George Allen / EducateMHC Blog Mobile Home & Land Lease Community Advocate & Expert

Blog # 223 Copyright 2012 9 December 2012

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

I.

I’m Happily Moving On with My Business Life!

II.

Symptoms of Troubled Land Lease Lifestyle Communities!

III.

Own LLLCommunities & Want to be Charter Member of MHCA?

********

I.

I’m Happily Moving On with My Business Life!

It’s been two months and a day, since 8 October 2012, when I and another dues – paying member of a national manufactured housing advocacy body, were verbally assaulted without warning or cause, before 70 or so of our peers – including but a dozen bona fide owners of land lease lifestyle communities – at a national gathering of fellow manufactured housing industry businessmen and women.

Since then, the elected officers of the parent body hosting said meeting, have dodged responsibility for their colleague’s attack. They confirmed their position in a letter from their attorney, that arrived 30 November, the date I’d set as a personal deadline to get this sorry matter resolved, hopefully with an apology and copy of the script read to castigate the other dues – paying member and myself. Neither happened.

So, why am I not particularly upset, and happily moving on with my business life? As you likely know, I have opportunities and the wherewithal, as an author, to write and publish contemporary histories of the manufactured housing industry, and it’s sister segment, the land lease lifestyle community real estate asset class! *1 My day will surely come….

II.

Symptoms of Troubled Land Lease Lifestyle Communities!

Following data based on 200 rental homesites @ $200/month rent.*2

Yes, some of you reading this posting have seen these ten symptoms before. But since they continue to be one of the most frequently requested training aids, right there along side the…

• ‘Ah Ha! & Uh Oh! Worksheet’ calculates ‘affordable’ & ‘risky’ Price Points, using Area Median Income (‘AMI’) &/or Annual Gross Income (‘AGI’), for new & resale homes sited in LLLCommunities & on realty conveyed fee simple

• Official Industry Standard Chart of (operating) Accounts & the industry averages of Operating Expense Ratios (‘OER’s) for land lease lifestyle communities nationwide.

• Industry Briefing Sheet, contains core benchmark statistics for HUD – Code manufactured housing (e.g. shipment #s, $/sq.ft. costs), and land lease lifestyle community data from the current ALLEN REPORT, a.k.a. ‘Who’s Who Among LLLCommunity Portfolio Owners/operators Throughout North America!’

• Annual ALLEN REPORT, & 11 Signature Series Resource Documents (e.g. National Registry of Realty & Chattel Lenders; List of Freelance Consultants; and nine more…) available nowhere else in the MHIndustry or LLLCommunity asset class than from GFA Management, Inc., dba PMN Publishing.

All the above resources, but one, are available FREE for the asking, by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. The annual ALLEN REPORT is available ‘free’ to paid subscribers to the Allen Letter professional journal; or for $500.00 per copy; again, by phoning the above listed MHIndustry HOTLINE.

Back to the ‘Symptoms of Troubled Land Lease Lifestyle Communities’ It’s OK to ‘set your own standards’, or use ones provided in mathematical examples below. In each instance, however, think or say to oneself; This symptom, ____________, if ‘less or more’ than stated standard, indicates the subject property is ‘troubled’ in this particular area:

1. Physical Occupancy less than 93%, e.g. 186 occupied sites divided by 200 total rental homesites = 93% physical occupancy!

2. Economic Occupancy less than 85%, e.g. 170 ‘occupied & paid’ sites divided by 200 total rental homesites = 85% economic occupancy!

3. Bad debt more than 1% of adjusted gross rent! ‘Adjusted gross rent’ is total (monthly) rental income from a property, based on real or estimated physical occupancy percentage. So, if ‘adjusted gross rent’ is 200 sites X $200 X 95% (.95) occupancy = $38,000. X 1% (or .01) = $380.00. ‘maximum bad debt allowed’ benchmark.

4. Aged rent delinquencies more than 30 days! Some say 60+ days, however, when comparing ‘collection performance’ to conventional apartments, as it oft takes monthly rent from three homesites to equal rent volume from one apartment unit.

5. Aged accounts payable more than 30 days! Often beyond the control of on – site management, but a symptom, nonetheless, of a troubled property operation.

6. Operating cash flow goes negative in consecutive monthly periods! Similar to previous symptom, characterized by ‘holding checks’ till next month rent arrives.

7. Debt service coverage drops below 1.05x in consecutive months! This is margin by which a property’s ‘net operating income’ or NOI, exceeds or covers ‘debt service’ or mortgage payment, usually a10 – 20% margin, expressed as 1.1 – 1.2x

8. Moves by vendors & or suppliers to close property accounts, inhibiting work from being completed or needed supplies from being ordered and inventoried.

9. Poor curb appeal. Symptomatic of lax routine maintenance, deferred maintenance, lax rules enforcement, and marginal on – site property management.

10. Little to no qualified leasing or sales traffic, along with below average ‘conversion percentages’. Symptomatic of no marketing plan (Consider implementing the ‘5-Ps of Marketing’*3); ineffective advertising; lack of home sales & site leasing training; lax performance supervision (e.g. # of calls converted to visits, & # of visits converted to approved applications, & reporting of same); and, worsening reputation in the local housing market.

III.

Own LLLCommunities & Want to be Charter Member of MHCA?

The following two paragraphs are quoted from a letter I recently mailed to businessmen, still active in the manufactured housing industry and land lease lifestyle community asset class, who attended the historic, strategic planning meeting on 31 August 1993. This was precursor to formation of an Industry Steering Committee (‘ISC’), which in turn was predecessor to the Manufactured Housing Institute’s National Communities Council division – that debuted 1 January 1996.

“Since I’ve been unable to successfully market the ‘products & services’ created and nurtured, during the past 33 years, by the ‘for profit’ GFA Management, Inc., dba PMN Publishing firm, the matter comes down to two courses of action:

• I pull the plug on the ‘for profit’ firm, and walk away from the Research & Resource needs of hundreds of my fellow owners/operators of LLLCommunities nationwide and in Canada, and likely retire. Walking away is the least desirable alternative, but I would like to slow down and spend more time with Carolyn. What’s this mean (to you)? No more weekly blog postings and monthly newsletters, no more annual ALLEN REPORTs, no more annual Networking Roundtables or periodic FOCUS Groups, and no more monthly updates as to identities of real estate and chattel loan originators, freelance consultants, and much more. (Forgot to include: ‘no more exclusive data base, listing 500+/- LLLCommunity portfolio owners/operators in North America!’ & no more Manufactured Housing Manager® or MHM® professional property management training and certification program!’)

-OR-

• We take the above reference ‘for profit’ products and services, and roll them into a new, not for profit (501c3), national trade entity, to be the statistical Research & ‘comprehensive Resource servicing’ arm of the LLLCommunity property type, nationwide and in Canada. All the while, leaving Advocacy work for MHI’s NCC division. In effect, creating a second national MHIndustry (or third, considering MHARR) trade body, (something) we talked about avoiding, even at the 31 August 1993 meeting’ 19 ½ years ago!

So, where are we today? By years end, a call will likely go out to land lease lifestyle community owners/operators, who’ve already expressed their desire to have a direct roll in perpetuating the statistical Research & ‘comprehensive Resource servicing’ they’ve enjoyed these past three decades! Specifically, they’ll be given the opportunity to join and actively support the new, national, not for profit Manufactured Home Communities Association of North America®, or MHCA®, as a dues – paying charter member. Then participation will be opened up to all LLLCommunity owners/operators nationwide.

Know what? You don’t have to wait to get involved! Let me know NOW of your interest, via letter (GFA c/o Box # 47024, Indpls, IN. 46247), the above MHIndustry HOTLINE, or email: gfa7156@aol.com

Again, the new MHCA is envisioned as being the statistical Research (Until the Center for Manufactured Housing Studies, or CMHS, is fully operational) and ‘comprehensive Research servicing’ entity, going forward, to serve land lease lifestyle community owners/operators throughout North America; leaving the Advocacy interests, of the realty asset class, the sole focus of MHI’s National Communities Council division.

***
End Notes.

1. Read Development, Marketing & Operation of Manufactured Home Communities, Allen, Alley & Hicks, J. Wiley & Sons, NY, NY, 1994. See appendices B, C, and especially G.. Also, chapter # 2 in, Landlease Communities, Manufactured Home Communities, Mobile Home Parks, Trailer Courts & Camps, and Affordable Housing, George Allen, CPM® & MHM®, PMN Publishing, Indianapolis, IN., 2011.

2. Adapted from 6/2007 issue of Affordable Housing Finance magazine

3. 5 – Ps of Marketing: Product (or Service), Price structure, Place (or location), Promotion, & People! Source. Landlease Community Management, George Allen, CPM® & MHM®, PMN Publishing, Indianapolis, IN. 2008; 6th edition, pp. 66 & 67. Also text for Manufactured Housing Manager® or MHM® professional property management training and certification program, via PMN Publishing.

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

Blog # 222 Copyright 2012 2 December 2012

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

I.

WOW! Did YOU Respond? YES!

There will be a ‘by invitation only’ POWER Luncheon in KY on 1/23/2013

&

While the MHCA of North America is not a ‘done deal’ yet, may be soon…

II.

‘Past as Predictor of the Future – or just Another Crapshoot?

Have YOU Contacted ‘MHC of Arizona’ for a Copy of this MHExpose’?

III.

Key # Indicators of Land Lease Lifestyle Community Performance

IV.

Will I See YOU in Richmond, VA. this Coming Week?

***

I.

WOW! Did YOU Respond? YES!

There will be a ‘by invitation only’ POWER Luncheon in KY on 1/23/2013

&

While the MHCA of North America is not a ‘done deal’ yet, may be soon

More often than not, business writers wonder if what they pen is getting through to their intended audience? And assuming so, what’s their response to said message?

Well, last week’s blog produced many welcome and happy YES responses to the first question, as well as ‘replies of substance’ to the latter one! Within hours of posting the blog a day early (Saturday) on community-investor.com, I had six commitments – from land lease lifestyle community owners, to participate in the POWER Networking Luncheon on 23 January, the first day of the annual Louisville MHShow – along with an unsolicited offer to sponsor this first major networking and educational event of the year! And five days later, that ‘interested party’ number swelled to 20, not including the three discussion leaders I’ve asked to assist me facilitating this special event. Have YOU expressed your interest yet? Get your name on the ‘invite list’ ASAP, as seating is limited to 50 LLLCommunity owners and operators.

