the manufactured housing business. Run a free reputation report at MH.Reviews and see how your reputation currently measures up. Monitoring your online reputation may seem like yet another thing you need to concern yourself about while trying to focus on running your core business. But with a little effort and the right tools, you’ll be on your way to building that five-star reputation in no time. MHV Darren Krolewski is co-president and chief business development officer of MHVillage, the top website for manufactured homes, retailers, and communities, and leads efforts that generate 25 million annual visitors and home transactions of more than $3 billion.
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Industry Trends
engaging consumers in meaningful conversations. Hootsuite supports all the popular social networks relevant to our industry and around 20 more emerging networks that may soon become the next big thing.
Industry Trends
INDUSTRY TRENDS AND STATISTICS MHVillage and Datacomp combined efforts with industry partners MHI and Statistical Surveys to provide manufactured housing professionals updated annual trends and statistics from across the marketplace.
Competitive Advantage
COMMUNITY LIVING
MARKET SEGMENT
Site-Built Home $119 average price per square foot
4.3 Million estimated home sites
9% of new single-family home starts
Manufactured Home $57 average price per square foot
31% of new homes are placed in communities
RESIDENT SATISFACTION
22 Million people live in manufactured homes
76% of new manufactured homes titled as personal property (chattel)
62%
of all residents anticipate living in their homes for more than 10 years
90%
of people are satisfied with their homes
71%
of residents cite affordability as a key driver for choosing manufactured housing
38%
don’t anticipate ever selling their home
Data courtesy of
62 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Sources: 2019 American Community Survey 1-Year Estimates, U.S. Census Bureau’s Manufactured Housing Survey, MHI 2018 Consumer Research,Datacomp/JLT, and other proprietary sources. Without the prior written consent of MHI, reproduction, distribution, transmission, caching or other commercialization of MHI copyrighted or trademarked material is strictly prohibited. Used with permission.
Produced 94,390 Homes in 2020
MANUFACTURED HOUSING SHIPMENTS
Industry Trends
MANUFACTURED HOUSING PRODUCTION 100,000 80,000 60,000 40,000
34
U.S. Corporations
20,000 0
135
2017
2016
Single
Manufacturing Plants
2018
Multi
2019
2020
Total Data courtesy of
Source: Manufactured Housing Activity Industry Production, Shipments and Trend Report. ©Manufactured Housing Institute. Without the prior written consent of MHI, reproduction, distribution, transmission, caching or other commercialization of MHI copyrighted or trademarked material is strictly prohibited. Used with permission.
TOP MANUFACTURERS
TOP 10 RETAIL MARKETS
BY MARKET SHARE**
Manufacturer Clayton Homes Skyline-Champion Cavco Industries Legacy Homes American Home Star Hamilton Homebuilders Scotbilt Homes Inc. Jessup Housing Adventure Homes Elliot MH MFG Commodore Corp.
2020 MS 50.40% 14.26% 12.75% 2.78% 2.46% 2.03% 1.69% 1.59% 1.49% 1.42% 0.92%
2019 MS 49.75% 14.91% 12.63% 2.48% 2.19% 1.70% 1.51% 0.92% 1.55% 1.43% 1.07%
BY BTA*
Growth 1.31% -4.36% 0.95% 12.10% 12.33% 19.41% 11.92% 72.83% -3.87% -0.70% -14.02%
Manufacturer Growth Houston...................................15.89% Dallas-Fort Worth ..................-3.37% Austin, Texas ..........................12.04% San Antonio, Texas ...............-5.03% Detroit ...................................-43.26% Birmingham, Ala. .................. 11.41% Phoenix .................................. 26.30% Knoxville, Tenn. .....................19.81% Los Angeles .......................... -18.78% Tampa-St. Petes-Clearwater, Fla. ............................................ -3.22% *Basic Trade Area
Clayton Homes 50.40%
Skyline-Champion 14.26%
Cavco Industries 12.75%
Other **Based on official government records as compiled by Statistical Surveys Inc. The current data’s time period unit totals and Market Share will change as historical data is updated from the states. Any use of Statistical Surveys data without written permission is prohibited. ©Statistical Surveys Inc. Used with permission.
MHINSIDER.COM Data courtesy of
| 63
Industry Trends
MANUFACTURED HOME COMMUNITY RENT AND OCCUPANCY JLT MARKET REPORT NATIONAL AVERAGES (MAY 2021)
SITE RENT
OCCUPANCY RATE
ALL AGES: $550 MONTHLY AVERAGE AGES 55+: $627
ALL AGES: 92% MONTHLY AVERAGE AGES 55+: 96%
ANNUAL SITE RENT INCREASE
ANNUAL occupancy INCREASE ALL AGES: 1.1% AGES 55+: 0.3%
ALL AGES: 3.2% AGES 55+: 3.8%
Markets with Highest Rent
Markets with Highest Occupancy
Orange County, Calif. ........................................ $1,523 Santa Clara County, Calif. .................................$1,212 Los Angeles County, Calif. ...................................$998
Santa Clara County, Calif. ..........................100% (0%) Northern Colo...............................................100% (0%) Miami-Dade County, Fla. ............................100% (0%)
55+
55+
Santa Cruz County, Calif. .................................. $2,335 Orange County, Calif. ......................................... $1,152 Santa Clara County, Calif. ................................... $981
Santa Barbara County, Calif. ................100% (+0.2%) Santa Clara County, Calif. .....................100% (+0.5%) Ventura County, Calif. .............................100% (+0.1%)
Markets with Lowest Rent
Markets with Lowest Occupancy
Greenville, S.C. (MSA) ........................................... $252 Albany, Ga. (MSA) ..................................................$269 Lynchburg, Va. (MSA)............................................ $276
Genesee County, Mich. .............................66% (+4.1%) Kansas City (MSA) .................................... 76% (+0.7%) Bay/Midland/Saginaw, Mich. .................77% (+1.8%)
55+
55+
Gary/Michigan City, Ind. (MSA) ..........................$260 Greenville, S.C. (MSA) ........................................... $267 Albany, Ga. (MSA) ..................................................$300
Gary/Michigan City, Ind. (MSA) ...............60% (-1.5%) Monroe County, Mich. ....................................61% (0%) Las Cruces, N.M. (MSA) .................................66% (0%)
All Ages
All Ages
All Ages
All Ages
Markets with Greatest Increase in Occupancy All Ages
