George Allen « George Allen / EducateMHC Blog

December 29, 2013

Meet Mharrio & Mhiki; 25 L-Os & No Defaults!

Filed under: Uncategorized — George Allen @ 5:47 am

George Allen writes about Key MHBusiness Issues, Matters, & Serious Concerns

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, is the real estate component of manufactured housing.’

Purpose of this blog. ‘To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!’

How to input. Critical responses & helpful ideas Welcome for future blog coverage here: gfa7156@aol.com & Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

An Important Year End Announcement!

When the January 2014 issue of the Allen Letter Professional Journal is mailed later this week and next, it will NOT contain the 25th Anniversary ALLEN REPORT, a.k.a. ‘Who’s Who Among Land-lease-lifestyle Community Portfolio Owners/operators Throughout North America!’, UNLESS recipients have recently (within the past 30 days) affiliated with the Community Owners (7 Part) Business Alliance, or COBA7, by adjusting their paid subscription to said newsletter, to include said ALLEN REPORT, plus a dozen Signature Series Resource Documents or SSRDs (e.g. National Lenders Registry, ‘Who Ya Gonna Call in 2014?’ directory of freelance consultants, & ten additional directories), to be distributed to newsletter subscribers during the next twelve months!

It is not too late for YOU to ensure soon receipt of the Biggest & Best ALLEN REPORT compiled during the past 25 years! Simply phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and, using a credit card – or corporate check if preferred, indicate your choice of

Option II @ $544.95. If you’re already an Allen Letter subscriber, we’ll adjust the subscription amount to reflect unused credit or lengthen your present subscription accordingly.

Option I? That’s simply a one year subscription to the Allen Letter professional journal, nothing less, nothing more. If already an Allen Letter subscriber, and you’re content with NOT receiving the ALLEN REPORT & 12 SSRDs, there’s nothing more for you to do! If NOT a newsletter subscriber, but would like to become one, then exercise this Option I.

Option III? $944.95. That’s the same as Option II, plus an annual subscription to the Allen CONFIDENTIAL! business newsletter (12 monthly issues) – the only intimate, confidential, ‘insider’ communiqué existent in the manufactured housing industry today! Read by CEOs & presidents!

Bottom line? This year’s 25th ALLEN REPORT is extra special! If YOU own and or operate one or more land-lease-lifestyle communities, you owe it to yourself to affiliate with COBA7, and receive this seminal document, along with the industry’s longest-running monthly newsletter, and 12 SSRDs designed to make your free enterprise adventure easier and more profitable!

Meet Mharrio & Mhiki

II.

25 Lease-Options in Four Years & No Defaults!
Here’s How to ‘Do-It-Yourself’!

III.

Why YOU Should Affiliate with COBA7

(Two Breaking News Stories to Read Now, Only if COBA7 Affiliates!)

***

Meet Mharrio & Mhiki

Major Characters in Future Parodies and Political Contretemps, Relating to Manufactured Housing & its Land-lease-lifestyle Community Realty Asset Class…

Never mistaken for twins, they hail from the same family – but rarely invite one another to participate in the other’s politico-social-association gatherings. That’s truly unfortunate, as their respective family loyalists would likely learn valuable business and political lessons from their not-so-distant relatives, given networking opportunities to mix and mingle on a regular basis. Makes one wonder, ‘Why?’ Mhiki & Mharrio don’t arrange for their respective ‘faithful’ to benefit from such social/business opportunities

In any event, Mhiki is the older and bigger of the two siblings. But Mharrio is longer-in-the-tooth politically, and widely viewed as being the more territorial and contentious of the pair. Those characterizations likely have to do with Mhiki’s loyalists being eclectic and heterogeneous, while Mharrio’s faithful are as homogeneous as can be, given their singular manufacturing focus. Those unique intra-family characterizations, as one might expect, lead to Mhiki being the political consensus-builder of the two, while Mharrio’s supporters are loyal to a fault, oft championing the minority view.

So, where do we find Mharrio and Mhiki as we prepare to begin a new (2014) year in manufactured housing, including post-production segments in general, and LLLCommunity contingent in particular?

Well, there’s no denying manufactured housing has come out of the recent political maneuvering in Washington, DC., with ‘less than the short end of the stick’ in hand, where much-needed alterations to Dodd-Frank legislation and CFPB regulations are concerned. For some strange reason, Mhiki appears to have adopted the stance, ‘less communication is more’, so even direct, dues-paying members, like the veteran industry observer penning these lines, have little direct knowledge of ‘What really went wrong?’ for most of us in the MHIndustry – OR, as some now opine, ‘What went right?’ for a politically blessed few? Note. If you read the previous lines in this paragraph, and don’t understand the thinly veiled message, you’ve not been paying attention when, where, and how you should!

Then there’s Mharrio. You’ve gotta feel sorry for the guy. I mean, how many times must one step forward with worthy and timely warnings of impending threats and danger to our industry – even from agents within (Now, that’s another story for another day!), only to have it ignored, even tromped upon by well-meaning but oft naïve sycophants? Thinking here about the Manufactured Housing Improvement Act of 2000, which after 13 years, is not yet fully implemented; about the recent botched attempt to seat a non-career leader on the Manufactured Housing Consensus Committee; even ‘right’ the non-independent operation of said MHCC. And then there’s the ol political football known as Duty to Serve; one day it’s OK, next day it’s off the table! Yet we continue to wonder why we make so little advocacy headway in our nation’s capitol…

So, what does 2014 look like for us? There’re two answers to that question. First; did you notice the previous paragraphs had ‘everything to do’ with manufactured housing and nothing – directly, to do with land-lease-lifestyle communities; or, for that matter, any other segment of the MHIndustry, except perhaps chattel finance? If you did notice, then that’s also ‘the answer’ to the question: Mharrio and Mhiki, each in their own right and unique manner, will, during 2014, continue to look after respective manufactured housing’s interests ‘inside the capitol beltway’, being Washington, DC, and Arlington, VA, and probably not much more.

But there’s a second question here; that having to do with ‘every other segment of the manufactured housing industry’, and the land-lease-lifestyle community asset class in particular! I’d be lying to you if I told you there wasn’t increasing discontent being expressed by ‘family members’, in casual conversation and via emails, regarding the markedly diminished communication (‘Ah, to have Bruce Savage back in place, keeping us informed!’) and political efficaciousness on one side of the house, not to mention failure after failure to head – off harmful legislation and effectively deal with it once arrived. Just look at the stalled house and senate bills, affecting manufactured housing finance regulations, this November and December! They were DOA…Dead on Arrival, despite protestations otherwise. But then, there’s another side to that story….

About the only bright spot on the 2014 horizon is the Community Owners (7 part) Business Alliance, or COBA7, emerging this month, and expected to hit its’ stride during January. NOT a formal non-profit or not-for-profit membership entity, but rather a business alliance of land-lease-lifestyle community owners/operators who insist on, and are now willing to pay for, proven products and services in seven key function areas:

• National Advocacy in a fashion that serves LLLCommunities large and small
• Ongoing statistical Research per operations benchmarks for LLLCommunities
• Distribution of Resources & directories critical to effective property management
• Ongoing (weekly & monthly) print & online Communication to owners/operators
• Superb peer networking via FOCUS Groups and Networking Roundtables
• Deal-making Opportunities for real estate brokerages and property owners
• Professional Property Management training & certification via MHM® program

If reading this, and interested in aligning your firm with CABO7, go back and reread the Announcement beginning this week’s blog posting. Know that CABO7 affiliation is available to any businessman or woman, or firm, in every segment of the HUD-Code manufactured housing industry! If the Official MHIndustry HOTLINE is ‘busy’ when you call, try (317) 346-7156. And frankly, CABO7 doesn’t care if your past loyalty has been with Mharrio or Mhiki; we simply want to serve LLLCommunity owners/operators in the seven function areas just identified!

II.

25 Lease-Options in Four Years & No Defaults!
Here’s How to ‘Do-It-Yourself’!

Once again I’ve reached out to Spencer Roane, MHM®Master, of Pentagon Properties, the manufactured housing industry and land-lease-lifestyle community asset class’ ‘duty expert’ on the effective use of lease-option to put would be homebuyers/site lessees into new manufactured homes in LLLCommunities.

Editor’s Note. In a day when manufactured housing national advocacy bodies have been unable to ameliorate constricting negative effects of onerous financial regulation of chattel capital, where manufactured housing and land-lease-lifestyle communities are concerned (In case you haven’t heard, neither house or senate bill went anywhere in Washington this month!), the lease-option becomes one more practical homeownership-facilitating tool in the property owner’s quiver of self-finance arrows. I know of no one better than Spencer Roane, MHM®Master, to ‘splain’ not only his time-proven technique in this avenue, but ‘How he’s been doing it, where new HUD-Code homes are concerned, the past four years with NO defaults!’

23 years ago, we began selling manufactured home (‘MHs’) via Lease-Option (‘L-O’) in the land-lease-lifestyle communities (‘LLLCs’) we own and manage. Our previous experience with rental MHs told us to avoid the oft self-defeating ‘churn & burn’ routine. It took almost 20 years, however, for us to learn how to effect L-Os while minimizing defaults. In no special order, here’re critical guidelines we use to achieve this end:

• Right home to sell. Today’s resale homes and repos are scarce, older, often in poor condition, and surprisingly expensive. So, new homes make better sales for us! In addition, these homes must be functional, lower cost, have ‘eye candy’, even a Wow! factor, be well-constructed, and with a good warranty. Community Series Homes, with their durability-enhancing features make near ideal L-O homes.

• Right price. Why try to make a killing on the sales price of a new home, when selling said home just $1-2K over cost, creates a ‘home run’ in terms of increasing property cash flow, adding value to the LLLC, cutting common area costs, improving overall curb appeal, and adding to a positive ‘community spirit’? All the while, we try to keep the L-O term to 12-13 years.

• Right community. This includes appearance, resident mix, staff personnel, desired amenities, even appropriate site rent. In the latter instance, it’s important to ensure rental homesite rates are in sync with rents at other multifamily rental properties in the same local housing market.

• Right marketing. Here we’re talking about attractive off and on-site signage, print and online advertising, an inviting sales or information center (not ‘office’), attractive property logo and color scheme, as well as appropriate point-of-purchase sales material, even effective prospect follow-up procedures. For assistance in these areas contact Chris Nicely (print & online advertising) via cnicely929@aol.com or (865) 385-9675, and Don Westphal (signage & curb appeal) via don@dcwestphal.com or (248) 651-5518.

• Right processing/underwriting of applications. (Read on…)

• Right follow-up after the ‘sale’ via Welcome Packages, warranty help, etc.

Now, not suggesting the initial four considerations listed above, are any less important, but experience proves the ‘processing/underwriting’ (step) is VERY important – particularly verification of application information and establishing and applying acceptable limits for front-end and back-end Debt-to-income (DTI) ratios. *1 And the follow-up (step) is vital as a sort of ‘icing on the transaction cake’, helping the new homeowner/site lessee make the adjustment to land-lease-lifestyle community living.

Since we lease homesites when we rent or lease MHs, we thoroughly review all the following when considering an L-O application:

• Verification of rental history (no domestic or police problems, past rental amounts and payment history)

• Verification of employment (sources of income, type work, time on the job, monthly income, likelihood of continued employment)

• Credit report (payment history with creditors, monthly obligations, previous addresses)

• Income tax returns (historical income, dependents)

• Checking and savings account statements (income, expenses, and savings over a three month period, funds available for option payment, insurance, moving costs)

• Budget – income and expenses, before and after entering into L-o contract.

• Criminal report (applicant can get copy from local police or sheriff’s office)

• Debt-to-Income Ratios capitalize income in these deals: Front-end ratio = Housing costs (monthly site rent + monthly L-O payment) divide by total gross monthly income. Target: below 30%
Back-end ratio = Total monthly debt (housing costs, car payments, furniture payment, loan payments, child support, etc.) divided by total gross monthly income. Target: below 40%.

A tool we’ve found particularly helpful is one which we refer to as our Pre-Qualification Worksheet (‘PQW’). Before asking the home sales prospect to complete an application, pay an application fee, or even look at homes, we ask them to provide the following information, which we enter into the PQW spreadsheet:

• How much are you paying in rent now?
• What will your previous landlords say when we contact them about your rental history?
• What will your criminal history show when we contact law enforcement authorities?
• What will your credit report show?
• How much do you have available for a down payment (option payment)
• What monthly debt obligations are you currently responsible for?
• What is your gross monthly income from various sources?

Knowing the monthly site rent at the LLLC, the home buying prospect is interested in, as well as their monthly gross income and current monthly debt obligations, the PQW computes the maximum monthly L-O payment the prospect could make and still satisfy the DTI ratios (our PQW uses a sliding scale, based on an applicant’s gross monthly income, for acceptable DTI ratios)

Alternatively, if we also know the monthly L-O payment on the home a prospect is interested in, the PQW computes the DTI ratios and ‘flags’ acceptable or unacceptable values. If the prospect’s DTI ratios are unacceptably high, our sales personnel can suggest the prospect consider a less expensive home or possibly pay off some recurring debt (e.g. credit cards) before buying their new home. If the prospect’s DTI ratios are exceptionally low, our sales personnel can also tell them they might qualify for a more spacious home.

If our PQW indicates a prospect would be approved, based on the information the prospect provides, we encourage him/her to complete our full application, and pay the application fee. As long as the information provided by the prospect is accurate, he/she will be approved. We ensure the prospect knows the application fee is non-refundable if our processing/underwriting reveals information provided for the PQW was inaccurate.