A sampling of the first dozen responses:

• “I’m interested in the luncheon. Count me in!” MM

• “Count me in for Louisville. I sincerely appreciate you taking the initiative (as expected and appreciated). We want to sponsor the event. This is NOT a request. What time and where?” RO

• “I would be interested in attending the meeting you mentioned, to be held in conjunction with the upcoming Louisville Show.” RN

• “I’ll be there for the Louisville networking lunch. Great idea!” CN

• “Would love to have lunch with you in Louisville.” DL

• “Haven’t been to Louisville in years, but sure plan to go now, for lunch and the show. Ha! Sounds a little like going to the big city for ‘dinner and a show’. DG

And that wasn’t all! Requests continue to arrive for a reprint of the ‘Best of Times, Worst of Times’, Briefing Summary I frequently share with inquirers, mostly from outside the MHIndustry & LLLCommunity asset class. Here’s what one of our blog ‘floggers’ (readers) had to say about the briefing summary:

“I read your piece on the current state of the industry and thought it was one of the most concise, accurate and realistic analysis I have read in awhile. With new MH production down, over the last decade, there are few used homes available for purchase as rentals. Your thoughts on this matter, particularly the economics of renting homes on – site?” JD

Haven’t decided for sure yet, but am considering editing this blog feature into a lead story for an upcoming issue of the Allen Letter professional journal, maybe the February 2013 issue. Speaking of the business newsletter, are YOU a paid subscriber? If so, look to receive the stunning 24th annual ALLEN REPORT (a.k.a. ‘Who’s Who Among Land Lease Lifestyle Community Portfolio Owners/operators Throughout North America!’) as a lagniappe (‘i.e. ‘freebie’) in the January 2013 issue. Otherwise the report alone, is retail priced at $500.00. per copy. So, if not yet a paid subscriber, and really want a copy of this new 24th edition of the ALLEN REPORT, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 ASAP. Price? Only #134.95 for a one year (12 monthly issues) subscription.

Why stunning? Because we’ve built a couple ‘extras’ into this year’s 24th edition. Not the least of which will be the List of the 25 Most Influential Persons in the MHIndustry & LLLCommunity Asset Class! Remember; many of you reading this blog are the ones who, during the past six months, identified the individuals YOU consider to be the Most Influential. You don’t want to miss this edition of the ALLEN REPORT.

And finally; regarding another topic imbedded in last week’s blog posting. MANY have phoned and written, asking for more information about the casually mentioned Manufactured Home Communities Association of North America, or MHCA for short. Here’s all I can tell you at this time:

If and when MHCA officially debuts, you’ll be among the first to know! And if indeed, maneuvered to materialize, MHCA will ‘hit the ground running, as a new, national, not for profit ‘comprehensive Resource servicing’ entity for all land lease lifestyle community owners/operators in the U.S. and Canada! As such, it’ll complement the Advocacy role of MHI’s National Communities Council (‘NCC’) division, and the eventual Research focus of the Center for Manufactured Housing Studies or CMHS.

While I said nothing last week about MHCA membership solicitation, more than a dozen of you, all LLLCommunity owners, inquired as to When, Where, How, & How Much it’ll cost to sign – on as Charter Members. While that’s getting out a little ahead of ourselves, it’s encouraging to know my land lease lifestyle community owner peers, as well as others, recognize the ongoing and intrinsic value of the print and online communication (e.g. books, monthly newsletters, weekly blog & standard PM forms), interpersonal networking events (e.g. annual Roundtable & periodic FOCUS Groups), professional property management education (e.g. nearly 1,000 Manufactured Housing Managers® or MHMs® to date), and realty deal – making opportunities, as well as other unique products and services. All this has been welcome confirmation of the past 33 years of effort, via GFA Management, Inc., dba PMN Publishing, in behalf of LLLCommunity owners and operators nationwide and in Canada. So, for the time being, a sincere ‘Thank You for that Vote of Confidence & Expectation of What’s Ahead!’ GFA

II.

‘Past as Predictor of the Future – or just Another Crapshoot?’

Have YOU Contacted ‘MHC of Arizona’ for a Copy of this MHExpose’?

As long time readers of the Allen Letter professional journal know; at least once each year, I update and share the most comprehensive ‘State of the MHIndustry & LLLCommunity Asset Class’ document available anywhere, from anyone, in the industry and throughout the property type. Sure, there are other versions of ‘State of the Manufactured Housing Industry’, but that’s generally all they’re about; that singular business type and model only. Few, if any, include key stats, trends, and more, that describe the land lease lifestyle community , a.k.a. manufactured home community.

With that said, you’ll surely want to read ‘Past as Predictor of the Future – or just Another Crapshoot?’ Why? Because I’ve taken material from the last dozen years of ‘State of the MHIndustry & LLLCommunity Asset Class’ presentations, and ‘predicted them forward’ to what we might expect, in both business milieus, a decade from now, during year 2022! Wouldn’t you like to know?

To order your copy of the MHC of Arizona newsletter containing this forward – looking document, contact Susan Brenton via (480) 345-4202 or sbrenton@azmhca.com The feature is tentatively scheduled to be published in the association’s January 2013 newsletter. It will not be reproduced in this weekly blog.

Here’re a few tidbits from this ‘futuristic start to year 2012 cum 2022:

• “One can almost (hope) to see an industry promo as straightforward as this: ‘One House, Your Home; Anywhere, Anytime! (Manufactured) Housing!’ Now all we’ve gotta do is figure out what word to use instead of ‘manufactured’….

• “This major segment of the manufactured housing industry is on the cusp of significant consolidation nationwide.” Which segment one do you think it is?

• “…how many more property portfolios are going to shrink in size, or disappear altogether, as foreclosure casualties?” That is indeed happening, you know.

• “Again, Randy Rowe, says it best: ‘Community owners (now) horizontally integrate, to include….” This part alone is a real education in LLLCommunity operations.

• “Household expenses must be paid by the homeowner/site lessee. If paid as part of the 30% HEF, a housing transaction is ‘affordable’; however, if paid in addition to the 30% HEF (PITI only), the housing deal is ‘risky’ at best!”

• “Today, more than ever before, (state) MHAssociations cannot afford expensive deadwood staffing. And…everyone must become active membership recruiters!”

• “But there’s a rub or two. The National Communities Council division of MHI has been effective since 1 January 1996, or 17 years. Two significant concerns spark controversy today and going forward.” Some ‘must read’ material for all..

OK, if you haven’t already contacted Susan Brenton, in AZ, to pre – order a copy of her association’s January 2013 newsletter, featuring this ‘look into our collective future’, phone her at (480) 345-4202 or email: sbrenton@azmhca

III.

Key # Indicators of Land Lease Lifestyle Community Performance

Just decided this particular blog posting is long enough as it stands, so will push this ‘really interesting & instructive material’ over into next week’s offering.

IV.

Will I See YOU in Richmond, VA., this Coming Week?

Sure hope so! If you’re a land lease lifestyle community owner/operator in any of the Mid Atlantic states, this’ll be the best $35.00 you’ll spend during 2012! Phone Tyler Craddock @ (804) 750-2500 or email him at tcraddock@vammha.org to register for this one day, 6 December, education and networking event. Learn all about 21st Mortgage’s cutting edge C.A.S.H. lending program for LLLCommunities; how to calculate ‘affordable’ & ‘risky’ Price Points for new and resale homes going into LLLCommunities or onto scattered building sites conveyed fee simple; my ‘trade secret’ property turnaround procedures, and much much more.

*****

George Allen, CPM®Emeritus, & MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

Blog # 221 Copyright 2012 25 November 2012

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

I.

Lunch Anyone?

1/23 in Louisville, KY: Dine & Network with Movers & Shakers!

II.

Fallout Continues!

Amazing! Little Official Action, but Lots of Support from You!

III.

Best of Times, Worst of Times…

What I Tell Prospective LLCommunity Investors When They Call

***

I.

Lunch Anyone?

1/23 in Louisville, KY: Dine & Network with Movers & Shakers!

Who’s up for starting a new tradition at the Louisville MHShow?

‘More than a few of you are’, since several manufactured housing and land lease lifestyle community businessmen and women have asked me – since the ‘free lunch is long gone at the Louisville MHShow’, Why don’t I host an annual ‘by invitation only’ luncheon and networking event, at a nearby hotel, for those who want to get off the showroom floor for awhile, to dine & socially mingle with ‘friends in the MHBusiness’?!

Well, I’m game, if You’re really interested! Tell you what we’ll do…

I’ll soon drive down to Louisville and reserve a venue. In the meantime, you indicate interest in being invited to the networking luncheon, by responding via phone (e.g. MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764) or email: gfa7156@aol.com
Simply state your desire to participate, leaving me your preferred contact information.
I’ll send you an invitation, & read future blog postings here for details, $ amount, etc..

So, what do we have in mind? An appropriately sized hotel meeting room, probably a buffet luncheon, with seating conducive to interpersonal networking; then a special speaker (not me), followed by opportunities for open discussion – or maybe three ‘directed discussions’ on such topics as lease option, financial regulatory compliance, and how to collect 100% of your site rent. And there’ll be no pressure to conclude the event. I suspect we’ll convene between 11 & 11:30AM, break bread together from11:30AM to 12:15PM, titillate you with the surprise presenter from 12:15 – 1PM (I do have someone in mind.) And you’ll be free to return to the MHShow anytime you wish: before or after 1PM, or later – if you participate in one or more of the three directed discussions described above. In any event, I plan to keep the meeting room available for networking, discussion, and more, until at least 3PM. Cost? Too early to say, but as reasonable a fee as I can negotiate with the host facility.

Wanna participate? You’ll need an ‘invite’; and the first step to receiving that, is to phone the above – listed MHIndustry HOTLINE or email me via gfa7156@aol.com

***

A Postscript of Virginia Sorts…

Speaking of networking, as well as education and industry/asset class matters! Don’t forget. If you own and or fee manage one or more land lease lifestyle communities in VA, MD, NC, WV, and surrounding areas, plan to be in Richmond, VA., on 6 December 2012! Why? The Virginia Manufactured & Modular Housing Association is hosting a day long opportunity for Education (‘How to Set Affordable & Risky Price Points on New & Resale Homes’ & ‘How to Turnaround Troubled & or Abused Properties!’), Information (‘State of the MHIndustry & LLLCommunity Asset Class!’ & 21st Mortgage’s cutting edge C.A.S.H. Program, funding on – site home loans in partnership with LLLCommunity owners!), and superb interpersonal networking (luncheon) among land lease lifestyle community owners/operators. Tyler Craddock, VAMMHA’s exec, is your point of contact for more information and to register (only $35.00/person!): (804) 750-2500. Hope to see you there!

***

II.

Fallout Continues!

Amazing! Little Official Action, but Lots of Support from You!

Haven’t said much yet, about what happened at the NCC meeting on 8 October 2012, during MHI’s annual meeting in San Antonio, TX. Suffice it to say however, an unexpected, unfortunate public incident occurred that begs redress for the injured parties.

As of 21 November, MHI’s Executive Committee attempted, by email, to dodge responsibility for said incident, even though it occurred at their annual meeting venue; suggesting offended MHI members take the matter up with the NCC division officer effecting the highly embarrassing incident.