Manatee County, Fla. ...........................................13.5% St. Clair County, Mich. ............................................5.3% Austin, Texas (MSA) ................................................5.2%
55+ Source: JLT Market Reports. Detailed research on investment grade communities in major manufactured housing markets nationwide, including the latest rent trends, occupancy statistics and other valuable management insights. ©Datacomp. Reproduction in any form is prohibited without written consent. Used with permission. Data courtesy of
64 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
St. Clair County, Mich. ..........................................18.9% Kent County, Mich. ...............................................10.6% Gettysburg, Pa. (MSA) ............................................ 7.5%
$84,412.21
2020 National Average PRE-OWNED Home Selling Price
+8.3% $48,483.83
+10%
MHVillage.com Listing Data (APRIL 2020-MAY 2021)
TOP 5 MARKETS WITH AVERAGE NEW HOME LISTING PRICE GROWTH ABOVE NATIONAL AVERAGE Growth
Above Average
Indianapolis, Ind. (MSA)
12.57%
4.27%
Phoenix-Mesa, Ariz. (MSA)
12.47%
4.17%
Detroit-Ann Arbor-Flint (CMSA)
12.40%
4.10%
Las Vegas (MSA)
12.36%
4.06%
Orlando, Fla. (MSA)
11.83%
3.53%
TOP 5 MARKETS WITH AVERAGE PRE-OWNED HOME LISTING PRICE GROWTH ABOVE NATIONAL AVERAGE Growth
Above Average
Detroit-Ann Arbor-Flint (CMSA)
10.73%
0.64%
Charleston-North Charleston, S.C. (MSA)
11.19%
1.1%
San Diego, California (MSA)
11.23%
1.14%
Austin-San Marcos, Texas (MSA)
12.67%
2.58%
Jacksonville, Fla. (MSA)
14.88%
4.79%
MARKETS WITH LOWEST DAYS ON MARKET
Florence, S.C. (MSA)
Milwaukee-Racine, Wisc. (MSA)
Lexington, Ky. (MSA)
Gainesville, Fla. (MSA) ............................................................. 30 Miami-Fort Lauderdale, Fla. (CMSA)......................................34 San Diego (MSA).........................................................................36
Norfolk-Virginia Grand Junction, Beach-Newport News Colo. (MSA) Va.-N.C.
San Antonio, Texas (MSA) ........................................................38 Chicago-Gary-Kenosha, Ill.-Ind.-Wisc. (CMSA)................... 40
Source: Based on new and pre-owned manufactured homes listed on MHVillage.com from April 2020 to May 2021. ©MHVillage. Reproduction in any form is prohibited without written consent. Used with permission.
Data courtesy of
Industry Trends
2020 National Average NEW Home Selling Price
- PAID ADVERTORIAL -
Catching Up with Green Courte Partners A discussion with Green Courte Partners’ Chief Investment Officer, Bill Glascott Q: Provide some background on Green Courte Partners for those unfamiliar with the firm.
Q: What’s different this time around with Windward as compared to American Land Lease?
A: Green Courte Partners, or GCP, is a real estate investment firm based in Chicago that is focused on building industry leading companies within niche real estate sectors. We‘re currently investing our fifth private equity fund, which has over $540mm of equity commitments and gives us the ability to acquire about $2 billion of assets in the fund. Our active sectors include land-lease communities, active adult/independent senior living communities, and near-airport parking facilities, and we wholly own fully integrated operating companies in all three strategies. In 2018, we established our land-lease community operating company, Windward Communities, to manage our growing portfolio, which currently consists of 17 communities with approximately 6,800 home sites.
A: American Land Lease primarily consisted of age-restricted communities in sun belt/coastal markets whereas, with Windward, we’ve been more focused on acquiring all-age communities nationwide. Another key difference is that we have implemented and embraced rental home and in-house financing programs to appeal to a broader range of prospective residents.
Q: Briefly describe your history in the manufactured housing industry. A: Sure. Our team consists of long-time MH industry veterans, and GCP has been at it since 2003, when we started building our MH portfolio with several “one-off” property acquisitions in joint ventures with operating partners. Most notably, in 2008, GCP took the REIT American Land Lease private, which roughly doubled our investment in the space, and we rolled our legacy portfolio into that platform. By 2014, we had aggregated 59 communities containing more than 19,000 home sites in under ten years and were a top ten owner in the industry when Sun Communities acquired the portfolio for $1.3 billion. When we were ready to start investing in MH again in 2018, we were well positioned with deep sector experience on both the investing and operating sides and were able, in many ways, to “put the band back together,” starting with Chuck Crook, who led operations and sales at American Land Lease and is now our Chief Operating Officer at Windward Communities. As mentioned above, we’ve been able to build a portfolio of almost 7,000 sites since 2018 and look forward to more growth and being an active participant in the MH industry for years to come.
The 17 communities we currently own are located across six states (Michigan, New York, Ohio, Kansas, Missouri, and Nevada), with our largest presence in Michigan. We’re targeting growth across the country, but we think it’s important to build scale in each of our markets to help gain efficiencies and ensure we can deliver institutional-level property management and an excellent customer experience. Something that we established with American Land Lease, and that we’ve found to be universal in all of our strategies, is that happy residents/customers refer their friends, and referrals are our most productive and cost-effective marketing channel. Also, since we’re more focused on what we’d consider “workforce housing” these days, in contrast to the lifestyle-oriented age-restricted communities in the American Land Lease portfolio, we’re finding excellent opportunities to reposition underinvested communities as well as expansions of existing properties. We’ve found great opportunities in acquiring properties from sellers who care deeply about their residents, employees, and communities but who don’t necessarily have the capital on hand to update their communities by bringing in and financing or renting new homes, redoing roads and utilities, and renovating clubhouses and other amenities.
- PAID ADVERTORIAL -
Q: GCP and its principals have been through a few cycles in this business, but it’s a very competitive environment right now. How does GCP differentiate itself amongst all of the new entrants and old guard?