A copy of our PQW is posted on the Lease Option Documents page of our website: www.leaseoptionmhsales.com

End Note.

1. The initial five guidelines closely parallel the ‘5-RPs of Marketing’ popularized by George Allen, CPM®Emeritus & MHM®Master. For a FREE plastic wallet card containing these 5-RPs (Right Product, Right Place, Right Price, Right Promotion, Right People) – and details pertinent thereto, simply phone the Official MHindustry HOTLINE: (877) MFD-HSNG or 633-4764.

III.

Why YOU Should Affiliate with COBA7

Two Breaking News Stories to Read Now, Only if a COBA7 Affiliate!

RHP Properties, Inc., further expands its’ property portfolio with acquisition of 15 land-lease-lifestyle communities, containing 5,900 rental homesites, located in Colorado and Texas. For the rest of the story, read January 2014 edition of the Allen CONFIDENTIAL! business newsletter or February 2014 issue of the Allen Letter professional journal.

The 50th anniversary issue of Automated Builder magazine debuts online during January 2014. To contact Don Carlson, phone (805) 351-5931. To read his column ‘It’s Virtually Here!’, and review the ezine’s advertising rate card, read the January 2014 edition of the Allen CONFIDENTIAL! business newsletter or February 2014 issue of the Allen Letter professional journal.

These are two examples of why you, as a land-lease-lifestyle community owner/operator, or anyone serving the product/service needs of this realty asset class, need to affiliate with COBA7 now! This new and unique business relationship begins 1 January 2014, ushering in the NEW ERA for LLLCommunities, large and small, nationwide & in CN. Will YOU be aboard & participating? I surely hope so! George Allen, CPM® & MHM®

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George Allen, CPM®Emeritus, MHM®Master
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

Comments (0)

December 22, 2013

Advocacy Misfires; Marketing Paradigm Shifts & More…

Filed under: Uncategorized — George Allen @ 5:43 am

George Allen writes about Key MHBusiness Issues, Matters, & Serious Concerns

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, is the real estate component of manufactured housing.’

Purpose of this blog. ‘To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!’

How to respond? Critical responses & helpful ideas Welcome for future blog coverage: gfa7156@aol.com & Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

Again; a little help from my friends in the MHBusiness! We continue to reconstitute our email contact list, following hacking of our computers two weeks ago. SO, continue to send us names and email addresses of other ‘friends in the MHBusiness’ who’d likely want to be included in this special brand of communication available nowhere else in the HUD-Code manufactured housing industry & land-lease-lifestyle community asset class!

ADVOCACY MISFIRES BADLY!or ?

II.

MARKETING

III.

HOW ONE FIRM COMPUTES SITE RENT FOR ABANDONED HOMES OWNED BY AN INDEPENDENT CHATTEL LENDER

IV.

Be Aware & Beware!

ADVOCACY MISFIRES BADLY!or ?

“Bi-Partisan Effort Unveils Manufactured Housing Relief Legislation…
to Preserve Access to Affordable Manufactured Housing”

So reads the ‘Housing Alert’ headline on 12/17/13. And, an elected manufactured housing association leader identified in the story, called “…the introduction of S. 1828 a major step forward for the manufactured housing industry.” REALLY? ‘A Major Step Forward’? Perhaps, more accurately put, ‘a Too Late Step Nowhere!’? You decide….

The introduction of this U.S. Senate bill was duly ‘expected & predicted’ in a Blast Email Blog Alert (‘BEBA’) posted here Four Weeks Ago! And Now, with ‘no days left’ in the current session of Congress, does anyone expect action, let alone passage, of this companion bill to H.R. 1779? In a word, ‘NO’!. In another word, ‘WHY – the delay?’ Methinks the answer is twofold, in terms of immediacy and ‘further down the road’: 1) Simply CYA! or ‘political cover’ today; and, 2) ‘Something near nefarious (?) is afoot’, that to understand, you’ll have to read deeper into this blog posting, and more yet to come…

For now though, all that PAC (political action committee) money has been spent (wasted?), once again, on ‘fruitless & failed’ lobbying! When will the manufactured housing industry finally get out in front of business – killing legislation, and STOP playing catch – up, after regulatory bugaboos (e.g. S.A.F.E. Act, Dodd – Frank) have been turned loose on it?

January 2014 is nigh upon us! Are we now doomed as an industry? Maybe, and here’s why….

For more than two years, the manufactured industry has been told repeatedly, by it’s self – appointed champions of strategy, to focus ALL our attention & resources on amending onerous Dodd-Frank legislation – to the exclusion of virtually everything else (e.g. ’Duty to Serve’, etc.) – before this January 2014 deadline arrived! Well they & we failed to amend Dodd-Frank, and now we’re ‘left holding a bag full of other consumer financing matters’ that could & should have been tackled months, if not two years ago! Result? We (will) continue to ship new HUD-Code houses at the dismal rate of but 50,000 – 60,000 per year, with no regulatory relief, and no easily accessible chattel capital, in sight!

Face it friends. If we’re going to (maybe) survive, and even eventually thrive again – assuming we get an even playing field somewhere along the way for our homes and homebuyers – it’s going to be on our own merits! And one of those merits, like it or not, involves a paradigm shift – or two, in way(s) we do business with one another. And there’s one example of a needed shift (e.g. ‘MARKETING’), featured and parsed as next topic in this blog posting….

But before we turn there, here’s a hint about the aforementioned ‘Something near nefarious (?) is afoot’ comment, regarding the broader, interim future manufactured housing industry scene. Simply; it has to do with someone or some thing achieving controlling national market share(s) in areas of 1) home manufacturing; 2) home finance; and, 3) full service real estate brokerage franchising.

II.

MARKETING

Manufactured Housing’s Industry Person of the Year, Ken Rishel of Rishel Consulting, in the December 2013 issue of his online newsletter, Chattel Finance Newsletter opined, ‘…the manufactured housing industry, and especially (land-lease-lifestyle) communities, need access to marketing expertise.” Amen to that! GFA

To buttress his point, Rishel described “A Michigan land-lease-lifestyle community owner (who) bitterly complained about…a self-proclaimed ‘marketing expert’ (to whom) he shelled over considerable money…for help in turning around his infill problems. Six months later the community owner had zero results for the money he’d invested.” Well, ‘shame on him’ if he didn’t ask for and check the quality of past work referrals related to this individual. Did this ‘expert’ possess peer – reviewed professional credentials, like being a Certified Property Manager®, or possess a bona fide real estate salesperson or broker licensee? In related fashion, it’s one of the reasons the Community Owners (7 Part) Business Alliance (‘COBA7) annually updates the ‘WhoYa Gonna Call in 2014?’ list of 40+/- freelance manufactured housing and LLLCommunity consultants. While listing thereon does not constitute endorsement, the list is vetted before publication each year! To obtain a copy, or – as a consultant, request consideration to be added to said list, simply phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. No other organization or individual, to date, researches and publishes such a useful roster for the MHIndustry and LLLCommunity asset class.

December 15, 2013

Order ALLEN REPORT, Use Lease-Option!?

Filed under: Uncategorized — George Allen @ 5:37 am

George Allen Writes about Key MHBusiness Issues, Matters, & Serious Concerns

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, is the real estate component of manufactured housing.’

Purpose of this blog. ‘To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!’

Ways to respond: Critical responses & helpful Ideas Welcome for future blog coverage:
Gfa7156@aol.com; Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

Here’s something Special YOU can do for me after reading this week’s Blog Posting.

Reach out to friends in the MHBusiness & suggest they too start reading this weekly op/ed! All they have to do is contact me via one of two ‘Ways to respond’ above, & ask to receive our BEBA (Blast Email Blog Alert) most Sunday mornings. Thanks!

15+ Important Things You’ll Learn When Reading
the
25th Anniversary Edition of the ALLEN REPORT!

II.

What’s Good for the Goose is Good for the Gander!

III.

DID YOU KNOW?
(Don’t want to miss this enlightenment)

15+ Important Things You’ll Learn When Reading
the
25th Anniversary Edition of the ALLEN REPORT!

A.k.a.

‘Who’s Who Among Land-lease-lifestyle Community Owners/operators From Throughout North America!’

Not just TWO lists this year (i.e. 100 of 500+/- largest portfolio ‘players’, & 1994-2013 REIT portfolio size chart); now FIVE lists, including addition of 65+ mix of, ‘previously listed’ & ‘no shows’, plus 17 new listees & MORE!

1. Who is Green Hill Financial? You need to know, as the debut of this $ firm – in this industry observer’s opinion, ‘might’ mark the emergence of new trend!

2. How to facilitate your Direct Mail Campaign access to the exclusive, data base comprised of 500+/- LLLCommunity US & CN portfolio owners?

3. What is the average property portfolio size, by number of LLLCommunities, during 2013? And average size LLLCommunity within these portfolios?

4. What percentage of all 780,705 rental homesites catalogued in this year’s 25th Anniversary ALLEN REPORT are owned/operated by the Ten Largest LLLCommunity Portfolio Firms? Hint. Surprise = More than 50 percent!

5. Collectively, by what percentage, did the three LLLCommunity REITs (ELS, Inc., SUN Communities, Inc., & UMH Properties, Inc., Grow or Reduce their rental homesite inventory during 2013? And which, if any, ‘grew’ the most?

6. Examining a sampling of small to mid – sized property portfolios, what was the average’ ratio of all-age to age-restricted LLLCommunities’ during 2013?

7. What high percentage of this year’s ALLEN REPORT respondents from 32 states and once Canadian province, hail from just nine states & one province?

8. What is the ‘average national physical occupancy’ among ALLEN REPORT LLLCommunity owners/operators respondents during 2013?

9. What is the ‘average value of a contract sale home’ among this year’s 7,820 homes reported by 29 LLLCommunity portfolio owners/operators?

10. What is the ‘average national Operating Expense Ratio’, or OER percentage among ALLEN REPORT’s LLLCommunity owners/operators for year 2013?

11. How many LLLCommunity owners/operators acquired 1,000+ rental homesites apiece, in 2013, and named as part of the ‘Pride of Young Lions’?

12. Of the ‘Daring Dozen LLLCommunity ‘portfolio-building entrepreneurs’ who ventured forth in 2005, ‘How many & Who’ remain active in the asset class?

13. And WHO is Manufactured Housing Industry Person of the Year for 2014?

14. And WHO is the worthy professional property manager of LLLCommunities, now honored with the designation: Manufactured Housing Manager–Master!?

As announced in last week’s blog, as well as in the December issue of the Allen Letter professional journal, the 25th Anniversary ALLEN REPORT, and future editions, as well as a dozen Signature Series Resource Documents, or SSRDs, will be available only as an integral part of two packages (a.k.a. Options II & III), available from PMN Publishing. In summary, the contents of each Options are:

OPTION I. Allen Letter professional journal alone – No ALLEN REPORT, No Signature Series Resource Documents (& directories) described earlier. Cost. $134.95

OPTION II. Allen Letter professional journal, 25th anniversary ALLEN REPORT, & 12 monthly Signature Series Resource Documents (& directories). Cost $554.95 This monthly newsletter, 25th AR, & 12 SSRDs = ‘Our LLLCommunity knowledge base!’

OPTION III. Allen Letter professional journal, 25th anniversary ALLEN REPORT, & 12 monthly Signature Series Resource Documents (& directories), as well as the Allen CONFIDENTIAL! ‘insider’ business newsletter for Sr. Execs. Cost $994.95 These 4 Resources have served MHIndustry professionals for more than 2 decades!

If you’re already an Allen Letter professional journal subscriber, & are satisfied with that monthly source of key & timely LLLCommunity/MHIndustry information, there’s nothing to do, but ‘use that information’, & wait for your renewal notice. But there’ll be no ALLEN REPORT enclosed in the January 2014 Allen Letter. However, if NOT presently a subscriber, but would like to become one, simply phone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and sign-up for OPTION I…

AND, whether you’re a present Allen Letter professional journal subscriber or not, but would like to receive a copy of the Biggest & Best 25th anniversary ALLEN REPORT, along with the dozen Signature Series Resource Documents (& directories) during the next 12 months, decide between OPTION II & III, then phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 to subscribe!

And remember, the sole difference between OPTIONs II & III, is the latter option includes the coveted and rare opportunity, as a Senior Executive in either the MHIndustry or LLLCommunity asset class, to be privy to timely, inside information generally not printed elsewhere by anyone else; and if so, generally ‘months after you’ve read it’ in the Allen CONFIDENTIAL! business newsletter. The TAC! ‘newsletter’ is comprised of three to five, single-spaced, typed pages, and is accompanied by one to two or more dozen ‘enclosures’ documenting everything disclosed within that issue. For example. Who’s new CEO @ Green Hill Financial?

Questions, & to order your OPTION choice, phone Official MHIndustry HOTLINE!
To ensure receipt of your copy of the 25th Anniversary ALLEN REPORT – Bigger & Better than any of the previous 24 annual editions, effect your OPTION choice before the end of December 2013!

II.

‘What’s Good for the Goose is Good for the Gander!’

An old saying or idiom, with several shades of meaning – believe it or not, that apply to the lease-option home finance alternative, regarding manufactured home transactions in land-lease-lifestyle communities!

Gander = ‘a male goose’
&
Gander = ‘a careful look’

The shades of meaning: 1) ‘What’s good for one sex is good for the other’; 2) ‘Hey, maybe this lease-option alternative deserves a second careful look’; and, 3) ‘If lease-option is good for a few large portfolio owners/operators, why wouldn’t it be good for most remaining properties in the realty asset class’?