With that said, know nary a week goes by – and there’s been seven of them so far, when we haven’t heard from one or another land lease lifestyle community ‘owner’, assuring us of their ongoing support. Here’s the most recent email commentary and challenge to come our way:

“A long time ago, I got sick of the ‘do nothing clique’, who are ONLY in the mix for their own selfish reasons. Why invest personal money, and more importantly TIME (to this end). Keep up your tenacious fight, and continue to be our voice! Help to crystallize the issues, and support people who can really help make a difference.” JR (Emphasis added. GFA)

Where does this sorry matter stand today? Correspondence continues to pass back and forth among the elected and salaried leaders of our industry’s primary national Advocacy body, and the injured parties. I’m hoping there’ll be resolution by the end of November, certainly by 8 December, which will mark two full months of waiting for this situation to be made right. Beyond that? Well, guess you’ll need to read this blog posting, from week to week; as well as upcoming issues of the Allen Letter professional journal; and, certainly plan to be at the next NCC meeting in Arlington, VA., on 26 February 2013.

***

Best of Times, Worst of Times…

What I Tell Prospective LLCommunity Investors When They Call

By now, most of you reading this 221st consecutive weekly blog posting, know I make my living as an independent, freelance consultant to the factory – built housing industry, land lease lifestyle community owners/operators, and affordable housing purists and enthusiasts nationwide. As such, we field a wide variety of task inquiries every week, including: deposition and jury trial testimony in expert witness cases; telephonic & on – site inspection Mystery Shopping assignments throughout the U.S.; covert property management criminal investigations; property takeover & turnaround planning services; public, private & corporate speaking engagements; as well as, professional property management (Manufactured Housing Manager® or MHM®) training & certification class scheduling – and more.

The one near routine inquiry these days, for ‘private industry & realty asset class briefings’, comes from financiers, equity funds, Wall Street analysts, hedge fund directors, lending institutions, academics, and now, realty – secured mortgage servicing firms, all asking the same or similar questions:

Is now the right time to invest in manufactured housing & or land lease lifestyle communities? If so, why? And if not, why not?

To begin with, those are not generally the two ‘trade terms’ inquiring clients use in their question or questions. But their choice of lingo is usually a clear indication as to how little or much they already know about our interrelated business types and models. What’s contained in the following paragraphs, albeit in abbreviated fashion, is what I shared with a paying client this past week; and frankly, the ‘drill’ doesn’t change much from client to client, or month to month, unless new information or helpful statistics become available for my use. Ready?

I won’t tell you ‘up front’, whether this is the Best of Times, or the Worst of Times, to invest in manufactured housing and its’ real estate component, the land lease lifestyle community (a.k.a manufactured home community). But you’ll be able to make up your own mind, by the time we’ve worked through the following paragraphs, and you’ve studied the 23rd annual ALLEN REPORT, as well as other contemporary trade articles. The 24th annual ALLEN REPORT will be published 1 January 2013 as a lagniappe to the Allen Letter professional journal.

To begin with, ‘manufactured housing’ and ‘land lease lifestyle communities’ (a.k.a. LLLCommunities) are two different, but closely related business types and models. HUD – Code manufactured housing, on the one hand, has to do with the design, fabrication, shipment, and installation of factory – built housing constructed in accords with a federal preemptive performance – based building code. Manufactured housing production, marketing health, and industry performance are measured by ‘annual shipment volume’ of new HUD – Code homes. At present, and for the past several years, annual shipments have been at an historic and dismal nadir of only 50,000+/- new homes per year, down from a renascence high of 372,843 new HUD – Code new homes shipped during 1998. No significant change, or improvement, is seen on the horizon – unless there’s an increase in crew housing demand from natural oil – fracking regions of the U.S.; or FEMA needs thousands of specially – designed homes, following natural and weather disasters. Of course, a wholesale return of the now decade – long – gone accessible chattel (personal property) financing of HUD – Code homes would also be a major game changer!

LLLCommunities are neither growing or declining in number. It’s estimated there are 50,000+/- of them nationwide, with 85 percent of that number characterized by properties containing 100 or fewer rental homesites apiece. Because of their scarcity (i.e. 50,000+/-), stable occupancy (homes too large & expensive to relocate), stable & competitive site rent (compared to conventional apartments in the same local housing market), affordable home ownership & equity opportunity, being ‘recession proof’, and unique opportunities to ‘add value’ in difficult economic times, these income – producing properties enjoy the near perennial reputation of being a Sellers’ Market. It’s, in large part, why the majority of the 15 percent of LLLCommunities, larger than 100 rental homesites apiece, are today in 500+/- known property portfolios domiciled throughout North America only. For more details read the 23rd & 24th annual ALLEN REPORTs.

With all that said, what are the unique, encouraging, even troubling trends characteristic of many, if not most or all LLLCommunities across the U.S. today?

Traditionally, when one acquired a LLLCommunity, it was commonplace to rely on local independent ‘street’ MHRetailers (formerly referred to as ‘street dealers’) to sell new and resale manufactured homes, then encourage buyers to site their new home in (then) mobile home parks cum manufactured home communities. Well, due to a plethora of undisciplined lending practices, throughout all segments of the manufactured housing industry before, during, and after the ‘turn of the century’ (i.e. 1996 – 2005), most independent sources of chattel (personal property) finance have disappeared from our industry and are remain gone. Same with the MHRetailers; their number is estimated to have plummeted from 11,500, at the turn of the century, to but 4,000 independent ‘street’ MHRetailers & ‘company stores’ today. And no near term relief or change is foreseen there as well.

At that point in time – when independent, third party – originated chattel mortgage financing disappeared from the manufactured housing business scene, owners/operators of LLLCommunities, from coast – to – coast, exercised one of the aforementioned unique characteristics of this property type, i.e. ‘ability to create additional streams of income’ by selling and self – financing new and resale home transactions on – site! This worked fine for awhile – until getting (some say, unintentionally) swept up in financial reforms, following our nation’s recent economic hiatus, specifically, the S.A.F.E. Act (Safe And Fair Enforcement of Mortgage Licensing), provisions of Dodd – Frank legislation, Red Flag, American Patriot Act, AML, and more. Now $$$ matters have become much more complicated; enough so, many LLLCommunity owners, like me, when needing to fill vacant rental homesites, opt to buy resale homes (Some buy new homes), then lease them as ‘rental units’ on – site, rather than ago through the complicated and inherently dangerous hoops of becoming and remaining compliant with onerous state and federal $$$ regulations. Speaking of ‘new homes’, know that one area where HUD – Code home manufacturers work closely with LLLCommunity owners/operators, is in the area of designing, building and shipping Community Series Homes, a.k.a. CSH Models. These are generally modest size singlesection homes or smaller multisection homes, often featuring front porches, but almost always characterized by durability – enhancing features, to prolong the home’s utility and life as it passes among multiple homeowners/site lessees and unit renters.

Another dynamic that’s been playing out, during the past decade, is the shake out of properties, sometimes even entire LLLCommunity portfolios, where owner/operators, in an attempt – I suppose – to emulate the real estate investment trusts (‘REIT’s) in this asset class, ‘raised site rents too much too fast’, to maximize profitability during the Go Go economic times, roughly between 1998 and 2008. The inevitable consequence was, as ‘rents went up’ (in effect stealing value from homes sited in affected properties), we turned our customers ‘upside down’ in their transactions. They then, ‘voted en masse, with their feet’, becoming ‘no money down’ buyers of new, cheaply constructed tract homes (which included underlying realty in the transaction) financed via undisciplined lending practices akin to what cost the manufactured housing industry their sources of capital just a few years earlier! Then that site – built home finance bubble burst.

Now today, many of these LLLCommunities, large and small, whose rental homesite rents rose to ‘double or more’ what local housing markets indicated, or could bear, have become tied up in forbearance agreements, and most recently – back on the market, as foreclosure deals. So properties are indeed available for purchase; it’s just that, in many cases, one must craft a viable turnaround Management Action Plan or MAP, that effectively deals with curb appeal issues, deferred maintenance, filling vacant rental homesites (marketing), collecting delinquent site rent, and adjusting rental rates – all at the same time, or in tight sequence. And there’s this strategic question; ‘Where will the funds come from, to purchase new and resale homes to then be either resold and self – financed (e.g. via lease option or one or another type of ‘captive finance’*1), or leased as on – site apartment units?’

The intent here, has not been to ‘scare you off’ the asset class as an investment vehicle, but to deliver a healthy dose of contemporary reality, before you begin a serious search for the ‘right property’ in the ‘right location’, at the ‘right time’, and for the ‘right price’, that meets your investment needs and goals. *2 There are additional resources to access, as you continue your research and decision – making. They include:

• Manufactured Housing Institute’s (‘MHI’) National Communities Council (‘NCC’) division; the national Advocate for land lease lifestyle communities nationwide: (703) 558-0678

• Center for Manufactured Housing Studies or CMHS, the new, academic Research arm, for manufactured housing, land lease lifestyle communities, and affordable housing nationwide. Calls temporarily being taken and forwarded, via the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

• Manufactured Housing Communities Association of North America or MHCA, maybe the new ‘comprehensive Resource servicing’ arm for land lease lifestyle communities throughout North America. Phone the MHIndustry HOTLINE: (988) MFD-HSNG or 633-4764.

End Notes.

1. For lease option information, contact Spencer Roane, MHM® via spencer@roane.com And for ‘captive finance’ alternatives information, and training relative to being compliant with finance regulations, contact Ken Rishel via (217) 971-3968.

2. For further information on the land lease lifestyle community, as investment vehicle, read: How to Find, Buy, Manage & Sell a Manufactured Home Community ($75.00) & Landlease Communities, Manufactured Home Communities, Mobile Home Parks, Trailer Courts & Camps, and Affordable Housing ($19.95). Both books available from PMN Publishing. Order via MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 or visit community-investor.com

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247 (317) 336-7156

Blog # 220 Copyright 2012 18 November 2012

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

I.

Getting Ready for the 24th annual ALLEN REPORT, a.k.a.
‘Who’s Who Among LLLCommunity Portfolios in North America

II.

Trade Secrets to be Revealed During Virginia’s First Symposium;
A special day for land lease lifestyle community owners/operators

III.

The Future (out to year 2022) of the Manufactured Housing Industry & the Land Lease Lifestyle Community Asset Class!

***

I.

Getting Ready for the 24th annual ALLEN REPORT, a.k.a.
‘Who’s Who Among LLLCommunity Portfolios in North America

If you are reading this blog posting and own, fee manage, or otherwise operate one or more land lease lifestyle communities, the annual ALLEN REPORT is likely required reading for one of two reasons: you own such properties and use the helpful information contained therein, to position your LLLCommunities to achieve greater profitability and value; or, you’re a salaried professional property manager, or freelance management consultant, and know this is the only published document containing the names of 20 percent of the known 500+/- portfolio owners/operators in business today throughout North America.

For the past 23 years, the ALLEN REPORT has been the sole researcher and purveyor of benchmark statistical data and trade knowledge pertaining to this unique, income – producing property type, in the U.S. and Canada! Not only is it a veritable ‘Who’s Who’ of investors and professional property management firms active in this realty asset class, but every year includes special features available nowhere else:

• List and comparison of 13 unique LLLCommunity characteristics in years 2000, 2010, & 2020! A list first compiled by the ULI’s Manufactured Housing Communities Council in 2009, and featured in the 23rd annual ALLEN REPORT.