Q: What is your outlook for transaction volume in 2021? A: We expect a fair amount of activity this year. First, as we’ve seen in recent months, interest rates have been rising. The 10-year treasury rate recently increased above 1.70% from a low of 0.51% in August of 2020. Furthermore, the recently passed $1.9 trillion stimulus package and other external factors are threatening to increase inflation, which may put more upward pressure on interest rates. Second, if the Biden Administration’s proposed changes to the tax code are enacted, they will have severe implications for real estate owners. While the exact timing and makeup of the proposed changes haven’t yet been settled, the changes being pursued that would be the most impactful to property owners are as follows: 1. Capital gains tax rate – the Biden proposal increases the federal rate from 20.0% (for the top bracket) to 39.6% (the top income tax rate). 2. Elimination of step-up in basis – there are two different versions of this under consideration; the first would impose a tax at death on unrealized appreciation, and the other would provide a carry-over of the decedent’s tax basis. Under either approach, a significant amount of asset appreciation that would’ve passed on to the property owner’s heirs would be transferred to Uncle Sam. 3. Elimination of the 1031 exchange – 1031 exchanges currently provide owners a way to defer capital gains taxes indefinitely by reinvesting the proceeds from a sale into new real estate assets; this change would entirely eliminate this significant tax deferral benefit for real estate investors. We’re finding that these concerns are prompting many long-time owners to survey the current landscape and, with cap rates as low as we’ve ever seen them in MH, seriously consider transacting now to get out in front of these potential material impairments to the net worth they’ve built over many years of hard work owning and managing their communities.
A: While we realize we’ll always need to be competitive on price, we think we have a demonstrable track record of doing right by sellers, residents, and employees in this industry. Many of our sellers and partners have owned their communities for multiple generations, and that can often create the need for a pretty creative and thoughtful approach to working with potential sellers that goes well beyond just arriving at the highest cash price. First and foremost, we pride ourselves on tailoring transactions to meet the needs of our counterparties. We have helped community owners work through complicated family and partner dynamics, generational wealth transfer priorities, and concerns about key employees and residents, not to mention the tax considerations described above. We can move very quickly, and we are known for delivering consistently on the terms to which we’ve committed. We have full discretion over our investment decisions and can access capital within ten business days (we currently have over $500mm of equity “dry powder,” which, again, translates to roughly $2 billion of asset buying power). In keeping with our focus on customizing transactions for individual sellers, in addition to standard asset and portfolio acquisitions, we have extensive experience with a variety of structured transactions, joint ventures, and tax efficient exits. Today, we’re finding that sellers particularly want to tap into our expertise in helping them consider the tax implications of a potential sale. As an example of our unique approach to working with sellers, a couple of years ago, we completed a joint venture with HomeFirst Communities, which was a family business led by Kenny Lipschutz. Kenny had scaled the HomeFirst portfolio and lived and breathed every aspect of that business for many years. We had known Kenny for a long time and, when he and his family decided it was time to explore their options, we sat down with him and listened to their priorities. We were able to craft a transaction that both accomplished their economic objectives and aligned with their values and vision for their employees and residents. Kenny has been a great partner and is helping us grow the Windward portfolio to be a leader in the MH space.
Acquiring Land-Lease Communities Nationwide Bill Glascott
BillGlascott@GreenCourtePartners.com
Jordan Kerger
JordanKerger@GreenCourtePartners.com
www.GreenCourtePartners.com
Industry Trends
The Manufactured Housing Industry Post-Covid How a Worldwide Pandemic Has Fundamentally Changed Our Business by Darren Krolewski
68 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Industry Trends
A
As far as I know, there’s no playbook for dealing with the aftermath of a pandemic. Even as the experts struggle to find new adjectives to describe the unprecedented events we all experienced over the last 18 months, recent indications suggest that we may finally be nearing the threshold of a post-pandemic return to normalcy. Vaccination numbers continue to rise. COVID cases, and the severity of those cases, are on the decline. Restrictions are being eased. Workers are returning to their offices. In-person events are on a comeback. While the safe bet may be to remain cautiously optimistic, the progress is certainly positive, if not a bit tentative. But that’s how it’s been since the beginning. If there’s a trend that emerged in the past year, it’s uncertainty. Who would have ever expected that a potential economy-ending apocalypse would have resulted in the creation of historic consumer demand for housing? Yet despite all the unknown territory that we have collectively navigated, there is one undeniable truth that has emerged from all of this. The pandemic has fundamentally changed our business. And for many of us, far-reaching effects will persist long after the pandemic is behind us.
Consumer Expectations Have Changed Some of the earliest adaptations we had to make as an industry were in response to rapidly shifting consumer preferences. This time the driver was more than convenience, it was health and safety. Physical showings and open houses were replaced by virtual tours and video walkthroughs. Walk-ins became scheduled video conferences. In-person closings went curbside. For many in our industry, this was uncharted territory. There was a lot of “figuring it out”. It involved changes to processes, procedures and our own comfort with technology. Nowhere was the shift in preferences more apparent than MHVillage, where our website is on the front lines when it » MHINSIDER.COM | 69
Industry Trends
comes to identifying rapid changes in consumer sentiment. Like many companies, as the market pivoted we responded to the needs of our customers by developing a virtual open house product, supporting new virtual tour formats and making it possible to include more photos across our listing categories, all in record time. These changes were essential to serving the needs of our customers, so they could continue to serve their customers. Even as the pandemic subsides, these enhancements are helping to make the consumer experience better. Much like online order pickup, same day delivery, and movies that stream the same day they hit movie theaters, many of the improvements companies made to serve their customers during the pandemic are here to stay. They’re no longer optional. They’re expected.
The Concept of Home Has Changed Because of our leadership position in housing affordability, manufactured housing has always been at the forefront of preserving the American Dream. That dream is more important than ever in a post-pandemic world. Home is security. Home is comfort. Home is uniquely individual. The events of the past year have brought the concept of home into even greater focus as kitchen tables became classrooms and bedrooms transitioned into work spaces. What consumers want in a home has evolved. More space. More function. Multipurpose areas. Outdoor living. It goes beyond having a home office for those able to work remotely.
For some, economic realities have necessitated adult children to move in with their parents. Likewise, many adult children have had to become caregivers to one or more of their aging parents. People have taken on new hobbies. Started home businesses. Turned that formal dining area into a fitness room. Retired earlier than anticipated. The demands on the home are greater and will shape the features and amenities we build into our product for years to come. And it’s not just the product. It’s also the location. Suddenly, people don’t have to live near where they work. They can live on a lake. Or in the woods. You’ve heard about the exodus away from the major urban centers. That trendy, pricey apartment near downtown became less appealing when everything was closed. Location has always been everything, and the pandemic has prompted consumers to evaluate where they live as much as how.