So, it was with those thoughts in mind, I reached out to Spencer Roane, MHM®Master, and owner/operator of Pentagon Properties, to share his latest and best ‘take’ on…

‘Lease-Option as an Alternative for In-LLLCommunity Seller-Financing’

With all the talk these days, about new financing regulations taking effect next month (January 2014) – and the tangible havoc they’re expected to wreak on the manufactured housing scene, perhaps it’s high time for us to re-consider Lease-Option (‘L-O’), as a practical means of supporting home sales within your land-lease-lifestyle community or communities. If you agree, here’re a few things to think about now and during the few weeks ahead to the end of the year….

The Bad News is the S.A.F.E. Act, which requires licensing for mortgage origination and servicing, is a Federal law interpreted and enforced differently among states. So, what’s acceptable in one state may not be acceptable in another. Furthermore, some regulators have taken positions against L-O, without taking time to learn and recognize how it differs from ‘lease-purchase’, ‘rent-to-own’, etc., which many agree, are indeed credit transactions that could result in the origination of mortgages requiring S.A.F.E. act licenses.

The Good News is what deserves our attention here.

• Almost five years have passed since the S.A.F.E. Act was enacted. Chicken Little arguments against L-O (e.g. Misleadingly called ‘disguised credit transactions’, or walks-like-a-duck, & quacks-like-a-duck, etc.) have been appropriately dismissed from most serious finance conversations. Anyone who thinks law is that simple should wonder why it takes more than 70,000 pages to document the U.S. tax code.

• Some very bright attorneys agree mortgages are not created or originated by L-O transactions, and therefore, S.A.F.E. Act licenses are not required with them. If you missed the SECO Symposium in Georgia, earlier this Fall, you missed a great presentation on this very subject. It’s posted for your edification at the website www.SECO13.org

• Many large land-lease-lifestyle community owners/operators have used L-O contracts to sell homes for years. Unfortunately, they dominate national advocacy organizations, and seemingly discourage the host body from disseminating information about L-O to other, albeit smaller, LLLCommunity owners/operators around the U.S.

If you’re seriously interested in L-O transactions (e.g. Arguments as to why S.A.F.E. Act licenses are not required, how to structure transactions, and even a copy of one LLLCommunity owner/s L-O contract, etc.) review this free information at www.LeaseOptionMHSales.com, particularly the following links: Also check out these resources:

‘Lease Option Sales Transactions Gaining in Popularity’, published in the April 2011 issue of the Allen Letter professional journal. Revised & reprinted @ 8/2012

‘Everything you’ve ever wanted to know about lease purchases, and then some’, and ‘Consumer Leasing Act: Regulation M’; both by D.J. Pendleton, executive director, Texas Manufactured Housing Association, describing S.A.F.E. Act and Dodd-Frank Acts, MH seller financing, and Regulation M – all in ‘TMHA Today’, Winter of 2012.

‘Characteristics of a L-O Transaction that Differentiates it from an Installment Sale’, July 2013.

All the preceding information was provided, at this blogger’s request by:

Spencer Roane, MHM-Master, president of Pentagon Properties, Inc., Atlanta, GA. Mr. Roane owns and manages four land-lease-lifestyle communities in Georgia and Texas. His firm has sold more than 250 new and resale manufactured homes in his communities during the past 20 years, via Lease-Option contracts. During the past three plus years, his firm has had NO defaults on new home Lease-Option contracts. He is a member of the Georgia Manufactured Housing Association, where he served as an officer and member of the board of directors. He is a former member of the Manufactured Housing Institute (‘MHI’) where he served on the National Communities Council (‘NCC’) board of directors, and the Disaster Housing Task Force. He is one of the organizers of the highly successful SECO Symposium series for LLLCommunity owners/operators throughout the Southeast U.S. He holds a B.S. degree in Electrical Engineering, an M.S. degree in Industrial Management, and both the Mortgage Loan Originator and Mortgage Broker S.A.F.E. licenses. Contact him at spencer@roane.com or (678) 428-0212. Pentagon Properties, Inc. website. LinkedIn profile.

III.

DID YOU KNOW?
(Prepare to be twice enlightened here!)

Being identified as a key leader, MHIndustry Person of the Year, or a Manufactured Housing Manager® – Master, in any book printed and distributed by PMN Publishing (There’ve been 11 to date), pretty much ensures your name and unique business achievement(s), an enduring place in manufactured housing and land-lease-lifestyle community history! For that matter, being identified as a major loan originator or freelance consultant, in one or another of PMN Publishing’s dozen Signature Series Resource Documents (& directories), even as a ‘presenter’ at the annual Networking Roundtable, also ensures your personal & corporate legacy! How so?

To date, there’ve been more than 11 MHIndustry Persons of the Year and 16 Manufactured Housing Manager®-Masters designees honored, along with the 19 land-lease-lifestyle community owners/operators who met on 31 August 1993, the latter taking the first pre-REIT steps leading to formation of a national advocacy body. And there’ve been other ‘special mentions’ over the years, as well, e.g. Sam Zell of ELS, Inc., naming of the annual Pride of Young Lions (Year’s most successful portfolio consolidators) and the Daring Dozen (2005 era portfolio – building entrepreneurs), within the annual ALLEN REPORT, a.k.a. ‘Who’s Who Among LLLCommunity Owners/operators Throughout North America!’ Many of these ALLEN REPORTs have been routinely republished as appendices in most of PMN Publishing’s textbooks.

Again, the same can be said of one’s appearance and reputation in the annual National Registry of Realty & Chattel Loan Originators, and ‘Who Ya Gonna Call in 2014?’ list of freelance consultants – just two of PMN’s dozen SSRDs! These unique resource documents and directories, designed and updated annually for the use of land-lease-lifestyle community owners/operators nationwide, and in Canada, are also oft included as appendices. For example, the firm’s most recent release, Bruce Savage’s The First 20 Years! (Chronicling the first two decades of LLLCommunity national advocacy) contained not only the names and biographies of the aforementioned 19 ‘pioneers’, but all the SSRDs updated during 2013! To order a copy of the book, for $19,95 postpaid, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

Now enter national libraries of business – related books. At least three have expressed interest in acquiring the extensive manufactured housing and land-lease-lifestyle community corporate library of GFA Management, Inc., dba PMN Publishing. The RV/MH Heritage Foundation’s library in Elkhart, IN., Library of Congress, and the National Building Institute library in Washington, DC. Why would these national libraries want to acquire this firm’s ‘stacks’? Because this particular corporate collection contains virtually every published and bound (case, perfect & spiral) title published from the early 1970s to the present day, numbering more than 100 volumes – including collections of short stories, stand alone mysteries, biographies and autobiographies, HOW TO works, & much much more.

So, if your name and achievements are mentioned and or highlighted in any of PMN Publishing’s past and ‘in print’ texts, SSRDs & directories – even those yet to come, e.g. a new ‘Lessons Learned in LLLCommunity Management’ tome planned for 2014. (Interested? Let us know of your interest via the above – referenced Official MHIndustry HOTLINE!), know Your Legacy will ‘live on’ in one or more of the national library repositories of business history! The question that begs answering though, is this: ‘What other business or organization in the entire manufactured housing industry looks out for your present, future, and personal/corporate legacy in such tangible fashion?’ None.

With that said, and if an Allen Letter professional journal subscriber, you likely have just learned who’s being honored as the 2013/2014 MHIndustry Person of the Year, and who’s just been designated a Manufactured Housing Manager®-Master. If not, you’ll soon read their names and stellar achievements in the 25th Anniversary ALLEN REPORT, scheduled for distribution during early January 2014. And trust me, this is one ALLEN REPORT you do not want to miss! As stated earlier, this is the Biggest & Best ALLEN REPORT published in 25 years! Even contains a copy of the 1987 pre-ALLEN REPORT list of ‘25 largest mobile home park owners’ known at the time. Today there’re 500+/-!

Frankly, I am ‘pumped’ for the year 2014! Why? The Community Owners (7 Part) Business Alliance, and ‘Opportunity for you to align your business interests with COBA7’, was introduced but a couple weeks ago, and already verbal, written, and financial support has waxed heavy and sustained! As expected, the aforementioned OPTION II is drawing the most response from land-lease-lifestyle community owners/operators nationwide, but there’s also been a surprisingly good number of OPTION IIIs too. SO, if you want to be among the first to receive the 25th Anniversary Edition of the ALLEN REPORT, soon after 1 January 2014, effect your subscription soon, via Official MHIndustry HOTLINE!.

One final hint. I’m contemplating hosting a COBA7 breakfast one morning during the Louisville MHShow, probably 22 January 2014. If you are interested in attending, and want to be sure of an ‘invite’, let me know via one of the means mentioned at the beginning of this blog posting. Threefold purpose of the breakfast meeting? 1) Explain what the Community Owners (7 Part) Business Alliance is all about and encourage Your Participation; 2) solicit Your Input as we plan a national FOCUS Group meeting in early April 2014; and finally, 3) Your Opportunity to express interest in penning fresh material for possible inclusion in the ‘Lessons Learned in LLLCommunity Management’ book planned for distribution later during 2014, likely at the 23rd annual International Networking Roundtable. I’ve already polled the four dozen LLLCommunity owners/operators who’ve helped launch COBA7, and the majority of them plan to be present at the breakfast meeting, probably from 8 – 10AM. How ‘bout you?

COBA7. National business alliance of LLLCommunity owners/operators, large & small, featuring seven functions: National Advocacy, Statistical Research, SSRD (& directories) Distribution, Peer Networking, Deal – making Opportunities, & Profession Property Management Training & Certification.

***

George Allen, CPM®Emeritus, MHM®Master
Box # 47024, Indianapolis, IN. 46247 (317) 346-7156

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December 8, 2013

NEW ERA = finally COBA7 & now, ‘Lifestyle’

Filed under: Uncategorized — George Allen @ 5:19 am

George Allen Writes About Key MHBusiness Matters, Concerns,& Much More…

Perspective. ‘Land-lease-lifestyle communities, a.k.a manufactured home communities & earlier, ‘mobile home parks’, is the real estate component of manufactured housing.’

Purpose of this blog. ‘To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!’

Ways to respond: Critical responses & helpful ideas Welcome for future blog coverage; gfa7156@aol.com; Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

‘COBA7’

II.

Giving ‘Lifestyle’ Legs…

III.

The Elephant in the Room

_____________________________________________________________

‘COBA7’

‘Community Owners (7 Part) Business Alliance’, already the buzz among land-lease-lifestyle community owners/operators throughout the US & CN’

Here’s the first of several responses to last week’s blog introduction to the ‘Community Owners (7 Part) Business Alliance’, and how ‘COBA7’will usher in a NEW ERA for ‘all of us’ during 2014:

“Well thought out, George, but there is an 8th part or purpose of the Allen activities. The opportunities you provide for all (manufactured housing) industry folk, to opine about their business concerns, beliefs and practices, is also Invaluable; and I feel should be highlighted! Large or small, you hear them all….” JR That’s certainly the case; you folk do write and communicate a lot with me, as you’ll soon read in Parts II & III of this blog.

Following is a Summary of Seven Functions targeted by the COBA7. And please remember; this is NOT a formal membership $ driven ‘for profit’ or ‘not for profit’ trade group; rather, it’s ‘an informal alliance of businessmen and women with land-lease-lifestyle community ownership/operations in common’. The three subscription Options, described a little later in this blog, is how the research, printing, and distribution (postage) costs will be covered going forward. So, please decide SOON, at what level you want to align your advocacy, research, resources, communication, networking, deal-making, and property management training/certification needs with COBA7. Specifically,

• National Advocacy. While the mission of one national council, there are issues and opportunities presently being ignored, that need to be addressed during 2014

• Statistical Research. The 25th anniversary ALLEN REPORT, a.k.a. ‘Who’s Who Among Land-lease-lifestyle Community Owners/operators Throughout North America!’ is Bigger (167+ owners/operators identified this year; up 52% from 110 ‘players’ listed last year!) & Better (More benchmark statistics and ‘good to know’ information than ever before…)

• Resources Distribution. 12 Signature Series Resource Documents or SSRDs, include: ‘Official State of the MHIndustry & LLLCommunities!, National $ Registry of RE & Chattel Lenders, ‘Who Ya Gonna Call’ list of freelance consultants, Official directory of print & online MHPublications; Official MHLexicon; and, six additional information – packed titles & directories!

• Print & Online Communication via weekly blog posting, the Allen Letter professional journal, and/or the Allen CONFIDENTIAL! business newsletter.

• Peer Networking via annual Networking Roundtable & periodic FOCUS Groups for LLLCommunity owners/operators desiring to caucus confidentially.

• Deal – making via opportunities planned & hosted with & by national real estate brokerages specializing in the Marketing of LLLCommunties in U.S. & CN

• Professional Property Management Training & Certification via the popular Manufactured Housing Manager® or MHM® one day class for owners/operators

You know, the blog correspondent quoted at the beginning of Part I to this week’s blog posting is Too Right. Sad to say, but there are NO longer, any other present day outlets or voices available to MHIndustry & LLLCommunity businessmen and women, other than three print and a couple online ezines and blogs. Here’re a couple sobering, troubling questions, along with one very dark thought: 1) When was the last time you read opinions and observations by our peers in print or online, except for the casual interview here and there, and the guest features you read in the Allen Letter professional journal? Now consider; 2) How would we fare, information-sharing and communication-wise, throughout our realty asset class, if we lost one or all these present day media means? Consequence. We’d likely have little to NO trade press left, and revert to the Dark Ages of No Communication suffered more than 25 years ago – except for what was written about home manufacturers!