• ‘Seven reasons’ LLLCommunities enjoy a near perennial ‘sellers market’ as a commercial real estate investment. This list is now codified in Landlease Communities, Manufactured Home Communities, Mobile Home Parks, Trailer Courts & Camps, and Affordable Housing, PMN Publishing, IN. 2011.

• Setting ‘affordable’ & ‘risky’ Price Points on new and resale manufactured homes to be sited in LLLCommunities, or on private sites conveyed fee simple, using Area Median Income (‘AMI’) &/or Annual Gross Income (‘AGI’) and the ‘Ah Ha! & Uh Oh! Worksheet’. Now available in the Book of Formulae, Rules of Thumb & Helpful Measures for manufactured housing, LLLCommunities, real estate investors, affordable housing aficionados, & realty mortgage originators. PMN Publishing, via MHIndustry HOTLINE: (877)MFD-HSNG or 633-4764.

• ‘Rental Homesite Counts Among All Land Lease Lifestyle Community Real Estate Investment Trusts (‘REIT’s) from 1994 through 2012’. Question: How many LLLCommunity REITs have there been since 1994? Hint. More than three and less than 10. Read the 24th annual ALLEN REPORT for this & much more!

It’s almost ‘too late’ for owners/operators of LLLCommunity property portfolios to submit rental homesite count data for inclusion in this year’s report, but it’s worth a try. Phone the above referenced MHIndustry HOTLINE and tell me, or leave a message.

And while you’re at it, tell me who YOU think is the single most influential person in the MHIndustry and or LLLCommunity asset class! As we announced a few months ago, a ‘List of the Top 25 Most Influential Individuals in the MHIndustry & LLLCommunity Asset Class’ debuts in this year’s 24th annual ALLEN REPORT. Use MHIndustry HOTLINE to make your recommendation. We have more than 20 on hand and nominees don’t have to be members of national MHTrade or Advocacy bodies!

OK, so how does one obtain a copy of the 24th annual ALLEN REPORT? The retail price for the report, when requested by Wall Street analysts, hedge fund managers, university and business libraries, and would be real estate investors, is $500.00 per copy – along with one or another of the dozen Signature Series Resource Documents (e.g. 14th annual Registry of Real Estate & Chattel Finance Lenders in the MHIndustry & LLLCommunity Asset Class’) we research, update and publish every month of the year.

However, for ‘insiders’, specifically MHIndustry businessmen and women, along with LLLCommunity owners/operators, the annual ALLEN REPORT is FREE to subscribers to the Allen Letter professional journal! For $134.95/year, you receive an Allen Letter each month of the year, usually chock full of lagniappes (Free enclosures, e.g. recent summary of the ‘biggest & best networking roundtable ever’, and much more!), and ALLEN REPORT, specifically, with the January issue. SO, if not already a newsletter subscriber, simply phone the MHIndustry HOTLINE and sign – up today.

II.

Trade Secrets to be Revealed During Virginia’s First Symposium; A special day for land lease lifestyle community owners/operators

If you’re reading this blog posting, and own/operate one or more land lease lifestyle communities in Virginia, Maryland, West Virginia, or North Carolina – and elsewhere, you should consider spending the day in Richmond, VA., on Thursday, 6 December, a scant two weeks away. I’ll certainly be there for the day, and hope to see you there as well!

Why attend? Because Virginia Manufactured & Modular Housing Association (‘VAMMHA’) executive director Tyler Craddock, has cobbled together one terrific day of education, information sharing, interpersonal networking, and chattel finance sourcing for land lease lifestyle community owners and operators.

• Education? Two of the hottest topics, nationwide in this realty asset class today, are ‘How to Set Affordable & Risky Price Points on New & Resale Homes Today – particularly for those in LLLCommunities; and, How to Turnaround Troubled and or Abused Properties! (Latter topic is where ‘trade secrets’ come into play!)

• Information Sharing? Two things you’ve gotta experience! In the first instance, the State of the MHIndustry & LLLCommunity Asset Class presentation you’ll hear, is unparalleled at any other venue in the U.S. these days. Why? Because no one else covers what’s happening throughout the LLLCommunity asset class! And Tyler will brief participants about what’s happening legislatively in Virginia.

• Interpersonal Networking? When was the last time LLLCommunity owners/operators from the above – listed states have gotten together for a joint symposium like this? Maybe NEVER? Don’t miss this historic opportunity to attend a SECO – like event (Recalling the very successful 140 LLLCommunity participant symposium in Atlanta, GA. earlier this year) right in your own back yard! Seating is limited, so don’t risk not being able to attend.

• Personal property (chattel) financing? If you’re marketing homes For Sale and engaging in self – financing on – site (e.g. ‘captive finance’, lease option, etc.) and haven’t learned firsthand of 21st Mortgage Company’s cutting edge C.A.S.H. Program, this reason alone is worth participating in this one day event in Richmond on 6 December 2012.

For more information, and to register @ $35.00/person, contact Tyler Craddock via (804) 750-2500 or tcraddock@vammha.org for meeting location address (Home Building Association of Virginia’s facility) and host hotel (Hampton Inn) information. Remember; seating is limited, so don’t risk missing this near – historic event for VA, WV, NC, & MD owners/operators of land lease lifestyle communities. Should be a Good Day for All!

***

III.

The Future (out to year 2022) of the Manufactured Housing Industry & the Land Lease Lifestyle Community Asset Class!

Do you like being among the first businessmen and women to learn of inside ‘goings on’, relative to the manufactured housing industry and land lease lifestyle community asset class? Well, so do dozens of other MHExecutives around the U.S. and Canada. And they satisfy that need by reading an exclusive monthly newsletter known as the Allen CONFIDENTIAL! This savvy communiqué has been around for a dozen years, but is rarely shared in public. And it’s not inexpensive. An annual subscription is $950.00/year for 12 monthly issues; but only $750.00/year for subscribers to the Allen Letter professional journal. To subscribe, use the aforementioned MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

Now here’s an interesting ‘bottom line’ figure for you. All three items mentioned in this blog posting, two newsletters and the annual ALLEN REPORT, ordered and paid for separately cost $1,584.95; but, bundled together, only $884.95; a savings of $700.00! So, are you missing out? Take that first step to being fully informed TODAY!

Back to that titillating title of Part III of this week’s blog posting at community-investor.com.

Awhile back I was asked by Susan Brenton, executive director of the Manufactured Home Communities of Arizona association, to research and pen a forward – looking feature article for her group’s monthly publication. Well, I’m still putting the final factual details and prognostications together, fleshing out what I’ve tentatively titled:

‘Past as Predictor of the Future – or Just Another Crapshoot?

Here are a couple interesting questions answered in the first part (i.e. past and present time frames) of the feature: What were two cynical and foretelling industry – wide slogans commonly used and heard during years 2002 & 2003? And the well known MHIndustry businessman, who accurately foretold the near total financial collapse of site – built housing a half dozen years before it happened? Too bad the right people didn’t listen to him!

Now, switching to the future. What changes in the manufacturing segment of the MHIndustry will likely be necessary (In addition to the return of chattel financing) for it to return to the Glory Days of new home shipment volume (There’s a hint, right there!)? And how ‘bout the independent ‘street’ MHRetailers, and their ‘company store’ counterparts? What’s the future maybe hold for them? And let’s not forget the land lease lifestyle community segment. Sure is a mixed – bag of successes and failures today, but what’s it going to take to see increased physical and economic occupancy during the years ahead, where national Advocacy, performance Research, and ‘comprehensive Resource servicing’ are concerned – and more!? (This might just turn out to be some of the most important business reading, for you, during all of year 2012; Oops, 2013). The two finance segments of MHIndustry & LLLCommunity asset class? Their intertwined or mutually exclusive future? Guess you’ll have to read the details in the Arizona – commissioned feature.

Unless you’re presently a dues – paying member of the MMC of A, you’ll have to get in touch with Susan Brenton, to order and or obtain a copy of the January 2013 publication that’ll feature this ‘ten year look into the future of our industry and asset class’. Contact her via (480) 345-4202 or sbrenton@azmhca.com

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

Blog # 219 Copyright 2012 11 November 2012

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

I.

Talking to One Another About Ourselves & Our Business Model..

II.

‘Selling New Homes’ at 2013 MHCongress in Las Vegas in April!

III.

More on ‘that book’ I’ve Been Telling You About for Weeks….

***

I.

Talking to One Another About Ourselves & Our Business Model..

“Bottom line. You can’t sell (manufactured) housing for half price without a fair bit of compromise. Increase your (home sale) price ten percent and you’re toast. It’s competition that brings prices down, and it’s price that moves the goods. The magic of manufactured housing has long been, and apparently still is, the ability to build decent housing at costs nobody else can touch, and make good profits along the way. Invest every nickel of profit in upgrading the product, and you gain a five percent advantage. But of course, you go out of business. It’s a brutal world out there George. We have to find a way to improve the quality of our golden eggs without killing the goose!” RV (Lightly edited. GFA)

There’s a significant measure of truth in the previous paragraph. To this day, it boggles my mind, when walking into an attractive, brand new HUD – Code manufactured home, to experience the eclectic right mix of ‘bells & whistles’, e.g. laminated flooring instead of carpeting in some rooms; heavy gauge recessed flap hinges on all doors, instead of thin gauge surface hinges; and more. But then, to observe dozens of cheap white plastic switch and outlet covers at every light switch and electric outlet in the house; and doors hung ‘inches off the floor’ to facilitate return air flow to the heater/air conditioner, rather than enhancing privacy via installation of air vents near the bottom of passage doors hung nearly flush with the floor; and more.

Is there an answer to this perennial quality – price conundrum? I think so, and not; the answer being in the form of this question: ‘When was the last time you heard or saw HUD – Code home manufacturers caucus and cooperate with one another to this end?’ Answer: Almost never. Why? Competition. Oh, innovative ideas have been tried ‘over the years’ (Think back to aluminum wiring, culturally sensitive exterior designs for urban infill, etc.), but we still lack the will to meet and work together towards a common solution – with one notable exception, the National State of the Asset Class (‘NSAC’) caucus, 27 February 2009 in Elkhart, IN. That was when 100 reps from the manufacturing and land lease lifestyle community segments of the manufactured housing industry caucused to figure out ‘How to Sell More New Manufactured Homes into Land Lease Lifestyle Communities?!’ Results? The Community Series Homes, or CSH Models, relatively common today, with many featuring front end loaded porches, and durability – enhancing features needed to ensure habitability over an extended period of time. Perhaps now it’s time, once again, for HUD – Code home businessmen and women to look past their competitive nature, to solve the quality – price golden egg conundrum, without killing the goose that manufacturers them!

So, here’re two Questions of the Hour, Day, Month and for the Year 2013: If YOU agree there should be a soon national caucus, call it a MHInitiative® *1, to address this perennial, and as yet unsolved, manufactured housing industry conundrum, WHO should and will step forward to lead, plan, organize, and facilitate this timely, strategic effort in behalf of HUD – Code home manufacturers nationwide? I’ll be pleased to help if asked; but rather than being the catalyst and meeting planner this time around, the organizing and executing of such a MHInitiative® should rightly come from the manufacturing segment of the manufactured housing industry! And know what? There isn’t a more appropriate time and opportunity for elected and salaried leaders of MHI and MHARR to come together, for the good of the entire industry, than auspicious occasion!