Interest in Manufactured Housing Has Changed There’s a well known aphorism that “a rising tide lifts all boats”. One might say that’s true about the overall housing market and the manufactured housing industry. As site-built housing inventories remain at all time lows and residential real estate prices continue to push the boundaries of sanity, let alone affordability, interest has slowly turned to manufactured housing as a potential solution. Whether it’s the desire for a more affordable alternative, a better method of building a second home or an accessory dwelling unit (ADU) as an income
70 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
property, the pandemic may be the catalyst for sustainable heightened levels of interest in manufactured housing, at least as long as the residential real estate market continues its ascent. Point2, a division of Yardi Systems, recently cited that 23 U.S. states have seen manufactured home searches increase by 50% or more according to Google Analytics data. This increased activity in consumer interest is mirrored by our internal data at MHVillage, which saw yearover-year increases in search volume ranging from 52% to 149% in many markets at various points during the pandemic. While the roller coaster ride that was the early weeks of the pandemic has stabilized, the year-over-year increase in national search activity continues to hold in the 35 to 40% range and shows no signs of abating. Backlogs are evidence of that. Backlogs to get homes. Backlogs to get homes delivered and set. Backlogs to get on-site work completed. This may be the new normal for a while.
Our Embrace of Technology Has Changed Our industry has historically not been one for early adoption of technology. When the day comes when manufactured home buyers want to pay for homes in cryptocurrency, I can assure you that MHVillage will be one of the first to support it, but as an industry, we tend to favor a more decided approach. We like what’s reliable, tested, proven. All things that tech advancements often are not. That said, the industry has been on a technology trend. Pandemic-fueled »
STRENGTH IN NUMBERS
1.5 MILLION
PHONE & TEXT LEADS SENT TO ADVERTISERS
25+ MILLION UNIQUE VISITORS ANNUALLY
$3+ BILLION
TRANSACTION VALUE OF HOMES SOLD OR RENTED
If you’re not on MHVillage, the most active website for manufactured housing, you’re simply missing out!
More Traffic. More Leads. More Sales (800) 397-2158 | MHVillage.com Already a Client? Contact Us for a Complimentary Marketing Review of Your Account.
$18,000,000 Loan ILLINOIS
$3,262,000 Loan ROCHESTER, NY
$4,550,000 Loan UTAH & WYOMING
$3,187,000 Loan ALBANY, NY
With over $375,000,000 closed in 2020, Security Mortgage is excited to continue providing great rates and terms for their MHC clients in 2021.
2370 Monroe Avenue, Rochester, NY 14618 Anthony@securitymortgage.com Gd@securitymortgage.com 72 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Industry Trends
Our technical team has done more integrations with third-party software on behalf of our clients in the past year than we’ve done in the five years previous. This isn’t going to go away. If anything, success with technology is going to accelerate these decisions. -Darren Krolewski
business growth has necessitated changes to internal systems to support higher levels of activity. Months of travel restrictions put a renewed emphasis on everything from property management systems and online resident screening platforms to remote monitoring systems and apps where residents can submit concerns or maintenance requests. We all seemed to take the opportunity to find better ways to run our businesses. At the very least, perhaps priorities have shifted, affording time to tackle long standing projects that just never seem to progress among the usual gauntlet of in-person meetings, site visits and industry-related travel. Our technical team has done more integrations with third-party software on behalf of our clients in the past year than we’ve done in the five years previous. This isn’t going to go away. If anything, success with technology is going to accelerate these decisions.
The Cost of Doing Business Has Changed One of my colleagues recently forwarded me an internet meme that read: “I have a sheet of thick plywood. Will trade for 2018 or newer Corvette. No lowballers. I know what I have”. Has anyone seen the price of lumber lately? Seriously, it’s no joke. What goes up is supposed to come down, but sadly that never seems to be the case. At least not as quickly as anyone would like. Everything has gotten more expensive during the pandemic. Raw materials. Freight. Services. Labor. Labor, that is, if you can find it. I’ve read a number of articles recently that pretty much said the combination of heightened demand during the pandemic coupled with increased order volume for the impending recovery has created backlogs for everything, everywhere. Hot tubs. Generators. Pickles. Yes, pickles. Apparently they can’t get the jars. I missed the boat on patio furniture last summer, so when the order
I placed then finally arrived a couple weeks ago, I thought I was in good shape. Until I went to order another matching piece. Backordered until October. Oh well, maybe next year. I don’t think there’s anyone who hasn’t been affected by a shortage, surcharge or delay related to at least one aspect of their business. It takes a toll on productivity and on profits. From the looks of demand, it may be some time before there is any relief. Ultimately, and perhaps most importantly, the way we do business has changed. It had to, and mostly for the better. As we near the turning point of the pandemic, we may all be able to finally breathe a sigh of relief and get back to the usual array of non-COVID challenges. We’re incredibly fortunate, as industry, and as a company. I, for one, will do my best to never lose sight of that. There may not be a playbook for dealing with what comes next, but that’s the best part. It’s an opportunity to write the next chapter of our own future. MHV
MHINSIDER.COM | 73
MHInsider and Fannie Mae collaborated on the development and publication of the enterprise’s summary of learnings regarding the secondary financial market for manufactured homes on land.
Increasing Liquidity for Manufactured Housing Titled as Real Property PUBLIC SUMMARY OF LEARNINGS
Loan purchase growth is the most direct measure of Fannie Mae’s commitment to this underserved market.
One of the drivers of the increased loan purchases has been the expanded eligibility of loans that lenders can deliver to Fannie Mae.
As compared to calendar year 2017, there were 27.4% more lenders delivering Duty to Serve-eligible MH loans to Fannie Mae over the 12-month period prior to October 2020.2
By the simple measure of the average number of loans purchased in the three years of Duty to Serve (2018–2020) compared to the three years preceding Duty to Serve (2015–2017).
53%
more loan purchases in the MH market1
Fannie Mae has made six major policy changes and adopted three significant variances related to MH.
27.4%
more lenders delivering Duty to Serve-eligible MH loans
1
Period beginning October 1, 2019 and ending September 30, 2020. For reference, the total number of active Fannie Mae lenders was stable during the same period, increasing by less than 0.1 percent.