To that end, decide before the end of December 2013, which of three Options describe your subscription affiliation with the Community Owners (7 Part) Business Alliance, or COBA7, during 2014:

Option I. Allen Letter professional journal alone – No SSRDs (e.g. And no ALLEN
REPORT) enclosed with 12 monthly issues of the newsletter @ $134.95

Option II. Allen Letter professional journal, 25th anniversary ALLEN REPORT, &
12 monthly Signature Series Resource Documents, @ $544.95/year

Option III. Allen Letter professional journal, 25th anniversary ALLEN REPORT, &
12 monthly Signature Series Resource Documents, & the Allen
CONFIDENTIAL! business newsletter, @ $944.95/year.

For those with existing subscriptions to either or both monthly print newsletters, an adjustment will be made to the amount you pay to begin the new year (2014). And remember; the 25th anniversary Biggest & Best ALLEN REPORT ever, will NOT be enclosed as a lagniappe or ‘freebie’ in the January 2014 Allen Letter professional journal!

To order Option I, II, or III subscription, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. If already an Allen Letter professional journal subscriber, & NOT interested in receiving the 25th annual ALLEN REPORT & 12 SSRDs, simply await a renewal form on or near your subscription date.

Bottom Line, One Last Time. Your financial support of the ‘Community Owner (7 Part) Business Alliance’ ensures LLLCommunity owners/operators, large and small, nationwide, will benefit from the Seven Functions described above, for years, even decades, to come! This is your opportunity to ‘get on board’ during December 2013. Watch for an announcement of a meeting of COBA7 affiliates during Louisville MHShow, likely on 22 January at a hotel near the KY State Fair Grounds….
II.

Giving ‘Lifestyle’ Legs…

The ‘Lifestyle’ adjective is catching–on far faster than we expected it would!

Here’s how another blog flogger (reader) suggests we help the manufactured housing industry & land-lease-lifestyle community asset class to embrace the ‘Lifestyle’ adjective among all segments or components of our unique, double – dual business type.*1

1. Start locally. Talk it up, and encourage exemplary businesses, new and old, to introduce Lifestyle into their entity name, mission statement, advertising, etc.. Even involve one’s state manufactured housing association in this new positioning of our housing type and community lifestyle.

2. Zero – in on HUD-Code manufacturers & land-lease-lifestyle community owners/operators actively using Community Series Homes, or CSH Models, to fill some of those 250,000 vacant rental homesites nationwide! In a word; if we’re ‘taking the high road’ with new CSH Model homes, why not include Lifestyle in all marketing efforts as well? Same can be said of using the cutting edge Modular Lifestyle homes.

3. Insist all local housing market rent surveys of LLLCommunities, by JLT & Associates and others, to include ‘all such properties’, NOT just the cherry – picked few of lively interest to property portfolio consolidators. Then identify the ‘best’ properties within said surveys, and highlight them as being exemplary ‘Lifestyle’ communities in that local housing market(s).

As you likely recall from last week’s blog posting, the world’s largest owner/operator of land-lease-lifestyle communities (i.e. Equity Lifestyle Properties, or ELS, Inc., for short), and Canada’s largest owner/operator of LLLCommunities, Parkbridge Lifestyle Communities, Inc., have already incorporated the adjective Lifestyle into their entity names! And Modular Lifestyles, a California converter of ‘trailer parks’ into land-lease-lifestyle communities, is setting a positive example among property owners/operators on the West coast. Let me know, via the contact alternatives listed at the beginning of this blog posting, when you’ve introduced the adjective Lifestyle into your corporate name!

End Note. 1. Double-dual business type? ‘HUD-Code home manufacturing & distribution; LLLCommunity development & investment/management’.

***

III.

The Elephant in the Room

And this, from a third blog flogger (reader), & so worthy of your attention!

“George. Kudos to you for identifying ‘the elephant in the room’, affecting the present and future of our property type (land-lease-lifestyle communities), especially where major (portfolio) players are concerned!”

“The titanic lack of professional property management of these multi – million dollar real estate investment assets is perplexing. I know from where it (i.e. nominal worth of on-site managers) rises – the bean counters assumption ‘real estate is the value of the asset’. This view pales however, when site and home vacancy rears its’ head! My conclusion is, many of the mature and successful industry professionals we’ve known over the years, have risen to senior management positions, and now struggle to keep their fresh crop of ‘apartment leasing consultants’ afloat in their sea of home sales and site leasing ignorance.”

“Just make a few (telephone) calls, and ask the person answering (leasing or sales consultant) a few questions, if you want to experience the ‘dumbing down’ of today’s on – site staff. These are often (former) apartment leasing staffers who’ve discovered, working as LLLCommunity managers brings more job satisfaction than painting walls, cleaning carpets, and servicing appliances during make – ready. But they’ve NOT learned – or been taught. probably due to training budget constraints, the basics and finer points of community management, home sales, and site leasing.”

“I frankly, but selfishly, appreciate this phenomenon (i.e. Corporate training, supervision, & Mystery Shopping shortfalls), because it makes it SOOOO easy to compete against them! How does one beat their really nice curb appeal and high rents? By effectively managing, selling, leasing on – site! And ask their residents if they would buy there again, and put up with the ‘artificially inflated market rents’ these firms manufacture. Not! So, I thank God for the REITs!” (Edited. GFA)

WOW! As we asked earlier in this blog posting, ‘Where else can businessmen and women, from the grassroots of our industry/asset class, and working on the front lines of property management, home sales, and rental homesite leasing, go to publicly share their observations, opinions, ideas, even criticisms of the status quo, and how we conduct our various business interests?; Answer: ‘Nowhere else!’ Just here – and here’s how….

The following terse line is also from a ‘last week’ blog flogger, one with 30+ years in the manufactured housing industry – and it’s not me!

“Good plan for a new organization (‘NO; again, ‘COBA7’ is a ‘business alliance’, NOT a formal business or association entity funded by membership dues! GFA). Often wondered, over the years, why communities and retailers have stuck it out with the (national advocacy body/ies). Let’s get-r-dun!” NB

Think that an outlandish comment? I don’t, and here’s why. Let’s call it ‘affluence gerrymandering’ – the de facto control of national trade association agenda (voter) power by 1) always holding national meetings in expensive venues, affordable only to the most affluent of businesses and state trade associations – hence discouraging member participation; and where, 2) voting is restricted to only those relatively few members in attendance at said national meetings! *1 This is not a new concept, not at all. It’s been the self-serving, power-garnering pattern, within certain manufactured housing industry advocacy circles, for more than three decades. In this industry observer’s opinion, it’s high time for wholesale change, of one sort or another…!

What change(s)? There’re really only two choices, maybe three. To 1) work from within, as direct, dues – paying members, collectively agreeing to propose and effect changes – in selection of meeting venues, and changing organization’s bylaws (e.g. allowing proxy voting by absentee members). And barring success there, 2) launch a new trade entity designed, in part, to correct self – serving matters like ‘affluence gerrymandering’ and rejection of proxy voting by absentee members, OR, 3) put up with ‘affluence gerrymandering’ and rejection of proxy voting for another three decades! Whew! Let’s hope neither of the latter two alternatives become reality.

End Note. 1. ‘gerrymandering’ = “…change the boundaries of election districts to give one political party an unfair advantage.” In the instance of ‘affluence gerrymandering’? Effect artificial boundaries, i.e. 1) one’s ability to participate financially, & 2) restrict voting privilege to those direct, dues – paying members in attendance at meetings, ‘to give one political party (e.g. affluent businesses) an unfair advantage.’

***

IV.

Hey, keep those emails, voicemail messages, penned notes, even telephone calls, coming my way! It ‘more than appears’ this weekly blog posting has struck a strong responsive chord among the 1,000+/- BEBA (Blast Email Blog Alert) recipients most Sunday mornings. At present we’re averaging more than a dozen written inquiries, insightful opinions, and helpful suggestions per week. And that’s fine. I can easily handle that volume. Don’t know ‘bout you, but I’m convinced the trade politic junkies, a.k.a. ‘wonks’ are so entrenched in one national advocacy body, they must continually ‘read about themselves’, and their ineffectiveness as leaders, lobbyists (Where’s that Senate bill we’ve been awaiting since before Thanksgiving?) and communicators, until they collectively adopt a New Years Resolution to better represent our entire industry!

George Allen, CPM®Emeritus, MHM®Master c/o Box # 47024, Indpls, IN. 46247

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December 1, 2013

MHInitiative@2014

Filed under: Uncategorized — George Allen @ 5:53 am

George Allen Writes About Key MHBusiness Interests & Concerns – & More…

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, are the real estate component of manufacture housing.’

Purpose of this blog. To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!

Ways to respond: Critical responses & helpful ideas Welcome for future blog coverage; gfa7156@aol.com; Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

***

MHInitiative®2014*1

As I started to pen this week’s blog posting, and given the nature of narratives I was about to share, I recalled this earthy riposte:

“Hey, you do know the difference between a fairy tale and a sea story, don’t you?”

Well, a fairy tale begins…’Once upon a time….’, while a sea story starts…’This ain’t no sh–!”

With that rhetorical juxtaposition in mind, YOU DECIDE THIS TIME NEXT YEAR, whether what transpired during year 2014, was indeed a fairy tale come true – OR one gone seriously awry; OR, is it a sea story with no one left around to tell or who cares?

Manufactured Housing’s ‘Perfect Storm’ in 2014?

The confluence of several interrelated factors & happenstances suggest it so!

Let’s begin with MHI’s Conference Call with state manufactured housing association executives on 21 November, AND the ‘too little too late’ Senate Bill mirroring House Bill # 1779, a.k.a. ‘Preserving Access to Manufactured Housing Act of 2013’. (On ‘Thanksgiving Day’ we were still waiting Senator J. Donnelly (D-IN) to introduce the latter bill – six months late, and a scant month before the end of this year’s legislative session!) Go figure.

Taken together; given the gist of said conference call, teaching ‘How to Live with the Truth in Lending Act’, rather than fighting it or welcoming needed/expected changes; and, effecting this last gasp, as penned earlier, ‘too little too late’ Senate Bill aping the stalled House Bill, suggests our industry’s efforts to unravel Dodd-Frank legislation, have been akin to stepping on Super Man’s cape, pissing up a rope or into the wind, even like repeatedly transporting, setting up, and dissembling a HUD-Code multisection manufactured home! It simply isn’t gonna – or in the latter instance, happen! But is THAT ‘the Real Story’ around and behind the failure of this round of legislative change effort? Methinks Not. But let’s wait and see what the unintended (Really?) consequences turn out to be, during 2014, (A hint) ‘regarding respective corporate National Market Share percentages of 1) HUD-Code home manufacturing, and 2) chattel capital sourcing.’

Here’s a summary look at major manufactured housing industry components or segments, and what they should consider doing in 2014, to weather the Perfect Storm:

HUD-Code home manufacturers. Learn to play better with the land-lease-lifestyle community folk! Whether you agree or not with last week’s blog headline: Land-lease-lifestyle Communities = Future of the Manufactured Housing Industry!, know until easier – to – obtain chattel financing, of new and resale manufactured homes sited in LLLCommunities ‘returns’ in volume to this industry, this unique, income – producing property type, is the only game in town, with an estimated 250,000 vacant rental homesites to be filled nationwide; that is, unless one wants to hang his/her future on ‘fracking’. So, if you’re not already aggressively marketing Community Series Homes, a.k.a. CSH Models to LLLCommunity owners/operators, big and small, learn how to do so during 2014! Two hints: First; pressure national advocacy bodies to plan and host a National Strategic Planning Meeting focused on how to effectively market CSH Model homes to the 42,500 LLLCommunities NOT in anyone’s property portfolio! And, if not already familiar with the ‘5 – RPs of Marketing’ and how they apply to you and LLLCommunities, order a FREE plastic wallet card containing what you need to know about Right Product, Right Place, right Price, Right Promotion, Right People. *2

Land-lease-lifestyle Community Owners/operators. Property disposition and consolidation among portfolio ‘players’, in the U.S. & Canada, continues unabated. Read the 25th anniversary ALLEN REPORT (A.k.a. ‘Who’s Who Among Land-lease-lifestyle Community Owners/operators Throughout North America!’) for details – and much more.*2 Number One concern among owners/operators continues to be filling vacant rental homesites with new homes and qualified homeowners/site lessees. This only happens ‘today’ when has sufficient and reliable sources of chattel capital to engage in one form or another of self – finance; more about that later. In this MHIndustry veteran observer’s opinion, the second most obvious shortcoming, throughout the realty asset class, is the absence of professional property management, at all levels. For the most part, we continue to run our valuable income – producing properties ‘by the seat of our pants’. If not already familiar with the aforementioned ‘5-RPs of Marketing plastic wallet card – for LLLCommunities, order one today. Also ask for the ‘Ah Ha! & Uh Oh! Worksheet. And if you’re really bold and conscientious, you’ll sign all your property managers up for training and certification as Manufactured Housing Managers® or MHMs®! *3

Manufactured housing finance. This is one area where ‘angels surely fear to tred’. As an industry, we have a bad, repetitive history of abusing our access to personal property (chattel) capital, seeing dozens of independent, third party ‘lenders’ of this type financing ‘come and go’, over the years. Memories of our most recent debacle, looking back to 1998 – 2008, a period sometimes labeled our Enronesque period, remains painful and consequential, i.e. Five years of record low ‘new home shipments’ @ 50,000+/-/year, and still no easy access to any volume of reasonable chattel financing for new and resale manufactured homes on – site in land-lease-lifestyle communities! Today? Appears we fight (or comply) with state and federal financial regulations on every front. Oh sure, chattel capital is available from the (now) Big Five + One independent lenders serving the manufactured housing industry, but only to prospective homebuyers/site lessees with ‘higher than average’ credit scores.*4 During the past five or more years, some new, and some old, terms like self – finance, ‘captive finance’, and lease – option have come to the fore, as more and more land-lease-lifestyle community owners/operators aggressively market, sell and self – finance new and resale homes on – site in their properties. How pervasive have these practices become? The annual ALLEN REPORT, during the past several years has estimated/documented more than $5 billion dollars of ‘contract sale’ paper on – site; this up from a few million dollars at the turn of the Century. And, during 2013, one of the nation’s largest LLLCommunity owners/operators, Zeman MHC, launched it’s own ‘bank’ (Green Hill Financial), to serve the chattel finance needs of other property portfolio owners/operators, first in a few states, then more….