Now, let’s wait to hear and see what happens, or doesn’t happen regarding this challenge, between now – mid November, and the end of year 2012. This could be the HUD – Code manufactured housing industry’s 60 year bellwhether event! *2

End Notes:

1. MHInitiative® is the term that’s replaced National State of the Asset Class (‘NSAC’) caucus, used to effectively in Tampa, FL., @ 2/27/2008, and a year later in Elkhart, IN., @ 2/27/2009. A hint, for anyone who’s read this challenge thus far; 2/27/2013 might be a possibility, as MHI’s annual Legislative Conference, in Arlington, VA., ends, and just before the Great Southwestern Manufactured Housing Show begins in Tulsa, OK. Or, the MHInitiative® might be an appropriate sidebar event to the 2013 Manufactured Housing Congress in Las Vegas, 16 – 18 April.
2. Bellwhether ‘a person or thing that assumes leadership., a person or thing that indicates a trend.’ And does the manufactured housing industry need a unifying bellwhether leader and bellwhether trend at this point in its’ history!

II.

‘Selling More Homes’ at 2013 MHCongress in Las Vegas, NV.

Switching our focus to market research. Here’s what another industry observer has to say about that subject and manufactured housing. “The vehicle industry, from which our industry evolved, spends multiple millions (of dollars) researching who their potential customers are, and what it will take to make them customers, while manufactured housing spends almost nothing; relying instead on borrowed site – built housing research and gut instinct. What is wrong with our industry, that this basic (research) function goes unmet? George Allen is the closest we have to a research arm, with his community – oriented publications, and ongoing efforts to get an Ivy League university actively and permanently involved in (‘teaching us how to effect and share’) manufactured housing and land lease lifestyle community market research.” KR (Again, lightly edited. GFA)

As mentioned in the last paragraph of Part I of this blog posting, ‘How to Sell More New Manufactured Homes into Land Lease Lifestyle Communities?!’ will be a primary focus during year 2013. Yes, it’s early in the (business) game – like five months early, to be writing and talking about one of the key topics to be covered at the Manufactured Housing Institute’s annual Manufactured Housing Congress in Las Vegas, 16 – 18 April. But guess what; it’s going to take those five months to get this alert out, and the training material prepared, for HUD Code home manufacturers and land lease lifestyle community owners/operators wanting to cultivate this emerging market. It’s simply a shame though, that MH – focused ‘market research’ is not an integral part of our industry’s package – yet.

So, here’s where the matter stands today, and what’s expected to materialize during the next five months, as the MHCongress approaches. During August, a blog posting, at this web site, introduced a Ten Point Plan to help HUD – Code home manufacturers ‘Sell More New Manufactured Homes into Land Lease Lifestyle Communities!’ Since then, copies of the Ten Point Plan have been mailed to every HUD Code home manufacturer in the U.S., and it was published in the September issue of the Allen Letter professional journal. This same Ten Point Plan will serve as the core of the program being prepared for public presentation at MHI’s annual MHCongress in Las Vegas.

In the meantime, it’s hoped at least one HUD – Code home manufacturer takes ‘point number ten’ seriously, to wit: #10. ‘Want to corner the on – site new home sales in land lease lifestyle community market? Research, write, publish and distribute, for a price or for free, the MHIndustry’s first HOW TO guidebook on this subject! Seriously. No one has done so to date. Be the first to do so, and watch LLLCommunity folk beat a path to your plant door, when you teach them how to properly select, fairly price, skillfully market, and effectively sell ‘your homes’ on – site at their properties!’ I’ve personally challenged Business Development Managers, or BDMs, at each of the Big Three ‘C’ manufactured housing firms (Clatyon, Cavco, & Champion) TO DO SO, but still await a manuscript! Even volunteered to provide all the self – publishing services (e.g. editing, printing, binding, distribution) needed, to pull this project off successfully. Anyone listening out there?

Proof of the validity of this #10 point? 25 years ago, I authored and self – published Mobile Home Park Management. Today, with tens of thousands of copies sold, it’s been retitled twice, and now is Land Lease Lifestyle Community Management. In its’ eighth edition, this is the core textbook for the Manufactured Housing Manager® or MHM® professional property management certification program.*3 And know what? The same could well be the case now – and 25 years from now, for whoever pens and publishes the first and best ‘How to Sell More New Manufactured Homes into Land Lease Lifestyle Communities!’ guide or text. I’m not qualified to author it or I would….

Bottom line? See YOU in Las Vegas at the MHCongress, when we will learn together, ‘How to Sell More New Manufactured Homes into Land Lease Lifestyle Communities!’

End Note.

1. To order a copy of Land Lease Lifestyle Community Management, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. If interested, also ask for information on the Manufactured Housing Manager® or MHM® program. A one day class is scheduled in Tulsa, OK., during late August 2013.

III.

More on ‘that book’ I’ve Been Telling You About for Weeks….

As you’re reading this weekly blog posting at community-investor.com, know that author Bob Vahsholtz is diligently working, somewhere in the U.S., diligently researching, carefully compiling, and skillfully writing the first definitive book on factory – built housing in general, manufactured and modular housing in particular. When this tome is completed, hopefully during 2013, it’ll be the first such book in more than two decades!

In the meantime, if after reading the following list of chapter headings and subtopics, you’d like to provide input, in the way of ideas, suggestions, material, etc., to the author, send it to me via GFA c/o Box # 47024, Indianapolis, IN. 46247 or FAX it to (317) 346-7158. Any questions, contact me via the aforementioned MHIndustry HOTLINE.

Here’re the chapter headings and subtopics Bob V is working with at this time:

1. There’s Always a Better Way. Stick – built housing, the ailing beast? America, the nation of shortcuts to success, and more….

2. Leadership & Innovation. The risks of pioneering. Introducing Richardson’s.

3. Introduction to the Learning Curve. Theory; how it works in the real world. Classic example of the Model T Ford.

4. Niche Markets, the Way into the Battle. Using Detroit as an example; introduction to Midget Motors.

5. The Biggest Market in the World; Housing. Size of the challenge? And bureaucracy, the ultimate stranger (or maybe ‘strangler’) of progress.

6. Big Guns Step into the Fray. An introduction to Sears, Levitt, National Homes, and Lustron.

7. The Elephant in the Room. Code challenges to innovation, barrier of cultural momentum, and more….

8. Manufacturers Climb the Blind Side. Origins of the MHIndustry; the story of Schult Homes.

9. The Support System. Suppliers, dealers (Wish he’s say MHRetailers), parks (Wish he’d say communities), lots (Wish he’d say rental homesites or sites), and installation ‘foundations’, the origin of the industry’s stigma?

10. How to Cut Housing Cost in Half. Fundamentals of MH efficiency, comparison with stick – building costs, matters of quality and more….

11. Leadership & Management. Art Decio builds a learning curve; the Skyline experience.

12. Managing in Troubled Times. Think Gold Seal, ANSI, and early codes; then the HUD code, along with government ambiguity.

13. How Much Can One Leader Do? Norcom & Canada; federal industries, and more

14. Manufactured Housing Hits the Wall. Who’s in charge of MH strategy? Lack of overview. Role of government, MH & long term finance. Land Lease Lifestyle Communities, a financing niche.

15. A Way Through the Woods? The Clayton story, park models, mobes redux, sectionals, etc. The Cavco story.

16. Getting Serious about the Opportunities Ahead. Riding a focused learning curve; risks vs. gambles – and a big difference. Role of team building….

Well, there you have it. Your advance peek at a text that will describe and parse parts and much of your business livelihood. David Funk, MHM, and I are working closely with Bob V, introducing him to key personages and firms throughout the manufactured housing business. Feel free to contact either of us if you have questions and comments.

***

George Allen, CPM®Emeritus, MHM®Master
Box # 47024, Indianapolis, In. 46247
(3170 346-7156 or gfa7156@aol.com

Blog # 218 Copyright 2012 4 November 2012

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

I.

WARNING! Land Lease Lifestyle Community Owners/operators
Beware of Faux Management Consultants!

II.

More Differences Between Small & Large Owners/operators of
Land Lease Lifestyle Communities….

III.

Initial Blog Reader Responses to ‘A Lesson in Growing & Caring for One’s Reputation’, from Management 101, for Land Lease lifestyle Community Owners, Property Management Executives,
Regional & On – site Managers & Others!

***

I.

WARNING! Land Lease Lifestyle Community Owners/operators
Beware of Faux Management Consultants!

They’ve resurfaced again. Sometimes they’re unemployed land lease lifestyle community on – site and regional managers looking for work, other times interlopers from other segments of the manufactured housing industry, even other income – producing property types. Irregardless, they hang out their shingle as independent, freelance management consultants, oft promising to quickly fill vacant rental homesites; trim operating expenses; in effect, maybe executing the turnaround or rehabilitation of an ailing or management – abused, income – producing property. A desirable end game, for sure; just be fully aware of to whom one is entrusting this multi million dollar real estate investment! More later….

This phenomena pops up every ten or so years, as the LLLCommunity realty asset class suffers through the ‘down stage’ of an economic life cycle. For example; we saw this in the late 1970s, as the manufactured housing industry adjusted to HUD’s new performance – based national building code (Causing new ‘mobile home’ shipments to plummet from 575,940 in 1972 to 250,000+/- by the end of the decade), initially resulting in tens of thousands of newly constructed ‘mobile home parks’ going into foreclosure as the historically heavy flow of new homes dried up.

We saw a similar, though not as massive adjustment in the late 1980s, after the Federal Tax Code was changed in 1986, forcing limited partnership syndicators to market the ‘profitability’ of their deals, rather than ‘tax losses’ heretofore. That raft of freelance consultants had their work cut out for them, as they were forced to implement basic principles of professional real estate management to salvage and then rebuild profitability. That time around, compared to the decade before, it was easy to spot the charlatans, as they were forced to quickly produce positive results or quickly move on.

A decade later, at the end of the 1990s, following a second REIT wave (mid – 1990s), LLLCommunity income – producing properties as a whole, enjoyed – albeit only for a brief period of time – the statistical and historical acme (highest point) of national rental homesite physical occupancy, at 95 percent! And if we needed any independent consultancy advice at the time – which we did not get, it should have been as a loud and stern Warning, to stop going down the slippery slope of predatory (chattel) lending that had taken the manufactured housing industry by storm! And we’re still paying for that misguided era of greed, more than a decade later.

Now it’s 2012, about to morph into year 2013. This time around, thousands of LLLCommunities have slipped into foreclosure, or are approaching that unfortunate destiny, as physical and economic occupancy (Do you understand the critical difference? See *1), for the most part, continues to decline in local housing market after local housing market – but with some notable exceptions. While some of the general occupancy decline is driven by tenant relocation, and near disappearance of independent ‘street’ MHRetailers, as well as many ‘company stores’, from most markets (i.e. The manufactured housing industry’s traditional ‘fillers’ of vacant rental homesites), most of the asset class’ stress comes from a lack of ability to obtain chattel (personal property) financing for new and used homes sold on – site. And with the exception of the innovative C.A.S.H. Program available from the 21st Mortgage Company (Lance Hull @ (800) 955-0021), not much improvement to this situation is anticipated anytime in the near future.