2
© 2021 Fannie Mae 74 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
Read the full report at fanniemae.com/dutytoserve
WE HAVE THE DATA The Nation’s Most Comprehensive Source of Market Data for the Manufactured Housing Industry YOUR COMMUNITY Rent: $997/month Occupancy: 94%
COMPETITOR #1 Rent: $949/month Occupancy: 89%
COMPETITOR #2 Rent: $1,100/month Occupancy: 96%
COMPETITOR #3 Rent: $1,249/month Occupancy: 98%
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MANUFACTURED HOME LENDING AND FUTURE POTENTIAL by Paul Barretto
The manufactured housing industry is enjoying a strong start to a promising year that began with a hot housing market. Fueled by continued growth in the demand for housing that began during the pandemic and the lack of existing housing supply, manufactured housing is becoming more mainstream. As of the first quarter, 20% more new manufactured homes were produced in comparison to the first quarter of 2020. Manufacturers are working hard to meet production demand and shorten their backlog of orders. The financing needed to purchase either the home itself, or the home and land together, is an important part of keeping the industry’s momentum. Understanding the financing of manufactured housing is a way to understand the dynamics facing the manufactured housing industry. »
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What is the Difference Between Chattel and Real Property Financing? Home only financing, also referred to as chattel or personal property financing is supported by lenders, banks, credit unions and other financial institutions experienced in this type of lending. The number of lenders providing financing is limited in comparison to home and land, or real property lending. 21st Mortgage, Vanderbilt Mortgage, Triad Financial, Credit Human, and Cascade Financial are some of the familiar names in chattel lending. These lenders usually originate, service, and retain these loans in their portfolio. A few lenders originate the loan, sell it to an investor but will service the loan on their behalf. Chattel financing takes less time to originate,
process and settle a loan than home and land financing because it does not have the same standardization, regulations, and titling requirements as real property financing. Chattel financing makes up approximately 77% of manufactured home lending according to the U.S. Census Bureau. When a manufactured home and the land it is attached to is titled, or recognized as real property, or real estate, it is eligible for government and conventional fixed rate mortgage financing. This type of lending is highly standardized, regulated, and the loans can be sold on the secondary market. Access to the secondary market is a significant difference that separates chattel from real property lending. The secondary market allows lenders to sell their low interest, 30-year fixed
rate loans to investors directly, or entities such as Fannie Mae, Freddie Mac, and Ginnie Mae who create, sell, and guaranty mortgage bonds to secondary market investors on a large scale. However, the time it takes to originate, process, and settle a loan is much longer than chattel financing, think months versus weeks. Land Home Financial, CIS Home Loans, CountryPlace Mortgage, and Guild Mortgage are familiar names in the industry but national institutions such as Wells Fargo and Bank of America, and other recognized mega lenders are approved to sell real property loans to Fannie Mae, Freddie Mac, and Ginnie Mae. Real property lending makes up approximately 18% of lending on manufactured housing according to the U.S. Census Bureau but is served by a greater population of lenders.
What are Lenders Thinking? Manufactured home lenders are optimistic about the housing market and their ability to provide financing to consumers looking to buy a manufactured home. They are enjoying a healthy mix of new purchase business in line with the demand for housing, and refinances as borrowers look to take advantage of the lower interest rates. While chattel lending rates have been stable there is an expectation of a slight increase due to the dependence on the cost of funds since there is no secondary market. The interest rates for real property loans can change daily as they are tied to the secondary market. Most economists anticipate the 30-year fixed rate to increase in 2021 but remain relatively low. Access to relatively low interest rates 78 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
for both chattel and real property loans makes housing more attainable for home buyers but the increasing housing prices are having an adverse impact. Some lenders are taking the longterm view on housing and see the increased home prices as a temporary phase until the supply of materials and appliances normalizes, and manufacturers gear up to reduce backlogs. They see the demand for housing and low interest rates as reasons for their confidence.
What Worries Most Today’s Manufactured Home Lenders? Lenders are concerned about their staff given the increased workload and continued stress of the pandemic. In addition, they worry about losing productive talent to their competition or other industries as the job market for skilled processors, underwriters and other positions is extremely competitive due to the demand for financing. Acquiring new talent is equally difficult for the same reason. It is challenging for lenders to manage loan pipelines and plan for the future when they are worrying about retaining and building their workforce to keep up with their loan volume. The manufacturing backlog is another concern as the credit report, appraisal, and other loan documents used to approve borrowers for their loans are at risk of expiration. If the qualifying loan documents expire, lenders are required to requalify the borrowers which creates the risk that they may not be re-approved. Lenders are reporting the average days a loan remains in their pipeline before closing is growing and a concern.
Photo Courtesy of Loma Vista Communities
As manufactured housing becomes a greater share of housing in America, access to financing will be there to support the growth. -Paul Barretto
The Road Ahead for Manufactured Home Lending Both chattel and real property lenders are optimistic about the future. Lenders expect their 2021 loan volume to match or exceed their 2020 business. They predict the demand for manufactured housing will continue to grow fueled by the country’s low housing supply, relatively low financing rates, and the mainstreaming of today’s manufactured homes. There are opportunities just around the corner that underscore their optimism. Last year’s chattel securitization created optimism in the lending community as it demonstrated secondary market investor interest in chattel loans. A few real property lenders started offering chattel loans as they are seeing interest from banks and
depositories interested in CRA (Community Reinvestment Act) credit and non-traditional investments. Despite the lack of support from Fannie Mae and Freddie Mac, the interest and demand for chattel loans appears to be growing. New manufactured housing communities are being created, and existing communities are expanding as more consumers are recognizing the value and affordability of community living. While zoning and other forms of exclusion remain an obstacle, the industry is seeing more progress in comparison to five years ago. Chattel lenders provide financing to the residents and are anticipating more growth. The Duty to Serve efforts by Fannie Mae and Freddie Mac will continue to increase the amount of » MHINSIDER.COM | 79
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real property lending as they push for more lenders to include manufactured home lending in their offering and support the mainstreaming of manufactured housing as an important solution to the housing gap that exists in America. Both Fannie Mae and Freddie Mac have reported sig nif icant increases to their manufactured housing business as their policy changes supporting manufactured housing are adopted, and more lenders have added manufactured home lending to their offering. Since they are unable to move forward with their chattel pilots, these government sponsored enterprises (GSEs) are committed to dramatically increasing their real property activity to raise the level of awareness in today’s manufactured housing.
The upcoming changes to the HUD Code for Manufactured Housing will lead to more lending as they create new opportunities for manufactured housing. The update supports the creation of manufactured homes in townhouse-like structures, 2–4-unit manufactured homes, and makes it easier for two-story manufactured home construction. These updates support manufactured homes as a solution for urban and suburban in-fill, which helps address affordable housing challenges. As manufactured housing becomes a greater share of housing in America, access to financing will be there to support the growth. Fannie Mae and Freddie Mac are required by the Duty to Serve to push for greater adoption of manufactured housing financing among their approved
lenders through their policies. MHI, MHARR, and the state associations continue to address the challenges facing the industry at the national and local level which also supports growth. Manufactured housing lenders see a bright future which bodes well for the industry. MHV Paul Bar ret to i s the executive director and founder of Manufact ured Hou sing Initiatives, a consulting group focused on the success of factory-built housing. He also serves as director of LearnMH and works as a resource for positive change in the offsite factory-built housing industry. FOR MORE INDUSTRY NEWS, VISIT OUR BLOG AT
MHINSIDER.COM
MHEI’s Accredited Community Manager (ACM®) Certification Earn Your ACM Online In a world where almost everything can be done virtually through the comfort of your own home or office— access MHEI’s Accredited Community Managers (ACM®) curriculum online. Manufactured housing communities can represent million or multi-million dollar investments that deserve professional management. The ACM courses cover hands-on financial management challenges which were written by a team of industry experts. This program educates the land-lease community operators on issues unique to their career. The Accredited Community Manager (ACM) certification was developed by the Manufactured Housing Educational Institute to raise the standard of training for manufactured housing community managers.