End Notes.

1. MHInitiative®. The latter day or successor term for the National State of the Asset Class caucuses held on 27 February 2008 & 2009 respectively. Every year since then, we’ve ended the year, at PMN Publishing, with an update regarding the landmark matters decided upon at those two seminal meetings. Here you have this year’s summary and look ahead into year 2014. To learn what happened at the two aforementioned NSAC caucuses, read Landlease Communities, Manufactured Home Communities, Mobile Home Parks, Trailer Courts & Camps, & Affordable Housing, PMN Publishing, 2011. To order, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

2. To order the 25th annual ALLEN REPORT and or FREE ‘5 – RPs of Marketing plastic wallet cards (one for HUD- Code home manufacturers & one for LLLCommunity owners/operators), phone the Official MHIndustry HOTLINE in previous end note.

3. ‘Ah Ha & Uh Oh! Worksheet for calculating ‘affordable’ & ‘risky’ new & resale price points for homes going into LLLCommunities or site conveyed fee simple, use the Official MHIndustry HOTLINE in end note # 1.

4. 21st Mortgage Corporation, Triad Financial Services, Inc., CU Factory Built Lending, U.S. Bank – Manufactured Housing Finance, & Green Hill Financial; as well as Vanderbilt Mortgage and Finance, Inc. (latter = Clayton Homes’ in – house chattel lender)

***

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November 24, 2013

Land-lease-lifestyle Communities = Future of Manufactured Housing!

Filed under: Uncategorized — George Allen @ 5:51 am

George Allen Writes About Key MHBusiness Interests & Concerns – & More….

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

Purpose of this blog. To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!’

Ways to respond: Critical responses & helpful ideas Welcome for future blog coverage; gfa7156@aol.com; Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

***

News for Today, Tomorrow & 2014, You’ll not get from anyone or anywhere else!

Some reading this blog posting, have not been making my transition to semi or full retirement easy – or even possible. Several weeks ago, I’d pretty much decided to sell – out (Yes, there was a verbal offer on the table, ‘to pick up where I leave off…’, but that’s all it turned out to be); even discussed the sensitive matter with a ‘mutual friend in the MHBusiness’, while on Marco Island, FL. during Rent Manager® annual user’s conference. OR, whether to launch the much ballyhooed NEW ERA business alliance for land-lease-lifestyle community owners/operators, large and small, nationwide.

Well, now comes word of a national meeting maybe being planned (Not by me) for ‘seriously interested parties’, early in 2014, to gauge the level of interest in, and garner commitments to, found a new national entity that’d ensure even – handed national advocacy, apropos statistical research, resource updating & distribution, regular print & online communication, affordable peer networking & deal – making opportunities, along with professional property management training & certification. Since those are the same seven function areas identified with the new Community Owners Business Alliance, the announcement caught my attention. Main Difference? This latest initiative is apparently inclusive of ALL post – production components or segments of the HUD-Code manufactured housing industry, not just the land-lease-lifestyle community folk.

As I’ve said before, I have no desire to head any new organization! After all, I’m trying to slow down, not assume more responsibility. But I’m certainly interested in any credible national presence, new and otherwise, focused on providing the seven aforementioned functions to MHBusinesses Large and Small! And frankly, we won’t really know until (1) the sale of GFA Management, Inc., dba PMN Publishing assets is consummated with a qualified, industry experienced, motivated entity or party; or (2) an alternative new national presence is established; or, (3) the much heralded NEW ERA dawns for land-lease-lifestyle communities at the start of the New Year 2014! So watch your postal mail closely, and read the December issue of the Allen Letter professional journal, for details as to how YOU can participate in the Community Owners 7 Part Business Alliance, or ‘COBA7’, for short. GFA

I. I.

Land-lease-lifestyle Communities=The Very Future of Manufactured Housing Industry!

II.

HAVE YOU GONE ‘LIFESTYLE’ YET?

III.

Where Will YOU Be on 21 January 2014?

IV.

Visit New Manufactured Home @ RV/MH Hall of Fame in Elkhart, Indiana.

We Continue to Receive Responses to this Blog & Pithy Matters Contained Therein…

***

OK, This is a Long Blog Posting, so Hang On & Let’s Go!

Land-lease-lifestyle Communities=The Very Future of Manufactured Housing Industry!

The following bold statement by a veteran land-lease-lifestyle community owner was posted online recently, ‘setting the new home shipment stage’ for the present & near future of HUD-Code manufactured housing nationwide…

“We, land-lease-lifestyle community owners/operators ARE the future of the manufactured housing industry! Independent (street) MHRetailers can not compete with us because

1) We can, and should, sell new manufactured homes at or near COST (i.e. ‘Making new manufactured homes sited in land-lease-lifestyle communities, the most Affordable Housing alternative available in the U.S. today!’); and,

2) We have superior ability and experience cultivating chattel finance lending models (e.g. Securing $ support from private investors, lending sources in local housing markets, etc.) to support the on – site marketing and sale of new and resale homes!

Therefore; HUD-Code home manufacturers, continuing to suffer historic low new home shipment levels, have little to no choice – if they’re paying attention and indeed want to prosper, than to cater to the housing design, size restrictions, and feature needs/wants of land-lease-lifestyle community owners/operators, large and small, nationwide – as we buy their new homes, to resell to prospective homebuyers/site lessees!” (Edited. GFA)

‘WOW!’ And to that pithy and challenging statement, I’d simply add: It’s estimated there’re approximately 250,000 vacant rental homesites among 50,000+/- land-lease-lifestyle communities nationwide! HUD-Code ‘new manufactured housing shipments’ continue, after five years, to languish in the 50,000 – 60,000 range, down from the short – lived renaissance of 372,843 new homes shipped during 1998. Yes, some HUD-Code home manufacturers have learned how to market Community Series Homes, or CSH models*1, by the dozen, to some, but not all, 500+/- known property portfolio owners/operators of land-lease-lifestyle communities in the U.S. and Canada (A half dozen Canadian firms own many LLLCommunities throughout the U.S.) – by accessing the exclusive, confidential ALLEN REPORT contact data base via PMN Publishing.*2 However, most of them do NOT have A CLUE how to reach the 85 percent of 50,000 properties, numbering fewer than 100 rental homesites apiece! THAT will (should) be their corporate challenge during 2014, IF they want to push new home shipment volume above 60,000 during the next 12 months. Is that possible? Sure. Not as easily as the ALLEN REPORT -based Direct Mail campaigns (@ $1,000 per access) to 500+/- portfolio ‘players’; but doable, nonetheless.

HOW? Let me first suggest how NOT to strategize marketing CSH Model homes to the estimated 42,500 smaller land-lease-lifestyle communities nationwide.

1) Do not announce and host a national meeting, to this end, with a generic ‘feel good’ agenda, in some high – priced downtown venue! That’d be a patent waste of time and valuable resources, with little to no useful results. Rather;

2) Announce the nature and goal of this major problem – solving challenge, via every manufactured housing and land-lease-lifestyle community – related print and online media available! Invite anyone and everyone – businessmen and women owners of factories and land-lease-lifestyle communities alike, large and small, but willing to Invest in a FOCUS Group Strategic Brainstorming Session, to do these three things:

• Prepare and send advance correspondence to the meeting planner, listing ideas, as well as creative, even routine ways to identify & reach out to this difficult to reach market (i.e. 42,500 Mom & Pop – sized, often passive investors, who don’t belong to MHTrade bodies or read MH print & online newsletters, & ezines.)

• Register for, and arrange to arrive the night before said meeting, at an economical host hotel located an easy distance from a major Midwest international airport. Come prepared to spend a full day engaged in the most important Strategic Brainstorming Session of their business career! Use a professional facilitator.

• Walk into that FOCUS Group Strategic Brainstorming Session committed to fully participate, and not be satisfied until this national MHInitiative® has generated ideas, creative and routine ways, to identify and reach out to market and sell new manufactured homes into 42,500 land-lease-lifestyle communities nationwide!*3

Hey Out There! Are the HUD-Code manufactured housing industry’s ‘elected & salaried national & regional leaders’ listening, reading, paying attention to what’s going on around them, and how – at present – we’re ‘Going Nowhere Slowly’?! Here’s how to tell. Watch to see & read what ‘They say & do’ during the days & weeks – not months, ahead

In the meantime, as usual, let me know where YOU stand on this timely, key issue: ‘How to market and sell more HUD-Code manufactured homes into land-lease-lifestyle communities – of all sizes, filling as many as 250,000 vacant rental homesites ASAP, from coast to coast!’ Use contact information listed at the beginning of this blog posting.

End Notes.

1. Community Series Homes description and list of features, available FREE, by phoning Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also contains names of manufacturers’ Business Development Managers.

2. What’s a portfolio owner/operator? Sole proprietor, partnership, corporation, or REIT, owning/fee managing minimum of five LLLCommunities and or minimum of 500 rental homesites. To access the 500+/- name list of land-lease-lifestyle community owners/operators, phone the same number listed in end note # 1.

3. What’s an MHInitiative®? It’s the catch-all term that’s replaced the National State of the Asset Class caucus moniker used successfully during 2008 & 2009, to rally MHIndustry & LLLCommunity businessmen and women to 1) take control of their collective business future, and 2) agree on a new line of manufactured homes for placement in LLLCommunities, i.e. Community Series Homes or CSH Models. Frankly, it’ll take a new and fresh MHInitiative® to get the MHIndustry ‘moving again’. But this time it’ll be up to our elected and salaried national leaders to seize the initiative and exercise leadership in solving this five year long stalemate, now malaise.

II.

HAVE YOU GONE ‘LIFESTYLE’ YET?

BUILDING EXCELLENCE is the (annual) Official Magazine of the Canadian Manufactured Housing Institute. Well, the 2013 edition arrived this past week, filled with interesting and enlightening articles relative to manufactured and modular homes (design) in Canada. And there were articles headlined as follows:

FACTS ABOUT LANDLEASE COMMUNITIES

‘Ask and Compare – FINDING THE RIGHT (LANDLEASE) COMMUNITY

And, this one: Parkbridge, ‘Your bridge to smarter living’. But know what really caught my attention about this? The full and proper name of the firm:

Parkbridge Lifestyle Communities, Inc.

If the firm’s name sounds familiar, it should. In the 24th annual ALLEN REPORT, Parkbridge Lifestyle Communities, Inc., was listed as the eighth largest owner/operator of land-lease-lifestyle communities in the world!

But that’s only half the story. Everyone reading this blog posting is also likely familiar with the real estate investment trust (‘REIT’),

Equity Lifestyle Communities, Inc., or ELS, Inc.

According to the 24th annual ALLEN REPORT, ELS, Inc., is the Largest Owner/operator of Land-lease-lifestyle Communities in the world!

Boy, talk about confirmation of ‘being on the right track’, where the evolution of business terminology is concerned, relative to our unique, income – producing property type! If the largest U.S. owner/operator, and Canada’s largest owner/operator of property portfolios comprised of land-lease-lifestyle communities, find it appropriate to incorporate the word ‘lifestyle’ into their full and proper name, why not YOU? Think about it!

Furthermore, reading of ‘landlease communities’ throughout BUILDING EXCELLENCE, also confirmed my conviction that we’ve finally, after decades of experimentation, hit upon the right choice and combination of descriptive words to describe our (again) unique, income – producing property type! And perhaps during the next year or two, our Canadian neighbors will follow our lead, and insert hyphens into the descriptive term:

Land-lease-lifestyle Community!

***

III.

Where Will YOU be on 21 January 2014?

Me? I’ll be attending Rishel Consulting’s One Day $95.00 Seminar in Louisville, KY (That’s the day BEFORE the Louisville MHShow begins), Learning What Can & Not Be Said & Done, by Sales Professionals, While Selling Manufactured Homes – so as not to run afoul of regulators! Ignorance of regs is not an excuse.

For more information, and or to register, simply phone (217) 899-9268. A friendly piece of advice. This special, one day specialty sales seminar will sell – out quickly, so don’t delay signing – up. I’ve already done so! See YOU there? Hope so!

When we do see each other, ask me for a FREE plastic wallet card featuring the ‘5-RPs of Marketing!’ (‘RPs’ being Right Product, Right Place, Right Price, Right Promotion, Right People!) No one else has this practical marketing tool, so be sure to get yours at the Rishel seminar, and use it to fill more vacant rental homesites throughout your land-lease-lifestyle community!