Now here’s where the WARNING about faux management consultants becomes important. Let’s begin by describing what a LLLCommunity owner/operator should look for in a bona fide management consultant, one specializing in this unique income – producing property type, and not from outside this realty asset class. First off, what are his/her property management consultancy capabilities?

One way to measure this is to look for – and verify, nationally – recognized credentials. And there’s really only one; whether the individual is an active Certified Property Manager® member of the Institute of Real Estate Management®. Sure, IREM does not train and certify LLLCommunity managers per se, but their requisite course work and rigorous peer approval system generally ensures a CPM®s application of ‘professional property management principles’ to one’s property challenge – once they know and understand property owner’s goals for a specific location or locations. There are 147 such LLLCommunity specialty CPM®s at work throughout the U.S. today. If listed here, every one of them would be viewed as a ‘household name’ throughout the asset class; as they hail from CA, AZ, OR, IN, IL, MI, PA, FL and beyond. To identify these specialty CPM®s in your region, simply go online to IREM.org and left click on the Find a Member tab.

Another means is to identify, and then verify, a would be management consultant’s claims of work experience. If you don’t perform this critical step, you deserve whatever results you experience. Right now, there are land lease lifestyle community owners in MI and IL who sorely wish they’d made such a phone call or two, in recent months, before retaining the services of one or more freelance PM consultants.

So, are CPM®s and experience – verified independent consultants, the only credible freelance property management experts afoot these days in the LLLCommunity realty asset class? No. There are indeed some Accredited Community Managers® or ACM®s and Manufactured Housing Managers® or MHM®s out and about; but guess what? Their ‘cred’ too needs to be tested, not only in personal interviews featuring pointed questions (e.g. Do they know how to compute physical & economic occupancy and understand the difference; same with Operation Expense Ratios or OERs – and are they conversant with the LLLCommunity Standard Chart of Accounts and Model OER percentages? If not, how do you and they expect to set performance standards, then measure results against them? *2), and make phone inquiries to previous employers and consulting clients as well. A key issue, relative to an ACM®, is to contact the certifying body, in this instance, the Manufactured Housing Educational Institute, via (703) 558-0653, ensuring the individual has completed all three stages of that educational program and actually been awarded the coveted ACM® designation. Same for the MHM® designee. In this instance, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and request verification of MHM® status.

Any other touchstones along the way to retaining the services of a freelance PM consultant? If a formal report is required, as part of the assignment, beforehand request a copy of their Mystery Shopping reports to other clients,
End Notes.

1. Physical occupancy = # rental homesites with homes on them; Economic occupancy = # rental homesites with homes on them where resident’s rent is paid current. For example: 180 occupied sites, divided by 200 rentable sites = 90% physical occupancy; while 160 occupied & paid sites, divided by 200 rentable sites = 80% economic occupancy. The latter calculation is more a performance ‘acid test’ than the former.

2. Want a resource featuring all the MHIndustry & LLLCommunity – related formulae, etc? Phone the aforementioned MHIndustry HOTLINE, and for only $19.95, order the new Book of Formulae, Rules of Thumb, & Helpful Measures for LLLCommunities, MHIndustry, commercial real estate, affordable housing, and realty – secured mortgage origination. PMN Publishing, Indpls, IN. 2012.

II.

More Differences Between Small & Large Owners/operators of
Land Lease lifestyle Communities….

OK, if you reading this line, and did not peruse last week’s blog posting at this web site (community-investor.com); you’d be better – served, right now, to scroll down thru this posting to blog # 217. There read what prompted the responses you’re about to hear in the paragraphs that follow…

Ready to go? The following commentary was penned by a several decades veteran of land lease lifestyle community on – site home sales and property management. He/she begins with a general statement, then focuses on one more key difference between, in this case, large versus small LLLCommunity owners/operators, specifically, consequences foisted on the latter by actions of the former.

“George. I’m sure I’m not the only one who recognizes the 800 pound gorillas (i.e. large property portfolio owners/operators) may be able to take advantage of their strength to float their realty assets along the meandering river of (business) life, but their lack of commitment to the long term health of their assets…and their leadership’s disdain for their customers…will eventually float them over the waterfall.”

“The…characteristic you may have overlooked (in the previous blog posting) rears its’ ugly head in certain local housing markets. When these (owners/operators) make large portfolio transactions, they essentially assign values to each asset (i.e. LLLCommunity), which are less grounded in reality, than in finance. So, trading them like baseball cards, at inflated values, winds up (providing) prima facia evidence for every county property appraiser’s inflated valuation calculations, and ultimately the amount of ad valorem taxes paid by smaller LLLCommunity owners/operators(in the same local housing market) – as well as residents, via pass – ons and pass – throughs. Witness what is happening to _______________ in ____________, after the ______________deal.” (Lightly edited.) GFA

Other blog readers weren’t as verbose; one simply wrote: “ (You) Hit the nail on the head!” – with the characteristics described in the previous blog posting.

III.

Initial Blog Reader Responses to ‘A Lesson in Growing & Caring for One’s Reputation’, from Management 101, for Land Lease Lifestyle Community Owners, Property Management Executives,
Regional & On – site Managers & Others!

Here too, if you didn’t read last week’s thoughts about earning and preserving one’s ‘rep’ in the business world, you might want to stop; scroll back to blog # 217, and read ‘A Lesson in Growing & Caring for One’s Reputation’.

Now today, recalling the totally unexpected, undocumented personal attack, followed with no opportunity to explain or defend myself, during a national business meeting in early October – and hinted at in blogs # 217, 216 & 215, the following ‘rep’ encouragement, coming from a manufactured housing industry veteran, is highly appreciated:

“I know you are too secure to worry about any of this, but I still wanted to remind you that the right people in our crazy industry love and respect you, and that’s not going to change. You are about results, not hot air, and you’ve proven you know what you are talking about, time and time again.” SF

See what I mean? Does take time, effort, and positive results, over time, to cultivate one’s good personal and business reputation. But, from time to time, there’ll be individuals who’ll make an effort to besmirch what one has done, said, penned, or otherwise. And there’ll also be other individuals with which, and to whom, one has proven themselves, repeatedly, who will come to one’s defense, one way or another – just as in the previous paragraph!

And to these latter, supportive individuals, who’ve stepped forward since this recent contretemps and voiced and written of their support, I say a sincere ‘Thank You!’ The status of this affair? Still awaiting a formal response and apologies resolving this sorry matter. GFA

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

Blog # 217 Copyright 2012 28 October 2012

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

I.

Getting It Out Into the Open! Some Differences Between Small & Large Owners/operators of Land Lease Lifestyle Communities…

II.

‘A Lesson in Growing & Caring for One’s Reputation’, from Management 101, for Land Lease Lifestyle Community Owners, Property Management Executives, Regional & On – site Managers & Others!

III.

DID YOU REALIZE?

IV.

Initial Blog Reader Responses to ‘A Lesson in Handling Interpersonal Conflict’, from Management 101 for LLLCommunity Owners, Property Management Executives, Regional & On – site Managers & Others!

***

I.

Getting It Out Into the Open! Some Differences Between Small & Large Owners/operators of Land Lease Lifestyle Communities….

First the numbers. It’s estimated there’re 50,000+/- land lease lifestyle communities in the U.S. Of these, 85% are income – producing properties with 100 and fewer rental homesites or sites. In Sunbelt states, the percentage is closer to 78. So, maybe 42,500+/- ‘smaller’ LLLCommunities in play.

The remaining 7,500+/- land lease lifestyle communities, containing 100+ sites apiece, have for the most part, been consolidated during the past 25 years, into 500+/- property portfolios. According to the 23rd ALLEN REPORT, these portfolios contain an average of 27+/- properties (X) 500+/- portfolios = 13,500+/- LLLCommunities of all sizes. Subtracting 13,500+/- from the estimated 50,000+/- base, leaves 36,500+/- ‘smaller’ LLLCommunities not yet – if ever, to be absorbed into existing or future property portfolios, defined as ‘entities owning and or fee – managing a minimum of five LLLCommunities and or 500+ rental homesites’. The difference between 42,500+/- ‘smaller’ LLLCommunities cited in the opening paragraph, and 36,500+/- here, is likely due to some, if not many, portfolios having acquired ‘smaller’ properties over time.

Off and on, during the past couple decades, an informal debate has ‘waxed and waned’, relative to differences in characteristics, foci, objectives, policies and procedures, where ‘large’ versus ‘smaller’ land lease lifestyle communities and property portfolios, and their owners/operators, are concerned. Here’re some of the obvious, but rarely talked about differences:

• Land lease lifestyle community consolidation, during the past 20 years – via limited partnership syndications of the 1980s (Until the federal tax law changed in 1986); a second wave of REIT formations during the mid – 1990s; and now, the presence of equity funds, have frequently, and at times negatively, affected state MHAssociation membership rolls, as well as participation in training and meetings. Formerly, Mom & Pop – sized and owned properties were often active and involved dues – paying members of state trade/advocacy bodies. However, once absorbed into a property portfolio, only the corporate entity – in most cases, contributes to just one association membership, and not a separate membership for each LLLCommunity. And these corporate entities (i.e. property portfolios) generally participate in statewide advocacy matters only when troublesome, potentially intrusive issues, usually landlord – tenant legislation – related, appear on the business horizon. There are, of course, exceptions to both trends in some states and local housing markets.

• Some large land lease lifestyle community portfolio owners/operators, when maintaining physical occupancy of rental homesites becomes an issue, ‘raid’ like properties in the same local housing market. One recent flyer sent to this industry observer boldly states: ‘Relocate Your Home to _______________ & We’ll Move Your Home for FREE, & Charge You Site Rent at $99.00/month for Three Years! Call ___________’ And this is occurring in a market where the average area site rent is around $400.00 per month. What’s a competitor or ‘smaller’ LLLCommunity to do? Raid back, if able. Otherwise, enlist assistance and support of like members in the state MHAssociation; however, if the raider isn’t an active member, expect the plea or argument to maybe fall on deaf ears.

• Some larger land lease lifestyle community portfolio owners/operators are under constant pressure, from investment analysts, to not only exhibit consistent property profitability, but ensure its’ increase – like a growth stock, from reporting period to reporting period. This pernicious pressure has, at times, led to rental homesite rates raised out of sync with other forms of rental multihousing in the same local housing market. An extreme manifestation of such pressure has led to property portfolio owners/operators, whose site rent is $100+/- above the local housing market’s average site rent rate, to all but give away resale homes already on – site (e.g. bought cheap from ‘don’t want it sellers’, abandoned and otherwise) to would be ‘homebuyers’ willing to commit to pay long term inflated homesite lease payments. Smaller LLLCommunities are not generally caught up in this ultimately self – destructive cycle.