Please contact education@mfghome.org for more information. Manufactured Housing Educational Institute | 1655 Fort Myer Drive, Suite 200, Arlington, VA 22209 80 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
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A PRIMER ON THE HUD CODE Part I: The Manufactured Home Consensus Committee by Devin Leary-Hanebrink
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This past January, HUD published its “third set” final rule amending the HUD Code. The effective date was originally March 15, 2021. However, in response to requests from
the industry — HUD has maintained jurisdiction over the construction, safety, and administrative rules for manufactured housing. (Technically, the 1974 Act was originally titled the
several manufacturers struggling with delays caused by the COVID-19 pandemic, HUD agreed to postpone implementation. The new date, Monday, July 12, gives manufacturers and other stakeholders more time to navigate production backlogs and implement the required system updates necessary to comply with the new regulations. While the final rule is important, perhaps a more fundamental question is: How is the HUD Code even updated? For many manufactured home professionals — including more industry veterans than would probably care to admit — how the HUD Code is updated remains cloaked in a bit of mystery. After this twopart column, readers should better understand the HUD Code and the rulemaking process.
National Mobile Home Construction and Safety Standards Act, but the title was retroactively amended by the Housing and Community Development Act of 1980, which also replaced every instance of “mobile home” with “manufactured home”.) Decades later, the Manufactured Housing Improvement Act of 2000 (the 2000 Improvement Act) substantially amended the 1974 Act. While the 2000 Improvement Act introduced several important updates, the creation of the Consensus Committee is critical to understanding how the HUD Code is amended.
The Manufactured Home Consensus Committee
Since 1974, when the National
The Consensus Committee — more commonly known as the Manufactured Home Consensus Committee or MHCC — is a federal advisory committee that provides recommendations to HUD regarding the adoption, revision, and interpretation of the manufactured housing construction and safety standards
Manufactured Housing Construction and Safety Standards Act (the 1974 Act) was signed into law—establishing a federal minimum standard for
and the procedural and enforcement regulations (more commonly referred to as the HUD Code), among other responsibilities. It effectively »
The Manufactured Home Construction and Safety Standards Act
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meeting, and hold all meetings open and available to the public, whether meeting in-person, virtually, or via conference line. The MHCC also is expected to operate in conformance with procedures established by the American National Standards Institute. Finally, all MHCC recommendations approved by HUD must go through the APA’s notice-and-comment rulemaking process to ensure the public has an opportunity to review and comment on the proposed changes before becoming law. In the next column, we will cover the HUD Code and the amendment process, from the initial steps, where proposals are submitted to HUD for MHCC review, through the final stages of the APA rulemaking process and the publication of a final rule. MHV Devin Leary-Hanebrink practices with McGlinchey Stafford PLLC. He helps clients navigate the alphabet soup of state and federal government agencies that regulate a wide range of industries, including banking, consumer financial services, housing, and construction. McGlinchey Stafford PLLC is a multi-service law firm with a national presence, serving clients from offices in Alabama, California, Florida, Louisiana, Massachusetts, Mississippi, New York, Ohio, Tennessee, Texas, and Washington, D.C.
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Federal Oversight of Advisory Committees Like all federal advisory committees, the MHCC is subject to several administrative and public access requirements, including the Administrative Procedure Act (APA) and the Federal Advisory Committee Act (FACA). For example, in accordance with the 1974 Act as amended and the FACA, HUD is required to convene the MHCC not less than once during each two-year period, publish in the Federal Register advance notice of each meeting, including advance notice of any subcommittee
STEPS • DECKS
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replaced the 1974 Act’s National Manufactured Home Advisory Council. The MHCC is composed of 21 HUD-appointed voting members, none of whom can be federal government employees, and one non-voting member who represents HUD. (The Program Administrator for the Office of Manufactured Housing Programs is HUD’s Designated Federal Official.) To promote diverse perspectives, voting members are divided into three groups: • Seven producers or retailers of manufactured housing (Producers) • Seven members who represent consumer interests, such as manufactured home residents or consumer organizations (Users) • Seven general interest and public official members (General Interest). The Producers and Users are self-explanatory, and General Interest is less clear; while this group typically consists of representatives from the Primary Inspection Agencies and State Administrative Agencies, it can include other representatives, such as industry consultants and advisers. Further, to promote independence and prohibit collusion, the 2000 Improvement Act also introduced additional safeguards, including term limits, staggered terms, supermajority voting provisions, and a financial independence test and post-employment ban for some members. The MHCC has established four subcommittees—the Regulatory Enforcement, Structure and Design, Technical Systems, and General subcommittees—each responsible for different parts of the HUD Code. Proposals that require a more comprehensive review, such as technical changes to plumbing or electrical provisions, might be delegated to a subcommittee, which will then report back to the MHCC with recommendations.
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Housing Policy
GOVERNMENT RENT MORATORIUM
and the Negative Long-Term Effect by Matthew I. Paletz
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The Biden administration and the Centers for Disease Control and Prevention (CDC) again extended a moratorium on housing evictions through the end of June 2021 just days before the prior moratorium was set to expire on March 31. As housing advocates continue to convince the U.S. and individual state governments to extend the moratorium through the pandemic, more than 10 million Americans are behind on rent or mortgage payments, and more than five million say they are at risk of eviction or foreclosure, according to a recent Census Bureau survey. But one of the most underreported fallouts from seemingly interminable government COVID rent moratoriums
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and rental assistance programs, is the impact that more than a year of “bad” rental debt is going to have down the road for both landlords AND tenants. As a reminder, rent moratoriums do not erase the contractual obligation of people to pay their rent. Neither does it erase the obligation landlords have to pay their mortgages. There is no magical black hole for the debt that has accumulated during this period of government sanctioned rent suspension. To be frank, it’s going to affect all of us, landlords and property owners as well as renters and taxpayers.