George Allen, CPM®Emeritus, MHM®Master

IV.

Visit New Manufactured Home @ RV/MH
Hall of Fame in Elkhart, Indiana.

Visitors to the RV/MH Hall of Fame now have a new manufactured home exhibit to tour, outdoors and adjacent to the museum and library facility, thanks to the generosity of Nappanee, Indiana – based Fairmont Homes, according to Barry Cole, chairman of the board of the RV/MH Heritage Foundation.

What’s the RV/MH Hall of Fame? Well, the RV/MH Heritage Foundation was formed on 22 March 1972 by a group of trade and consumer magazine publishers attending an MHMA (‘Manufactured Housing Manufacturers Association’ predecessor to the Manufactured Housing Institute) meeting in Washington, DC. In early 2007, the RV/MH Heritage Foundation moved into its’ new facility at 21565 Executive Parkway, in Elkhart, IN. The 56,000 square foot building houses the RV/MH Hall of Fame, honoring hundreds of industry leaders past and present, a museum of vintage RVs & MHs from 1913 into the 1970s. For hours of operation, phone (800) 378-8694. And when phoning, inquire about becoming a Lifetime RV/MH Wall of Fame member of the heritage foundation!

We Continue to Receive Responses to this Blog & Pithy Matters Contained Therein…

“George, I love your piece on Meeting Fatigue, and critique of the (lack of) balance of power in national MH (advocacy) trade groups. I think you are ‘spot on’ in your analysis, and as always, I admire your courage to ‘Speak the truth to those in power!’” CC

EDITORIAL RESPONSE: If you missed ‘Meeting Fatigue’, at this website, simply scroll back to blog # 271 to read it. AND know this: ‘Speaking the truth to those in power’ can have uncomfortable consequences. FOR EXAMPLE. Thirteen months ago, I walked into a meeting of one of the groups referenced here, and was verbally ambushed in public by its’ leader – and given NO opportunity to respond to charges he made, and that have been left unsubstantiated to this day! Nor has there been any apology for this cowardly breach of public propriety by the individual or host national advocacy body. POINT? Be careful and steadfast about what you say and or write about business matters. And be prepared to stand your ground when challenged or assaulted by those who should be’ listening & learning’, rather than ‘reacting & fighting’! GFA

“I agree with your comments about our national (advocacy) organization. I’m afraid it, and one of its’ divisions, have run their course, as far as representation of smaller and mid – size land-lease-lifestyle community owners is concerned! Let’s face the fact, it is only interested in larger LLLCommunity operators. With that said, let’s form a new organization that better supports the interests of thousands of smaller owners/operators in the U.S. Considering the buying power of such a group, I don’t think we’d have any trouble getting home manufacturers to send (floor) dues, for the new homes we buy, to such an organization.”

EDITORIAL COMMENT. This is the opinion and suggestion of the person who penned this response to the Meeting Fatigue blog posting. And frankly, it contains more than a kernel of truth, when one observes how few direct, dues – paying members there are after 17 years of existence, how very few (less than a dozen) attend periodic meetings, and how present leadership continues to be in the hands of a very few large property portfolio operators (Not owners). Personally; I’m not interested in forming a new organization for the 85% of 50,000+/- LLLCommunities in the U.S. But what I ‘am for’, is the launching of a NEW ERA, during January 2014, in how product and service needs of land-lease-lifestyle community owners/operators nationwide, are researched, prepared, paid for, and distributed! As was pointed out in the introductory paragraphs to this week’s blog posting, during December, be watching your USPS mail for information on this new business alliance, and read about it in the Allen Letter professional journal! In the meantime, ‘if you want to talk about it’, phone the Official MHIndustry HOTINE: (877) MFD-HSNG or 633-4764. GFA

***

George Allen, CPM & MHM
Box # 47024, Indpls, IN. 46247
(317) 346-7156

Comments (0)

November 17, 2013

MEETING FATIGUE Triggers Insight…

Filed under: Uncategorized — George Allen @ 5:43 am

George Allen Writes About Key MHBusiness Interests & Concerns – & More….

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

Purpose of this blog. To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!’

Ways to respond: ‘Critical responses & helpful ideas Welcome for future blog coverage; gfa7156@aol.com; Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

***

In Cape May, NJ, last weekend dining on fresh seafood, then attending 50th high school reunion; so, no blog posting on Sunday. Sorry bout that.

***

Meeting Fatigue

INHALE! Nearly two dozen manufactured housing industry – related national and regional meetings have finally ‘run their course’. EXHALE! Between the RV/MH Hall of Fame Banquet in early August, and two meetings occurring a couple weeks ago (LCS’ Rent Manager User Conference in FL., & ULI’s Manufactured Housing Communities Council in Chicago), we’ve endured ‘meeting hell’, while seeing the latest MHIndustry ‘new trend’ unfold….

Oh, the old standbys are still with us – as they should be. One of them, the RV/MH Heritage Foundation is the protector and perpetuator of ‘our legacies’ relative to manufactured housing and recreational vehicles. Were you among the 400+/- aficionados at this year’s Hall of Fame Induction Banquet? You should have been! More important though; are you a faithful financial supporter of the RV/MH Heritage Foundation? You should be! Phone (800) 378-3466 to donate & become a Wall of Fame lifetime member.

And one has to expect the Manufactured Housing Institute (‘MHI’) will always have its’ annual meeting in the Fall, along with its’ now 17 year old National Communities Council (‘NCC’) division – even if only a dozen members of the latter attend.

But here’s where the aforementioned ‘new trend’ surfaces in grand style, showcased by three gatherings, one regional and two national, sharing this ‘telling’ common denominator: Not one was planned or hosted by a state or national manufactured housing – related trade or advocacy body!

The 22nd annual International Networking Roundtable took place, this year, in the Chicago region, enjoying its’ second highest attendance ever, at 222 attendees – mostly land-lease-lifestyle community owners/operators, and their favorite realty mortgage originators, from throughout the U.S. Planner and host? GFA Management, Inc., dba PMN Publishing, and community-investor.com

Then came SECO2013. This is at least the third year in a row land-lease-lifestyle community owners/operators domiciled in Georgia, pulled together to put on a terrific display of product (i.e. More than a half dozen new HUD-Code manufactured homes of the Community Home Series or CSH Models), along with pithy seminars dealing with various aspects of self – finance of on – site home sale transactions, using private investor funds, all the while being compliant with the plethora of state and federal finance regulations! Why can’t our state and national MHAssociations do the same? For info on future SECO gatherings, contact Spencer Roane, MHM® via (678) 428-0212. He’s, by the way, our industry’s expert on use of lease-option (leaseoptionmhsales.com).

And, for that matter, if you want someone to bring a chattel finance compliant workshop to your ‘neck o the woods’, contact Rishel Consulting via (217) 971-3968. He and Donna will be hosting a day long seminar on 21 January, the day before the annual Louisville MHShow begins. It’ll focus on ‘selling manufactured homes’ effectively and in accords with today’s regulation – rich business environment! Know what? I plan to attend and learn more about this timely and pithy subject. See you there!

And this past week, London Computer Systems, of Ohio, held their Rent Manager User Conference on Marco Island in Florida. 400+/- ‘users’ from a variety of multifamily and commercial property type applications were in attendance – including a dozen portfolio owners/operators of land-lease-lifestyle communities!

Know what all three latter (post RV/MH Hall of Fame banquet) well – attended ‘industry meetings’ had in common, besides being planned and hosted by grassroots businessmen and women, product and service vendors? Not a single representative from any of the national advocacy bodies was present as an attendee, or seminar leader, or special guest at any of these (and other) ‘new trend events’.

Is it any wonder, or surprise, this ‘independent meeting trend’ is growing throughout the manufactured housing industry? Answer? No. Think about it.

During conversations this past week – and earlier, in downtown Chicago; among manufactured housing purists and land-lease-lifestyle community owners/operators, this very question was the focus of attention. And know the common strain of logic that emerged? Simply this:

National manufactured housing trade advocacy bodies continue to be ‘dominated by HUD-Code home manufacturers’ – a few large ones in one instance, many smaller ones in the other. And of late, the division formed, years ago, to represent land-lease-lifestyle community owners/operators, large and small, has also become ‘dominated by a few large property portfolio firms’, seemingly with little to no sensitivity to the needs of the far greater number of smaller property portfolios and LLLCommunities throughout the U.S.

Is there a resolution to these lopsided representation and power issues? Sure; maybe in time. But only ‘if & when’ MHI’s bylaws are rewritten to – among other things – allow absentee members (i.e. Those who can’t afford – or won’t ‘waste $’, to attend national advocacy association meetings held in extravagant, high – priced venues) to execute Proxy Votes, making their leadership preferences known! And, there must be more emphasis on recruiting new members, once this ‘voter playing field’ has been leveled, and smaller ‘players’ truly made Welcome and assurance their needs will be met.

How do YOU feel about this and other issues being discussed by your peers around the country? To respond, use the contact information listed at the beginning of this blog posting.

***

George Allen, CPM & MHM
Box # 47024, Indpls, IN. 46247
(317) 346-7156

Comments (0)

November 3, 2013

Two Key Questions re LLLCommunities Future

Filed under: Uncategorized — George Allen @ 5:58 am

‘George Allen Writes About Key MHBusiness Interests & Concerns!’

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

Purpose of this blog. ‘To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!’

Ways to respond: ‘Critical responses & helpful ideas Welcome for future blog coverage; gfa7156@aol.com; Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

GUESS WHO?

“…owns and operates portfolio of resort communities and lifestyle oriented properties. It leases individual developed areas with access to utilities for placement of factory – built homes, cottages, cabins and recreational vehicles.”

This euphemism* – heavy summary describes a land-lease-lifestyle community (A.k.a. manufactured home community, and before that, ‘mobile home park’) portfolio firm, and is copied from Yahoo Finance. GFA

Two hints & a question. This is one of 500+/- land-lease-lifestyle community portfolio domiciled in North America; it’s been listed in the annual ALLEN REPORT for 24 years – under different names. Why avoid mentioning manufactured housing?

* Euphemism: ‘Polite and often affected expressions used in place of common terms which can be considered offensive.’ From Collection of Figurative Language & Figures of Speech, PMN Publishing, Franklin, IN., 2011, p.13.

II.

‘Two Key, ‘50,000 Land-lease-lifestyle communities’ – related Questions’

prompted by reading Ann M. Burkhart’s 16,478 word article titled:

‘Bringing Manufactured Housing into the Real Estate Finance System’

Copyrighted by Pepperdine University School of Law, as published in the Pepperdine Law Review during 2010, this ‘backgrounder’ was followed by the Uniform Law Commission’s adoption, on 19 July 2012, of the Uniform Manufactured Housing Act, recommending adoption of (state) statutes, enabling (manufactured) housing owners to title or re-title their homes as real property, “…if connected to electrical utilities and (when) a certificate of location is filed with the local deed office.” Quoted from Center for Economic Development’s 2012 Annual Report. And visit CFED online, for lender, homeowner and industry ‘briefs’ posted during year 2013.

Make no mistake about it, this proposal cum ‘would be’ statute is alive and well in the minds and plans of certain social activists, local tax assessors in search of more tax revenues, and certain bank(s) – none of which have examined the effects of such legislation on 50,000+/- land-lease-lifestyle community businesses nationwide!

Before we quote from said report, which makes many good points by the way, here’re at least ‘Two key, 50,000 land-lease-lifestyle communities – related questions’ to keep in mind as you read – and ponder – the effects of this proposed change, potentially affecting our business model, and your future as a LLLCommunity owner/operator:

1) Ms. Burkhart, why so little mention, let alone examination of, land-lease-lifestyle communities (A.k.a. manufactured home communities, & before that, ‘mobile home parks’) in this 38 page study, since this recommendation-for-change, if legislated, could/would profoundly affect this unique, income-producing investment realty asset class?!

2) And, just how do you see this proposed change (i.e. “Classifying all manufactured homes as real property from the time of sale to a consumer….” P.13) affecting the present day business model of owners/operators of 50,000+/- land-lease-lifestyle communities nationwide?

So, what’s in ‘Bringing Manufactured Housing into the Real Estate Finance System’, that’s prompted these two key questions?

Let’s begin with the LEXISNEXIS SUMMARY of the article, followed by its’ Conclusion. Then there’ll be quotations taken from three subsections labeled: ‘Today’s Manufactured Homes’, ‘Manufactured Housing Finance Model’, & ‘Increasing Credit Availability for Manufactured Housing’.

LEXISNEXIS SUMMARY. “…Misperceptions about manufactured homes are not limited to the homes but also exist about their residents. …Characterizing manufactured homes as real property would provide greater access to the secondary market, thereby increasing the flow of capital to lenders and lowering lending costs…The greatest potential for uncertainty exists in states that treat a manufactured home as personal property until it becomes a fixture or until the title has been converted to real property…Far fewer lenders make manufactured home chattel loans than make mortgage loans, especially since the manufactured housing market meltdown…In this situation, the legal protections afforded owners of manufactured homes should equal those afforded owners of site – built homes…Moreover, many state conversion statutes permit manufactured homes on leased land to be classified as real estate, which demonstrates the land ownership restriction is unnecessary.” P.1.