• Given their inherent enhanced economy of scale (i.e. A 200 site land lease lifestyle community ‘well managed’, can experience an Operating Expense Ratio or OER, half that of a 100 site property), LLLCommunity portfolios generally have more internal resources (e.g. capital, equipment, staff), with which to address challenging developments and trends affecting the asset class’ day to day business. A current one being, variably restricted access to third party chattel home financing, leading to use of different self – financing mechanisms, such as ‘contract sales’, ‘carrying paper’, ‘captive finance’, lease option, and most recently, unit leasehold agreements on new and resale homes on – site. But do these larger firms routinely share their homegrown expertise, forms, Lessons Learned, and access, with their peers, large and small?

• Small (one property owner) to mid – sized, privately – owned property portfolios, for the most part, continue to operate in local housing markets, as traditional land lease lifestyle communities. How so? Being content with collecting fair site rent, and not much more; being ‘afraid & inexperienced’, as to how to actually buy new homes (absorbing ‘value depreciation’ in the process); filling vacant homesites themselves – having relied, during past decades, on local independent ‘street’ MHRetailers, who’re no longer in business; and now, unsure how to self – finance compliant transactions in the present financial regulatory imbroglio. And who will teach them how to ‘buy’, ‘sell’ & ‘finance’ their new and resale homes? That is the big unanswered question of today. It’s also the question the SECO organizers will pointedly address at their event this Spring in Atlanta, GA.

The list goes on. There remain several more characteristics that, unfortunately, seem to routinely separate the small from the big ‘players’ in the contemporary land lease lifestyle community realty asset class. What ‘differences’ dismay, confuse, frustrate, even anger you? Let me know via GFA c/o Box # 47024, Indpls, IN. 46247, this web site (community-investor.com) or (317) 346-7156.

II.

A Lesson in Growing & Caring for One’s Reputation, from ‘Management 101’, for Land Lease Lifestyle Community Owners, Property Management Executives, Regional & On – site Managers & Others!

“What people say behind your back is your standing in the community in which you live.” Edgar Watson Howe, quoted in The Forbes Book of Business Quotations. That’s especially true, even encouraging, when members of one’s (business) community knowing your good and longstanding reputation, opt to believe in and stand by you, when it counts!

The preceding quote describes one of the first business lessons I learned 40 plus years ago, on my first civilian job after leaving the U.S. Marine Corps, following a combat tour in the Republic of Vietnam. I’ve related the story before, in the published short story, ‘Got Rep?’ The gist of that tale is, I was a lumberyard supervisor responsible for a rough, mostly minority, work crew. After two years on the job, I was promoted and transferred to the Midwest. Then…

During an after hours farewell party with my crew, I learned the real ‘secret to my supervisory success’. It had to do with a false reputation of me being ‘a handy Marine with a blade’ in Vietnam. Turned out that a crew member had been in the U.S. Army, in the same region of RVN, at the same time as me. In an effort to enhance his own rep and standing among our co – workers, he concocted a hand – to – hand combat tale about me; in effect, warning others not to unduly aggravate either of us. While I benefited from the residual effects of the tall tale, it certainly wasn’t the leader rep I coveted. A free copy of the short story is available by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

Now for the comment accompanying the above quotation. Business reputations are indeed built over time, generally the result of personal, corporate, and social performance, good and bad. And reputations can certainly be sullied more quickly than earned. But there can also be an upside – one I’m relearning and appreciating today! Given a good reputation, especially one built during many years of service to one’s peers, it can be difficult – if – not – impossible, for an interloper, a faux friend, or anyone else, to effectively besmear it! And that’s a good and comforting thing.

For example; having been inducted into the RV/MH Heritage Foundation’s Hall of Fame, named MHI’s ‘Industry Person of the Year’ in 2008, and granted Emeritus status as a Certified Property Manager®, along with other reputation confirmations, recent whispered efforts by a particular low life have fallen on deaf ears, as the tale spinner attempted, unsuccessfully I’m told, to turn at least one national association executive against me, in an attempt to smear my good reputation. He/she failed.

So, how does one defend against such actions? Sometimes you can’t and don’t; especially when one doesn’t know about the matter. But given a ‘good rep’, it can say more (positive) about you, when not striking back, in anger or otherwise; letting the offending party run off at the mouth, and in effect, damaging their own reputation, as listeners reflect: “Hmm. If he/she says this about him, what will he/she say about me?”

III.

DID YOU REALIZE?

When the year 2013 rolls around, where matters of national manufactured housing advocacy are concerned, our industry will be led and represented by two DGs:

DG (Don Glisson, Jr.) at MHI

&

DG (Danny Ghorbani) at MHARR

The point? There is none, at least none that anyone will take seriously, even though they should. Huh? MHI, for the most part begins the New Year with New Leadership in virtually every position (e.g. Dick Jennison as president & CEO; Jenny Hodge as executive vice president of the NCC division, et. al.). And MHARR? Long and rightly acknowledged as the ‘watchdog of the manufactured housing industry’, be alert to something of ‘paradigm shift’ import to materialize, from this national advocacy body, early during 2013. Hint? A takeoff on the old riddle: ‘What’s black and white and (intended to be) read all over?’ No, not a ‘newspaper’, in this instance, but close….

IV.

Initial Blog Reader Responses to ‘A Lesson in Handling Interpersonal Conflict’, from Management 101 for LLLCommunity Owners, Property Management Executives, Regional & On – site Managers & Others!

OK, here’re two of several written responses to last week’s blog posting:

“Conflict facing is difficult for many, but when tried as you lay it out, it becomes an everyday benefit of a relationship. Good for you, sir.” NB

“…use my credo: ‘If someone is giving you trouble for no apparent reason; give the SOB a reason!’ “ BB

Just goes to show you, there’s generally more than one way folk deal with difficult situations.

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indpls, IN. 46247 (317) 346-7156

Blog # 216 Copyright 2012 21 October 2012

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

I.

A Lesson in Handling Interpersonal Conflict, from ‘Management 101’, for Land Lease Lifestyle Community Owners, Property Management Executives, Regional & On – site Managers, & Others!

II.

REMINDER: A Unique, Once in Two Decades Opportunity for YOU to Provide Valuable Input to an Author (Not me!) Who Is Researching & Writing the First Definitive Book on Factory – built Housing in General, HUD – Code Manufactured Housing in Particular. How Could YOU Not Want to Participate?

III.

Coming Soon & During the Year 2013: Super Symposiums in States Where They Haven’t Been Held Before; at Least Two New HUD – Code Home Shows, with at least one Featuring Community Series Homes or CSH Models; several one day Manufactured Housing Manager® Classes; and, New, Not for Profit Research & Resource Entities to Serve Land Lease Lifestyle Community (‘LLLCommunity’) Owners & Operators Throughout the U.S. & Canada!

*********

I.

A Lesson in Handling Interpersonal Conflict, from ‘Management 101’, for Land Lease Lifestyle Community Owners, Property Management Executives, Regional & On – site Managers, & Others!

Here’s how to quickly – if not soon redressed, lose a friend, offend a customer (e.g. land lease lifestyle community resident) or long time colleague; and, severely damage one’s leadership reputation among fellow businessmen and women. Without warning….

• Openly criticize one or more of these individuals by name, in a public forum

• Read from a list of alleged offenses, but don’t share those notes when asked

• Don’t allow opportunity for rebuttal or defense, on the part of the criticized party

• And worst of all, do not apologize for one’s heavy – handed, cowardly actions

It’s unlikely all four travesties will occur during one interpersonal conflict scenario; but taken together, they paint a clear picture of how not to function as a mature business leader.

So, what’s the correct way to handle sensitive, and at times critical matters, of this nature? Well, there’re several time – honed guidelines, that capable, experienced, motivated leaders of men and women, have practiced over the years. They include:

• ‘Praise in Public, Criticize in Private!’ Then, related to this sage advice, apply the…

• Golden Rule: ‘Do unto others as you would have them do unto you!’ Oh, it’s difficult sometimes, to recall, let alone apply, this apt wisdom during the heat of anger and passion of the moment. But STOP and ponder this: ‘How would YOU feel, if someone, without warning, criticized YOU in public – in front of mutual peers and friends, then gave YOU no opportunity to explain or defend yourself?’

• Then there’s the HEAT acronym, used by generations of professional property managers, when dealing with angry residents, even arguments between residents – when they can’t be avoided. HEAT goes like this. First; get everyone to sit down, eliminating ‘flight & fight’ options. Then; H = Hear both sides of the story! E = Empathize with the offended party; attempting to understand his/her perspective on the issue(s) at hand. A = Apologize, if appropriate; and finally, T = Take appropriate action! But also heed this WARNING! If one gets the acronym backwards – as many do, ‘Taking Action’, before executing the key ‘H’ & ‘E’ steps, he/she will find the Apology step, doubly appropriate and painful!

So, there you have it, How Interpersonal Conflicts, especially in business environs, Should Be Handled. In summary: Do so in private, in fairness, in balance, and in preservation of one’s present and future personal and business relationships! Anything less is a clear sign of ignorance, immaturity, and insensitivity.

Next week’s lesson from ‘Management 101’? Pick a topic and let me know where we should go next….

II.

REMINDER: A Unique, Once in Two Decades Opportunity for YOU to Provide Valuable Input to an Author (Not me!) Who Is Researching & Writing the First Definitive Book about Factory – built Housing in General, HUD – Code Manufactured Housing in Particular. How Could YOU Not Want to Participate?

That’s right! Not since Allan Wallis’ Wheel Estates: History of the Manufactured Housing Industry, published in 1991, have we had an academic or author – with – credible – manufactured – housing – experience, launch a project ostensibly relating our nation’s ‘State of (too expensive) Housing’ to the quality, affordable, transportable, non – subsidized housing alternative represented by HUD – Code manufactured housing and, to a lesser extent, its’ land lease lifestyle community component.

Last week’s blog posting featured three paragraphs describing the author’s present ‘take’ on this timely, large subject. Suggest you scroll back into the blog archive at this web site and reread that material. Then, if YOU believe YOU have valuable input for the author, put an outline or summary manuscript together and mail it to me via GFA c/o Box # 47024, Indianapolis, IN. 46247; or via GFA7156@aol.com; or FAX it to me at (317) 346-7158. If you’d like to discuss the matter further, with me, before spending time on preparation, etc., phone me via the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

III.

Coming Soon & During the Year 2013: Super Symposiums in States Where They Haven’t Been Held Before; at Least Two New HUD – Code Home Shows, with at least one Featuring Community Series Homes or CSH Models; several one day Manufactured Housing Manager® Classes; and, New, Not for Profit Research & Resource Entities to Serve Land Lease Lifestyle Community (‘LLLCommunity’) Owners & Operators Throughout the U.S. & Canada!

This paragraph will by shy on details, as most of the title events are in planning stages, even as to dates and symposium, show, and class venues.