Housing Policy
My biggest question has been this from the beginning: if the government, both through federal stimulus and state legislative distributions (which have become political and slow, at best) continues to send out checks for rental assistance, why do we continue to need a moratorium? Eviction, as every landlord and property owner knows, is a natural part of a tenancy contract and if they cannot legally hold their tenants to these contracts, there is no real incentive for renters to negotiate payment if they can live there perpetually for free. This is not unlike the recession of a dozen years ago, when homeowners who could not pay their mortgages sat in their dwellings for sometimes years, rent-free, before the banks finally foreclosed on them. The banks did not want the home inventory then and I can guarantee they do not want it now if these moratoriums cause property owners eventually to walk away. You don’t have to look very far into the future to fully understand the long-term implications of these state and federal government rent moratoriums. Eventually, those who can’t pay their current or back rent are going to find themselves harnessed with a form of renter double-jeopardy when they are evicted and looking for another place to live. Specifically, not only are landlords going to be forced to raise rents to make up for COVID-related shortfalls, pricing many renters out of the market, but they’re also going to tighten the process of financial pre-approvals, a bar many renters will not be able to meet. Of course, government “solutions” like rent abatement and assistance programs are almost always short-term, knee-jerk fixes to much bigger problems. In this case, these programs are going to adversely affect, on a continuing basis, the people they were meant to help. As another example of the federal government run amok is the incredulous situation that the CDC is writing and enforcing housing policy, a matter that as of press time remained under federal review. Even now, despite its authority being struck down in federal courts in Texas, Ohio and Tennessee, the moratorium was extended.
These moratoriums and subsequent accumulated debt will affect a renter’s credit rating, their reputation and financial status for years and years. So landlords, even when they do legally get their properties back, may have a lot of hesitation in renting to an applicant with more than a year of bad debt. The result is going to be that an awful lot of people needing a place to live will have very few options due to the government’s short-sighted policies. And no one can blame the landlords for not taking on any tenant who looks like a potential payment risk after all they’ve been through in the last year. As a result, this bad rental debt will not only keep families from finding affordable housing in the future, but financially will leave landlords holding the bag if these tenants file bankruptcy. Then, the next logical domino to fall is local municipalities, which are going to find themselves cash-strapped due to a lack of revenue and will in turn undoubtedly raise taxes and add more red tape to their housing oversight, costing everyone additional money in fees and other regulations. Again, a foreseeable consequence that will negatively affect renters. Anyone who follows these types of government programs could see from a mile away how this overreach, which I find unconstitutional, would disrupt the delicate balance between landlords and tenants. Bottom line is this governmental interference is unsustainable, and the negative effects will be with us all for years to come. MHV Matthew I. Paletz is the CEO of Paletz Law and he is licensed to practice in Michigan and Ohio. He is a leading national advocate and supporter of legislative efforts on behalf of the real estate industry with his practice emphasis dedicated to landlord-tenant law, nationwide fair housing defense of property owners, and protecting the rights of creditors in bankruptcy. Paletz Law is on the cutting edge of technology and offers PaletzTrack, an online software platform and mobile app. You can find them at www.PaletzLaw.com
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Photo Courtesy of Tharakan Consulting
Efficiency / Sustainability
Submetering Technologies Support Water Conservation, Cost Tracking, Loss Prevention by Bill Baird
E
Even as a native Coloradan, whenever someone says “The Rocky Mountains” I tend to envision snow covered mountain peaks. It does not take long before my mind wanders off to cabins buried up to the roofline, or of someone braving deep snow between endless tree lines in a winter storm. While on occasion this does happen in certain regions of Colorado, the high ridges do not produce as much moisture or water supply as one would think. Consider the 2019-2020 winter. Colorado had record-breaking snow accumulation, yet still managed to have drought conditions that listed the state and region among the driest in the U.S. And there’s the direct correlation to record-breaking wildfire burns throughout the region. More than 700,000 acres burned in Colorado, which matched the wildfire season in Arizona and Washington. California took an estimated loss of 4.1 million acres, Oregon lost a million acres, and Utah had more than 300,000 acres of land burn.
Cost, Demand, and Conservation Throughout the Midwest water rates trend upward. In Centralia, Mo., in just three years’ time, water usage rates for 4,000 gallons have increased 39% from $16.94 to $23.62. St. Paul, Minn., will increase its rates by 2.45% in 2021. Sample research batches through the Midwest have shown water increases will be in effect in 2021 at 2.5% to 6%. If communities are not submetering their water, it will ultimately affect their cap rate and even at a 5% annual increase during the next 14 years the water prices will double. There is a lengthy list of questions on how water use efficiencies are achieved. Most have definitive answers and others remain to be solved. • How do we equate the necessary daily water consumption one needs vs daily water waste? • H ow do proper dat a a na ly t ic s equate to water conservation? »
MHINSIDER.COM | 91
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Figure 1 – One Minute Data
Figures 1 & 2 shows how WaterScope from Metron can identify water consumption usages such as irrigation, showers, toilets, dishwashers to washing machines! The importance of knowing this data is somewhat unlimited because one can determine if their consumption usage is high due to long showers, over-watering, defective toilet flappers, and so on. They can address each leak with the usage alert system in place.
Efficiency / Sustainability
Advanced engineering and creative software solutions have supported water submetering’s rise in the market, including in manufactured housing communities, not via the conservation efforts we’ve discussed, but because submetering is a nominal investment that pays immediately, and pays off quickly. Metron has been a leader in a category that is constantly improving and innovating. The company has made an art of tracking water flow down to the drop with smart water meters and proprietary cloud-based analytics. This approach compels residents to consider their daily water consumption, to identify even the smallest water leaks, to identify costly water breaks immediately, and to look for significant cost reductions for water delivery and usage.
Capturing water consumption downstream is especially important, yet the question remains, where has all the water gone that was billed by the municipality but not captured on the submeters? For instance, how old is the municipal meter? Some are 40 years old or older. One solution is to track these unknowns with Metron’s WaterScope to monitor what goes through a main meter as well as what is captured downstream. This can be done in real time. Our results have shown 46% difference between water going through a main meter and submeter. WaterScope will compare and analyze the water flow daily to identify infrastructure leaks and send out an alert if the set threshold is surpassed. All the meters are timed synced allowing for accurate flow measurement via Verizon connectivity. In theory, community owners and operators want to see as little loss as possible, limiting or eliminating the unbillable water. And if an infrastructure leak goes unnoticed it will eventually erode the ground, causing even more damage to the property.