CONCLUSION. “Manufactured homes have changed dramatically since the introduction of their earliest counterparts in the 1920s. Unfortunately, the law has not kept pace. As a result, financing and other aspects of ownership are needlessly complex and uncertain, and access to affordable credit is limited, which has been a major obstacle to the industry’s recovery. Manufactured home owners are not accorded the same rights as the owners of site – built homes, though they often need greater protection. The failure to classify manufactured homes in the same manner as site – built homes has also caused the federal and state governments to overlook manufactured homes in the efforts to stabilize the home finance markets and to prevent similar crises in the future. Classifying all manufactured homes are real property from the time of sale to a consumer is a feasible and effective remedy for these problems.” P.13

Here we go…

Manufactured housing “…has the same characteristics as a site – built home and should have the same legal classification.” P.2. Perhaps NOT, if sited on a rental homesite within a land-lease-lifestyle community; as opposed to being built on a lot in a subdivision, or on a scattered building site -both conveyed fee simple.

“…manufactured home residents are less transient than residents of site – built housing. Whereas the average period of ownership for a site – built home is six years, sixty percent of manufactured home residents live in their home for more than ten years. Furthermore, seventy-eight percent of manufactured homes are owner-occupied, only sixty-eight percent of site – built home owners live in the home.” P.3. News to me, but reads well!

“Concerns about manufactured housing’s safety, appearance, and impact on neighboring property values are similarly misplaced.” & “Contrary to popular belief, manufactured home communities do NOT affect neighboring property values.” P.3. (Emphasis added. GFA) Again; news to me. Truth be told however, property valuation can go either direction; depreciation or appreciation, depending on 1) age and condition of homes sited therein, and 2) the overall care (e.g. curb appeal, rules enforcement, professional property management measures) in effect at the income – producing property.

“Manufactured home chattel loans should be included in the government relief programs not only because the homes are functionally equivalent to site-built homes…(but) because the manufactured home finance market and…rest of the manufactured housing industry has been struggling to recover from a meltdown that is virtually identical to the mortgage market meltdown.” P.4. It won’t happen; however, as long as (manufactured) homes, modular homes, ‘park model RVs’, etc., are sited on rental homesites in land-lease-lifestyle communities, increasing the risk of said residences being moved elsewhere.

“…the demand for new manufactured homes more than doubled from 1991 to 1998. Manufactured housing’s market share of new single-family homes sold during those years remained consistently above twenty-five percent. Initially, the increased sales were attributable to improved product design and construction standards, the rapidly increasing cost of site-built homes, and the expanding national economy.” P.4. NOTE. As most manufactured housing aficionados know, replacing the words ‘sold’ & ‘sales’, with ‘shipped & shipments’ respectively, in these sentences, tells more of the ‘real story’ – that ‘demand’ was/is largely artificial, as home manufacturers, chattel capital lenders and brokers, as well as some LLLCommunity owners/operators, colluded to ‘keep housing production lines moving’, often flooding local housing markets with unneeded and unsellable new homes! To underscore that sorry point, read the following half dozen quotes…

“…increased demand also was driven by the same bad lending practices that created the mortgage market bubble and caused it to burst. Risky behavior by manufacture home loan brokers…” p.4 NOTE. Insert ‘artificial’ between the first two words, ‘increased’ & ‘demand’.

Furthermore, “Manufactured housing dealers often act(ed) as loan brokers for their buyers. And customers “…preferred the convenience and speed of relying on the dealer to find a loan.” P.5. NOTE. Plenty of blame to be spread around…

‘…higher interest rates on manufactured home chattel loans, than on mortgage loans, were particularly attractive to them. In the resulting competition for borrowers, lenders began relaxing underwriting standards and loan terms. “Down payments decreased and the number of years over which the loan could be repaid increased. …lenders began financing homes for borrowers who clearly could not afford them.” P.5 NOTE. Nuff said, but…

“Hyper-aggressive sale and predatory lending practices became more common. Some dealers sold (HUD-Code) homes for as much as twice their fair market value.” P.5.

“…decreasing interest rates on mortgage loans made site-built homes more affordable. Despite the decreased demand, manufactured home production continued to increase.” P.5. NOTE. Recall the earlier observation about (forced) ‘shipments’ vs. ‘sales’

“In 2001, one-fifth of the homes that were sold were repossessed.” P.5.

All the while…

“…securitizations of manufactured home loans also greatly increased – from $184 million in 1987 to $15 billion in 1999.” P.5. NOTE. By year 2008 however, securitizations had dropped to $307 million! According to the ALLEN REPORT, land-lease-lifestyle community owners started picking up the slack, by ‘carrying’ contract sale paper on homes they sold on – site. Their paper value skyrocketed from a few million dollars in 1999 to more than $3.2 billion by 2009, and $5+ billion the following year! At the same time, new HUD-Code home shipments plummeted from a too brief renaissance ‘high’ in 1998 of 372,843 new homes, all the way down to what’s now been a five year nadir of 50,00+/- new homes shipped per year – a nadir that’ll likely continue until ‘readily accessible’ chattel capital returns to HUD-Code manufactured housing, and financial regulators back off!

Here it comes!

“Credit for manufactured home purchases would increase by characterizing all such homes as real property.” P.6. NOTE. Question: Even for those (manufactured) homes, on rental homesites, within one, more, or all 50,000+/- land-lease-lifestyle communities nationwide?

“Recognizing all manufactured homes as realty, from the moment they are sold to a consumer, would eliminate the obstacles that have prevented so many owners from obtaining the benefits of that classification. Universal treatment of manufactured housing as real property also would benefit lenders by creating national uniformity and by eliminating uncertainty.” P.7 NOTE. Perhaps so, but again, ‘What are the anticipated consequences for owners/operators of LLLCommunities nationwide?’ This is not addressed anywhere in this paper! ‘Why?’

Here’s an interesting and apt aside. At least one large commercial lender (bank) backing this conversion effort, has apparently not considered the likely chilling consequences of this action, on the land-lease-lifestyle communities they presently mortgage, nor their loan origination dollar volume in the future.

“…if the manufactured home is sited on leased land, the home will depreciate in value because home value appreciation normally is attributable to the land on which it sits.” P.7 NOTE. That’s not the whole story, and flies in the face of an earlier statement, that LLLCommunities ‘do not affect the value of nearby neighborhoods’. Which way is it? Frankly, there’re examples of ‘homes & LLLCommunities’ ‘appreciating& depreciating’ together in value, depending on ‘the land on which it sits’, AND the ‘condition of the home(s) per se’.

“Classifying manufactured housing as real property…will significantly change the methods for creating, perfecting, and enforcing a security interest in manufactured homes, and has important implications for property taxation, marital property rights, and homestead protections.” P.8. NOTE. Not much said in this report about the probable effects of said conversion affecting the type and amount of (real estate) taxes to now have to be paid by the homeowner. For example: “Manufactured home owners in some states will pay lower taxes if their home is real estate, but owners in other states will pay more.” P.11 versus “…the annual property tax rate for real estate is substantially higher than for personal property.” P.11. NOTE. Here’s a hidden agenda item: How, and by how much, the conversion of ALL manufactured homes to real estate, from their present personal property classification, will likely increase the tax base of local county coffers?

“The median monthly housing cost for manufactured home owners is $407. For tenants, it is $755.” P.10. NOTE. Really? Are we comparing ‘apples to apples here’? For example; are the same ‘housing cost’ factors built into both figures – or not? Easy to see $755/month as affordable conventional apartment rent somewhere – but inclusive or exclusive of utilities? And how ‘bout the $407? Is that inclusive of mortgage PITI (or is home ‘free & clear’), site rent, and utility bills for a month – or is water/sewer built into the site rent fee? Until those questions are answered, the dollar comparisons are misleading, if not meaningless.

“By classifying all manufactured homes as real estate, from the moment of purchase from a dealer, the uncertainties and costs of the current system will be substantially eliminated.” P.11. NOTE. And once again; what will be the tax consequences for the unsuspecting homebuyer; and, what will be the likely (nasty) consequences for the businessman or woman who owns the underlying investment realty – as in a land-lease-lifestyle community, a.k.a. manufactured home community, or ‘mobile home park’?

“Moreover, many state conversion statutes permit manufactu4rd homes on leased land to be classified as real estate, which demonstrates the land ownership restriction is unnecessary.” P.12. NOTE. Perhaps on scattered building sites, where someone is leasing a small parcel of real estate from a family member (e.g. as oft happens on a farm, among extended family); but what about when sited within a land-lease-lifestyle community? Industry experience with attempts, over the decades, to condominiumize (or, subdivide and sell homesites, within) this property type have met with mixed success at best. Major issue? How to effectively replace enforceable (by eviction) Rules & Regulations, often emplaced per state statute, with Covenants & Restrictions, no matter how tightly written, that are next to impossible to enforce (due to property rights issues) – beyond executing and recording a lien to be (maybe) resolved at some future date?

“…to treat all (manufactured) homes as real estate can be accomplished quite efficiently because the necessary legal and administrative apparatuses already are well established. Deeds are used for title transfers. In fact, at least two states already have statutory form deeds for manufactured homes.” P.12. NOTE. What two states? And are these statutory form deeds applicable to manufactured & modular, as well as ‘park model RV’ homes in land-lease-lifestyle communities?

“Lenders have adapted a long – standing finance tool, the multi – draw construction loan, to ensure the mortgage the buyer executes, at the time of purchase, has priority from that moment.” P.13.NOTE. And again; is this applicable to homes sited on rental homesites within land-lease-lifestyle communities; and if so, what are the probable consequences thereof?

Well, there it is, a digest of information published three years ago in ‘Bringing Manufactured Housing into the Real Estate Finance System”, now ‘making the rounds’ as recommended (state) legislation per the Uniform Law Commission. Has interest in the Uniform Manufactured Housing Act come to your state yet? Expect it to do so….

This is one of those rare times when being forewarned (‘Think of the possible consequences to you and your land-lease-lifestyle community business model!) is akin to being forearmed!

***
End Notes.

1. CFED: Center for Economic Development

***

George Allen, CPM & MHM
Box # 47024, Indpls, IN. 46247 (317) 346-7156

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October 27, 2013

Site Rent Credit Program, CSH & More….

Filed under: Uncategorized — George Allen @ 4:05 am

‘George Allen Writes About Key MHBusiness Interests & Concerns!’

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

Purpose of this blog. ‘To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!’

Ways to respond: ‘Critical responses & helpful ideas for future blog coverage, via email gfa7156@aol.com; Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

What Keeps Me Going?

Email messages like this! “They are a bunch of bullies, and I hate it (when) people you trust can’t be trusted. I now know you and (Carolyn) well enough to say: ‘One thing NO ONE can take from you is your integrity; you have more than most people can dream about. You say things how they are, and you are one of the few people in this world I never have to worry about what you are saying behind my back, because it’s the same thing you are saying to my face’.” SF

“How did the (MHI) annual meeting go? It sounds like not – so – well, which disappoints me. They wouldn’t allow proxy votes? Is that legal? You’ll always have my vote!” Responses to blog posting # 267.

II.

Musings from Chairman Zell

During the final session of the first day of NCC’s Fall Leadership Forum, MHI chairman Nathan Smith, prompted by a question from the audience, encouraged his interviewee, chairman Sam Zell of real estate investment trust ELS, Inc., to comment briefly on several personal ‘Thou Shalt Not’ business cautions. Three of these are described in the November issue of the Allen Letter professional journal.*1

What most forum attendees did not realize is, during year 2004, a small booklet was published with this Sam Zell quote as its’ title: “A picture is worth a thousand words.” And inside the front cover of the 3 ¾”X5”, 24 page mini-book, is this credit line: ‘Quotations From The Chairman’.

Here’re a few of Chairman Zell’s gems of universal (business) wisdom, found in said booklet:

• ‘Unless you’re the lead dog, the scenery never changes.”

• ‘Trying to be right 100% of the time leads to paralysis.”

• ‘If you’re not moving forward, you’re falling behind.”

• ‘With a long-term asset such as real estate it’s a lot better to be early than late.’

• ‘Be a risk taker; however, define risk by your own terms.’

Understand; each of these maxims is accompanied by an oft humorous pen and ink drawing, to illustrate and underscore the truth being communicated.

Where to obtain a copy of this publishing rarity? Have no idea. Contacted the copyright holder, Equity Group Investments, LLC., but to no avail. Perhaps one day, my sole copy – presently part of our extensive corporate library on ‘manufactured housing’, will wind up in the RV/MH Heritage Foundation’s Hall of Fame, Museum & Library in Elkhart, IN. Then you’ll be able to read and enjoy it in full.*2

III.

RENT CREDIT PROGRAM

Details of the following Rent Credit Program, allegedly used by one of the 500+/- known portfolio owners/operators of land-lease-lifestyle communities, was recently and publicly described by an industry consultant, during a manufactured housing plant show in Texas.

The drill goes something like this. The new or resale (manufactured) home is leased on a month-to-month basis, with lessee receiving 50 percent of the amount paid for rental of the home (excluding separate homesite rent) as a credit toward the purchase of any home sited throughout the LLLCommunity.

For example. If site rent is $300/month, and the home is rented for $400/month, the resident would accumulate a credit of $200/month, over time, to be applied toward eventual purchase of the home being lived in, or any other home, in the LLLCommunity. So, if sales price of the desired home is $25,000, the lessee would accumulate enough credit to buy it in ten plus years; e.g. $200/month X 12 months X 10 years = $24,000.

A caution. Not recommending this Rent Credit Program. Generally, leases can not involve equity accumulation (i.e. credit toward purchase of a home), or they’re considered a credit transaction and in violation of the S.A.F.E. Act. So, you should check on the matter yourself, with legal counsel, before starting the same, or a similar, program, on – site in your LLLCommunity.

Any other creative self – finance programs out there we should know about and consider?

IV.

Unfortunate, But Obvious Disconnect During NCC’s Fall Leadership Forum

Community Series Homes, a.k.a. CSH Model manufactured homes have been a staple of the HUD – Code scene since year 2009, when ‘smaller homes with durability – enhancing features’ were requested by land-lease-lifestyle community owners/operators, and were subsequently designed and manufactured by housing factories. At the time, they supplanted the ‘Big Box = Big Bucks’ Developer Series Homes made popular during the 1990s, and at the turn of the 21st Century, by independent ‘street’ MHRetailers enamored with the land-and-home package business model, and for a time, competed head-to-head with stick builders.

What’s a CSH Model HUD – Code manufactured home? From the Official definition: “…contemporary renditions of (the) popular (manufactured) homes of the sixties and seventies, featuring updated, attractive , functional and durability – enhancing features desired by homebuyers and land-lease-lifestyle community owners.” What are some of these features? 3BR2B design; open floor plan with ‘WOW factor’ interior design; shutters on windows; vaulted ceiling; asphalt shingles; linoleum in kitchen, utility room and front door areas; 40 gallon hot water tank; 200 amp service panel; wood cabinetry; non – plastic sinks and tubs.

Who manufactures Community Series Homes? Most HUD-Code firms; specifically, Adventure Homes, Cavco Homes, Champion Homes, Clayton Homes, Colony Factory crafted Homes, Commodore Corporation; Fleetwood Homes, Harmony Homes; Liberty Homes; and Titan Homes, to name a few. For a FREE ‘contact’ list of these firms, along with the names of their Business Development Managers or BDMs, simply phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. And, for that matter, if you’re a HUD – Code home manufacturer and your name is not on this list, but should be – use the same contact information and request to be added!

The aforementioned DISCONNECT? Several manufactured housing and land-lease-lifestyle community corporate and elected industry leaders held forth regarding today’s smaller (now slowly getting larger – again) HUD-Code homes with durability – enhancing features, but NONE of them, NOT ONCE, referred to them by their CSH Model ‘handle’. Go figure.

As a somewhat related aside, regarding home features; there was a point during one panel presentation, when history seemed to be repeating itself. This occurred during Stephen Braun’s (Hometown America) description of how his firm’s ‘age – qualified residents’ have indeed ‘aged’, and now his firm is faced with ‘repopulating’, via implementation of service improvements and socialization efforts. Kudos to Hometown America for recognizing and dealing with the challenge! But know what? This is not the first time that matter has been identified. More than a decade ago, Randy Rowe – then still head of Hometown America, along with some of his LLLCommunity owner/operator peers, encountered a similar challenge. Guess what they learned from their experience? Go ahead and make adjustments to homes (e.g. raise driveway to entry door threshold level, install grab bars and panic alarms, and wheel chair accessible vanities), and offer new services (transportation, and meals at clubhouses), but expect to encounter stiff resistance from – guess who? ‘Age – qualified’ but younger, still healthy and mobile residents, who do NOT want to be visually reminded of what’s likely in store for them during the next several years!

***
End Notes.

1. To subscribe to the Allen Letter professional journal, telephone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. $134.95/year

2. To become a lifetime member of the RV/MH Heritage Foundation’s ‘Wall of Fame’ (as I & many others are), phone (574) 293-2344.

***

George Allen, CPM, MHM
Box # 47024, Indpls, IN. 46247
(317) 346-7156

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October 20, 2013

Blog Has Name! & NCC Forum = Precursors?

Filed under: Uncategorized — George Allen @ 5:02 am

‘George Allen Writes About Key MHBusiness Interests & Concerns!’

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.”

Purpose of this blog. ‘To be the national advocacy voice, statistical research reporter, & communication resource for LLLCommunities, of all sizes, throughout North America!’

Ways to respond: ‘Critical responses & helpful ideas for future blog coverage, via email GFA7156@aol.com or Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

Did You Notice? This Blog Now Has a Name!

This popular weekly blog, with more than 300 postings to date, to 1,000+/- weekly readers, needed a working name, to be featured by Amazon.com. So we penned a word picture of what the posting has been doing for the past six plus years: ‘George Allen Writes About Key MHBusiness Interests & Concerns!’ in behalf of HUD – Code manufactured housing industry aficionados & land-lease-lifestyle community owners/operators, large and small, nationwide!

And it seems apropos, to inaugurate this formally – named presence, during the same time frame MHI’s National Communities Council hosted its’ first Fall Leadership Forum, in Chicago, Il; featuring #s, summary and commentary info regarding the event.

II.

NCC’s First Fall Leadership Forum;
a Precursor, in More Ways Than One?

A month ago, the 22nd International Networking Roundtable attracted 220+/- land-lease-lifestyle community owners/operators and their favorite realty mortgage lenders to the Chicago suburb of Bloomingdale.*1 Last week, Spencer Roane, MHM® and a half dozen or so Georgia – based LLLCommunity owners hosted at least 110 of their peers at the annual SECO 2013 Symposium in Forsyth – where no fewer than eight new HUD – Code Community Series Homes, or CSH Models were on display!*2 Also last week, the Manufactured Home Communities Association of Arizona, under the leadership of Susan Brenton & Neil Haney, rallied 100+ members, for two days of seminars and networking!*3 An easy to miss common denominator: Nary an MHI or NCC elected or salaried leader was present at any of these three events, attracting more than 400+ MHIndustry & LLLCommunity businessmen and women.

On the other hand, less than a month ago, on 30 September 2013, the National Communities Council (‘NCC’) division meeting in Carlsbad, CA., convened with only 14 land-lease-lifestyle community owners/operators in the room (out of 17 registered for MHI’s annual meeting – which drew, by the way, 116 in toto, from all segments of the MHIndustry d& LLLCommunity asset class).

Now, a scant two weeks following NCC’s meeting/elections in CA, the council has hosted its’ first Fall Leadership Forum in downtown Chicago, IL. Promoted as ‘Building a Vision for the Future’, the event attracted 149 registered attendees (with, I’m told, 31+/- sign – ups at the door). When the final session, a panel led by Randy Rowe, and titled, ‘The Future of the Land-Lease (Community) Business Model’ occurred mid – morning Friday, 50 individuals remained in attendance.

First ‘the numbers’; related solely to the aforementioned 149 registration list – which, by the way, contained NO helpful contact information for anyone. Go figure.

70+/- of the 149 individuals listed, were land-lease-lifestyle community owners/operators from 22 property portfolio firms (out of the 500+/- known nationwide), plus 19 small, or Mom & Pop – sized property owners. Taken together, 41 LLLCommunity sole proprietors, partnerships, corporations, and two REITs were represented. Furthermore; of the 22 portfolio ‘players’ present, half – or ten of them (i.e. along with their 31 executives) hailed from Chicago and the city’s surrounding suburbs! And of the same 22 large portfolio firms, nine ranked among the 20 largest LLLCommunity firms identified in the 24th annual ALLEN REPORT.*4 Who was missing from that august Top 20 ranking? One REIT, four California – domiciled firms, two Canadian portfolios, and one company each from FL, WA, & MI. These numbers, by the way, are ‘off by one’, due to liquidation of ARC.

Who rounded out the 149 registrants? 20+ lenders ‘of all stripes’ (i.e. chattel & real estate mortgage originators), 14 HUD – Code home manufacturers (e.g. multiple reps from Clayton Homes, Champion Homes, Cavco, Adventure, Skyline, & Fairmont), nine freelance consultants & seven real estate brokers (at least three of whom doubled as single LLLCommunity owners), seven insurance agents, more than a half dozen attorneys, five state MHAssociation executives, and several ‘your guess is as good as mine’ hangers on.

What was learned during this two day forum? That’ll be covered in more detail in an upcoming issue of the Allen Letter professional journal.*5 For now, however, suffice it to say:

• When listening to ‘What the Industry Can Learn from the Small Operators’, some walked away with a better ‘feel’ for compensation packages now in play around the country, based on the number of rental homesites in a land-lease-lifestyle community, variety of job responsibilities – including ‘new & resale home sales’, put on the shoulders of on – site property managers, and other considerations. Details to follow.

• During another panel, ‘Tackling the Obvious: More Action, Less Reaction’, at least one really good ‘refurbishing of manufactured homes’ tip was shared and had everyone’s pen moving at the same time. Details to follow.

• For many in the room, the most informative and thought – provoking hour of the entire forum, occurred when NCC chairman David Lentz, & HAS Capital’s J. Peter Scherer, co – presented ‘Home Financing in the Future’. They first provided statistical background information as to ‘Where we’ve been’, as an industry; then, ‘Were we’d like to go’, but don’t know – at this point – how to get there! They diligently sought to identify a New (chattel capital) Lending Model for manufactured housing and on – site housing sales within LLLCommunities – even creating a new paradigm if need be, that’d also facilitate ‘third party financing’ of new and resale homes, based on ‘risk’ and ‘alignment’. Bottom line? NO answers – but some enlightenment in two areas: FIRST, ‘What we must do individually and collectively (re: property portfolio $ policies and procedures), to entice chattel capital back to our industry; and SECOND, ‘Why we’d best step back, and realize that ‘this bird that quacks like a duck is likely a duck’, and call it – this New Lending Model, what it is and will continue to be: ‘The 15%’er Solution!’ How so? Well, there’s ‘more than a hint’, as to why, elsewhere in this blog posting. But for the complete, albeit blunt description of said New Lending Model, read the Allen Letter professional journal – the only MHIndustry trade publication that’ll share this hard truth with you!

Oh Yes, there was more. More than we’re going to cover here, or in the aforementioned newsletter. But for now, suffice it to say, Nathan Smith’s interview with Sam Zell was another highlight of this forum. In it, Zell commented briefly on the lease-option fad (my word choice, not his) popular with single family site – built housing these days; probable future of the GSEs; how ‘low interest rates are addictive, even suicidal when consistently lower than the inflation rate’; his views on RVs & MHs in the same mixed use land-lease-lifestyle community property; Washington’s ‘wealth redistribution track’; and finally, three of his ‘Thou Shalt Nots….’ Again; details to follow in the Allen Letter professional journal.

Finally; try this on for size. First; re read the fifth paragraph of this Part II to the blog posting (“70+/- of the 149…”). Done? OK; now ask yourself the following question, in light of this inaugural event being in downtown Chicago and 50 percent of property portfolios present, being from ‘the Chicago area’: Was this the second attempt, during the past few years, to suggest moving the seat of land-lease-lifestyle community power Westward from the nation’s capitol? Frankly; I wouldn’t have remembered or thought about that possibility, if it hadn’t been for three LLLCommunity owners suggesting it privately during one – on – one conversations. Think about it.

***
End Notes:

1. For an ‘invite’ to the 23rd annual International Networking Roundtable in early September 2014, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-5764.

2. For an ‘invite’ to the annual SECO 2014 Symposium, during the Fall 2014, phone (678) 428-0212

3. For an ‘invite’ to next Fall (2014) meeting(s) in Arizona, phone (480) 345-4202

4. 24th ALLEN REPORT available FREE, for a limited time, by phoning the above referenced (End Note @ 1) Official MHIndustry HOTLINE. The 25th anniversary ALLEN REPORT will likely be published as a lagniappe in the January 2014 issue of the Allen Letter professional journal. HINT. Suggest you subscribe to the newsletter ASAP – before the NEW ERA dawns in January, when a whole new Business Model for serving the research, resources, communication, networking, deal – making, and professional property management training/certification needs of LLLCommunity owners/operators nationwide, is implemented….

5. Ibid

III.

With NCC Outa the Way, a NEW ERA to Begin

The NCC Fall Leadership Forum inspired Three Exciting Projects to likely occur during year 2014. And all three relate to the increasingly talked about Dawning of a NEW ERA for land-lease-lifestyle communities:

• A Spring Retreat for owners/operators, patterned after two decades of land-lease-lifestyle community FOCUS Group gatherings. Likely in late March or early April, at an inexpensive, easy-to-access hotel in a relaxing, resort setting. Never been to a FOCUS Group before? Well, we solicit ‘your choice’ of hot topics, schedule five of them, then convene ‘the night before’, at a restaurant for a group networking meal, followed by a day of Open Group Discussions led by LLLCommunity – experienced moderators. Sometimes even held on – site if a LLLCommunity clubhouse is located nearby. Seriously interested in being on the ‘invite’ list? Let me know via the Official MHIndustry HOTLINE or via email: gfa7156@aol.com

• 23rd annual International Networking Roundtable, to be at a ‘killer time’ this year, and featuring a Surprise – but – obvious choice, actually maybe two, for keynote presenters! Looking closely at a lower Midwest location often requested by past INR devotees…

• Exciting Theme for a New LLLCommunity Book! To be comprised of writings submitted by successful land-lease-lifestyle community owners/operators, willing to share their personal and corporate Lessons Learned, as well as Secrets of Their (& Firm’s) Success, along with Pithy Insights realized with their business peers. Want to participate? Open to owners/operators of LLLCommunities ‘of all sizes’, nationwide, even our peers in Canada. Also; interested in underwriting the printing cost of the new book – like Marcus & Millichap did with Bruce Savage’s The First 20 Years! ? If so, let me know. Call for submissions will occur within a future issue of the Allen Letter professional journal.

That’s all for now. There is much more to come; but for now, ‘read between the lines’! GFA
***

George Allen, CPM & MHM
Box # 47024, Indpls, IN. 46247
(317) 346-7156

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