Figure 3 – Infrastructure Leaks
Figure 2
Figure 3 Shows the importance of the master and submeters to provide a true water management system for a community. MHV
MHINSIDER.COM | 93
The Allen Legacy Photo Courtesy of UMH Properties
45 Year Partnership Between HUD & Manufactured Housing by George Allen, CPM Emeritus, MHM-Master
H
‘How a Regulatory Lemon Evolved Into Lemonade for the Industry’
What follows is an edited and updated version of the historical narrative I penned during 2016, to commemorate and celebrate the 40year anniversary of the partnership between the Department of Housing & Urban Development (‘HUD’) and the ‘mobile home’ and manufactured housing industry. It was published in the HUD Newsletter. The proverbial phrase,”When life gives you lemons, make lemonade”,
first appeared in a 1915 obituary from writer Elbert Hubbard, describing popular actor Marshall P. Wilder’s uncanny ability to turn life’s trials into triumphs. Now, more than a century later, this motivating phrase is oft cited as being the “silver lining mantra of the manufactured housing industry”! But we’re getting well ahead of ourselves. During the early 1970s, when annual national new home shipments eclipsed a half million units, “building mobiles” was a flamboyant,
94 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
get-rich-quick business – climaxing in 1973 with 579,960 new homes produced and shipped! Two things then occurred that halved mobile home shipments by year 1975; plummeting down to only 212,690 units. • The legislating of the National Manufactured Home Construction & Safety Standards, a.k.a. HUD Code, in 1974, with implementation in 1976 – accompanied by a federally-mandated change in trade terminology to manufactured housing. The HUD Code, »
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at the time, turned out to be a two-edged sword: seriously stifling new home production and shipments on one hand; but according to the late Otto Wantuck, housing financier, writing in the June 2000 Issue of Manufactured Home Merchandiser magazine, “…construction standards greatly increased the credibility of the industry with lenders, investors, and the general public.” • At the same time, according to Wantuck, “The marriage of service companies, financial institutions and credit (repossession loss) insurance companies did not incorporate basic checks and balances needed in the world of (housing) lending.” and… the crash came in 1974 as financial losses skyrocketed. Credit insurance companies pulled out of the business and annual sales of homes plummeted….” Well, it took two decades for HUD Code manufactured housing to market and sell its way back to anywhere near early 1970s shipment levels, i.e. 1994 = 303,932 and 1998 = 372,843 units! However, the euphoria of the moment was short-lived. For, once again, as Otto observes, “Lenders…
used poor credit judgment for several years. This (resulted) in various lender setbacks, including the loss of credibility in the secondary market and reduced loan volumes as credit quality tightened.” For sordid details and consequences of this scenario on homebuyers/site lessees, read “Upside Down in a Mobile Home Park” in SWAN SONG. And frankly, this financial debacle sparked the beginning of a two-decade long manufactured housing paradigm shift that continues to this day. It is also important to recall how, in 1985, to protect smaller, regional HUD-Code housing manufacturers from costly regulatory intrusion, the Manufactured Housing Association for Regulatory Reform was formed, and it too continues to this day. At the turn of the century, the Manufactured Housing Improvement Act of 2000 was legislated, ostensibly – but as time would prove, not really, to distance manufactured housing from the vehicle and trailer heritage, positioning it as housing. The good news in all this, was HUD continuing to enforce the performance-based national building code, with manufactured housing not only becoming more homelike
Photo Caption
96 | MAY-JUNE 2021 | STATE OF THE INDUSTRY EDITION
in appearance and functionality, but was increasingly appreciated for the quality and energy efficiency built into the final product; and best of all, continuing recognition of intrinsic affordability. Through the years, the HUD Code, whose regulatory restrictions were originally decried as severe impediments to manufactured housing growth became viewed as a unique marketing advantage. The HUD Code’s federal exemption from local building codes opened up more markets, nationwide, for new manufactured homes than would otherwise have been possible; over time, elevating the code to sweet lemonade status. The industrial and consumer paths to homeownership have not been smooth, straight or easy. Beyond the federal regulatory matters, and finagling of housing finance on two cited historic occasions, there’ve been battles over housing installation responsibility, dispute resolution, and more. But through all this, the manufactured housing industry and Department of Housing and Urban Development’s Office of Manufactured Housing Programs have found ways to work together for the good of the American homebuyer. MHV George Allen has owned and fee-managed land-lease communities since 1978. He’s a former MHI Industry Person of the Year and a member of the RV/MH Hall of Fame. He has been designated a Certified Property Manager-Emeritus and a Manufactured Housing Manager-Master. He’s also a senior consultant and staff writer with EducateMHC. Allen can be reached at (317) 346-7156 and gfa7156@aol.com.
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DRIVEN
PROVEN
Christopher Nortley President | CEO (586) 884-8416 chris@mhreinc.com
Amanda LaConte Senior Financial Analyst (407) 670-0552 amanda@mhreinc.com
MANUFACTURED HOUSING GROUP
RESULTS
Colleen Lannoo Melissa Wade Broker Associate | Senior Transaction Director of Data Research Manger (586) 580-7322 (586) 884-8415 colleen@mhreinc.com melissa@mhreinc.com
Tammy Fonk COO | Director of Sales (262) 498-3837 tammy@mhreinc.com
Detroit HQ Location 12900 Hall Road, Suite 190 Sterling Heights, MI 48313
Michel Mikkola Senior Advisor (407) 640-7046 michel@mhreinc.com
Tampa Location PO Box 4174 Tampa, FL 33677
Christine Ticconi Chief Financial Officer (586) 884-0671 christine@mhreinc.com
www.mhreinc.com
PANELS THAT DEFEAT THE WEED EATER FOR ALL CLIMATE NEEDS RUSTIQUE RIBB • Limited lifetime warranty to Weed Eater Damage • Engineered for Impact Durability and Wind Resistance • Patented Design - US10,378,202 • Available in Airflow and Solid • Recessed vents for a classic appearance
RAPID WALL • Limited lifetime warranty to Weed Eater Damage • Panel backed with 2 inch Thermal Star EPS below grade foam by ATLASEPS for 9R+ insulation factor • Engineer certified projected energy savings • Complies with Hud wind loading for Zones I, II, III • Over fifteen years of use in the Manufactured Home Market 1300 Rustique Square • O’Fallon, Missouri 63368 636-498-5525 • 636-447-0400 fax www.rustiquerapidwall.com • www.rustiqueribb.com