• Watch for Super or Power Symposiums to pop up in at least New York, Georgia, Indiana, and quite possibly Virginia.
• New Home Shows, featuring HUD – Code homes in general and Community Series Homes in particular? Look for these in Georgia, and possibly Tennessee – or wherever the 22nd International Networking Roundtable is held during 2013.
• Manufactured Housing Manager® professional property manager training and certification classes are already scheduled for Oklahoma (late February) and Indiana, with more anticipated elsewhere. Interested in earning your MHM® designation? Phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.
• Center for Manufactured Housing Studies or CMHS is already in place in Athens, OH. Expect to read more about its’ work during 2013. And, it’s become clear, the only way I’ll be able to eventually exit the LLLCommunity ‘resource – servicing’ business, to semi – retire, will be if a new, national, not for profit entity is birthed, to serve our asset class’ education (MHM® program), communication (newsletters & this blog), networking (Networking Roundtable & FOCUS Groups), research (in conjunction with aforementioned CMHS), and deal – making needs, from sole proprietor – owned properties up through the largest of portfolio ‘players’. There’s already a group of a dozen or more LLLCommunity owners in place, to bring that historic development to fruition. Interested in helping? Let me know via (317) 346-7156.

So, is that enough excitement with which to greet the New Year? It certainly is for this industry observer. My only hope, relative to those events, is that our national manufactured housing advocacy bodies would finally ‘get on board’, and actively encourage and support all the above – referenced events, even when they don’t have a direct role in planning and facilitating them.

***
George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

Blog # 215 Copyright 2012 14 October 2012

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

I.

Some News & Views Out of San Antonio, TX.

II.

Want to Contribute? Not $. Something more valuable; your input!

III.

Power Symposium, in Indianapolis, IN. @ 18 October 2012

IV.

Get Certified as an MHM® & Buy New MHomes the Same Week!

***

I.

Some News & Views Outa San Antonio, TX.

No ‘hoped for’ rebranding of HUD – Code manufactured housing. No revisiting of the Community Attributes System or CAS, requested a year ago! No written goals or priorities published for the year ahead, where land lease lifestyle communities are concerned. And frankly, no more participants overall, than at like meetings, during the past three; no, make that four, years running.

But there was motivation to continue rebranding ‘land lease lifestyle communities’! And there were off – agenda conversations about revisiting the ABClassification System for rating LLLCommunities, per A, B, C, & D grades, instead of 5, 4, 3, 2, & 1 STAR quality – a suggestion from the 21st annual Networking Roundtable in San Diego, CA., proffered by Dick Bessire of Bessire & Casenhiser. During Monday’s meeting, there was obvious recognition, on my part, it’s time for Community-Investor, a.k.a. GFA Management, Inc., dba PMN Publishing, to renew its’ 30+ year commitment to (continue to) be the realty asset class’ primary, ongoing source for Research & ‘comprehensive Resource servicing’ nationwide!

And finally; a sincere personal Thank You to individuals who’ve privately expressed support and embarrassment to Carolyn and me, during and since our visit to San Antonio, TX. It’s encouraging to see friendship and respect trump false claims disguised as PC, and not be given opportunity to rebut! GFA

II.

Want to Contribute? Not $. Something more valuable; your input!

A published business author, familiar with factory – built housing in general, and manufactured and modular housing types in particular, is conducting research, identifying factors that’ve precipitated our business model’s decade long new home shipment nadir; and what it’s likely going to take, during years ahead, for our industry to return to prosperity – measured by market share in the national housing market. He’d like confirming, contrary, and creative input on these matters, from thoughtful, industry – experienced individuals, willing to share their views and ideas.

Before I tell you how to get your input into his hands for review and consideration, here’re three perspective paragraphs I asked him to prepare; in effect, setting the stage for your views and ideas….

Housing in the U.S. today, is too expensive, and likely to become more so, because it depends upon well – developed, intentioned, and entrenched, but moribund processes and traditions. Many attempts have been effected to rectify this pattern, but only one has proven workable; that being, ‘manufactured housing’ . Unfortunately, this type housing has been denigrated over time, because it’s foreign to those above – referenced American home – building traditions; and also saddled with a bad image, due in part, to its’ ‘trailer’ heritage and stigma. This dual image issue continues, as communities and municipalities, maybe the entire nation, say they seek – but do not really like – ‘low cost housing’!

Furthermore, our nation has become increasingly service – oriented, because we’ve lost much of our manufacturing edge, having priced and out – sourced ourselves out of the market. That’s working OK, only because we can import most material stuff at competitive prices. But we cannot import housing, and until recently, its’ cost has increased faster than CPI.

This book will make that logical case and more. The hardest audience to convince, however, will be skeptics having a trailer mindset, i.e. ‘doing everything on the cheap’. Which in turn, raises the question: Where and how does ‘cheap’ end and ‘affordability’ begin? The real challenge, for everyone in the manufactured housing industry, is to be committed, in short and long runs, to work together at 1) improving the industry’s aforesaid image, while 2) reducing post – manufacturing service costs that eat up savings garnered by the manufacturing process. Both are difficult to accomplish. The first is decades long – entrenched. And few factory systems have successfully addressed on – site (customer service) challenges, many don’t try. One thing is for certain though; putting today’s reputation and profits ahead of customers’ perceptions and need for service, are two lanes on the highway to failure. (edited. GFA)

OK; are you ready to pen confirming and contrary responses, astute observations, and the like, to this author? If so, send a hard copy to GFA c/o Box # 47024, Indianapolis, IN. 46247, or fax it to me via (317) 346-7158. Anyone who does so, will receive advance notice of when this new manufactured housing – related book will be available for distribution. Hope to hear from YOU soon!

III.

Power Symposium, in Indianapolis, IN. @ 18 October 2012

What are the on – site, home sales transaction, property owner – financing options ‘in play’ these days in land lease lifestyle communities throughout the Midwest and beyond”?

What are the new and resale home finance state and federal regulatory compliance issues that MUST be known, in place, and routinely updated these days, in and out of land lease lifestyle communities?

Why it’s best to use trained and licensed installers when siting, or moving new and resale homes around and throughout your land lease lifestyle community?

All you’ve wanted to know, but didn’t know who to ask, about ‘hands – on, best property management practices’ pertaining to land lease lifestyle communities, where ‘100% rent collection is concerned; ensuring you – and your on – site home sales staff, don’t ‘sell more house than a customer can or realistically should buy’; and, Lessons Learned, such as ‘How good Resident Relations leads to more Resident Referrals means more Resident Retention!’ – and much more!

Get the idea? Just like the Super Symposiums before this one, the Indiana Manufactured Housing Association is ‘pulling out all the stops’, to host a day long training event for its’ members and guests from throughout the Midwest. Will YOU be there? I certainly plan to be!

To register, phone (317) 246-7258, X # 11, and tell Mark Bowersox that ‘Hey, George sent me!’ Seriously. Hotel? Special block of $93.00/night rooms set aside, at the Wyndham Hotel, for those who phone (317) 248-2481, and use code: Indiana Manufactured Housing Association.’

From an historical perspective, former IMHA/RVIC employee Jim Keller birthed the idea of Super Symposiums several years ago, right here in Indiana. Since that time, successful state MHAssociation – hosted Super Symposiums have occurred in Ohio, New York, several times in Atlanta, GA., and elsewhere, besides the annual ones facilitated in Indianapolis, IN. So, as we meet, once again, for – in this case – a Power Symposium, ‘give a nod’ to Jim, for getting us started down a path that’s helped many to not only Survive these difficult times, but actually begin to Prosper as well. Thanks Jim!

IV.

Get Certified as an MHM® & Buy New MHomes the Same Week!

Yes, I know 27 February, and 28 – 31 February are a ways out there, date wise; but there’re good reasons for teeing – you – up so far in advance:

First off; this will be the first Manufactured Housing Manager® professional property management training and certification class of the New Year, 2013! We expect this one day class, to be sold – out, with 25 or so MHM® candidates. So, don’t be left out, (800) 234 – 6426 to register, and ask for a brochure containing additional course information. We’ll be meeting in the Deer Room at the Hard Rock Casino & Hotel in Catoosa, OK.

FYI. To date, nearly 1,000 land lease lifestyle community owners and managers have been trained and certified as Manufactured Housing Managers® or MHMs®. Isn’t it time YOU joined their ranks? Furthermore, George Allen, CPM®Emeritus & MHM®Master has taught all the one day MHM® classes to date; and this is the only professional property management class in the U.S. today, taught by a LLLCommunity owner. And for the $250.00 cost ($350 for non – members of OMHA), MHM® candidates receive a copy of the text Landlease Community Management, a monograph of contemporary MHIndustry ‘readings’, gold MHM® lapel pin, and MHM® certificate. Finally; there are NO TESTS.

Also plan to ‘stay over’ and participate in the Great Southwest Home Show; where Trade Days will occur 28 February thru 1 March; and 2 & 3 March are reserved at Public Days. Show will be at the QuikTrip Center at Expo Square in Tulsa, OK. See YOU there? I hope so!

*****

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Aficionados Nationwide
Box # 47024, Indianapolis, IN. 46247
MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

Blog # 214 Copyright 2012 7 October 2012

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

I.

Blog Readers’ Responses to Last Week’s Question: ‘MHIndustry Leaders! Where Will YOU Take US in 2013?’

II.

In Search of a MHSherpa, or maybe Guru, or probably Maven….

III.

The Symposium Movement Lives – on! In Indy @ 10/18/2012

***

I.

Blog Readers’ Responses to Last Week’s Question: ‘MHIndustry Leaders! Where Will YOU Take US in 2013?

Rarely have to wait long, when a weekly blog posting at community-investor.com, ‘touches a nerve’ with its’ readership. While not heavy in volume this past week, the nature of the responses has been weighty indeed. Here’re but two of them:

“Could we assume we, as an industry, are tip – toeing to the ‘tipping point’ of oblivion? I remain amazed and disappointed by our ‘leaders’.” NB. Well, here’s a coincidental postscript to that blog flogger’s (reader’s) question and comment:

One MHIndustry executive, enjoying salaried and elected positions of leadership, sees what I pen, as being

“…public attacks against MHI, and (the) public positions you take are counter to the industry’s interests….” The critic goes on to cite two examples from recent blog postings at the community-investor website:

• He/she says I’m “…asserting that (land lease lifestyle) community rents are too high.” My response? Yes, in some local housing markets, and possibly too low in others.

• He/she asserts I’m “…trying to create and apply generalizations for economic relationships, between land values and home/improvement values that fundamentally don’t exist.” Here the writer refers to the decades old 3:1 Rule of Thumb*1, regarding a supposed relationship between LLLCommunity monthly homesite rental rates, and the monthly rent amount for 3BR2B conventional apartment units in the same local housing market, assuming they’re weighted evenly regarding what’s included therein. Anyway, this particular Rule of Thumb has been in play since the mid – 1970s, and was NOT created by me.

Further response? Twofold. FIRST; there’s the old bromide, ‘Beware of generalities, as they’re generally as wrong as they are right!’ That’s apropos to both scenarios described above; as our industry, and asset class, is indeed ‘local housing market driven’. So again; Yes, in some cases LLLCommunity site rent might well be ‘too high’; in others, ‘too low’. Where the Rule of Thumb is concerned, it’s simply a self – applied tool to give one a preliminary ‘feel’ for multifamily rental property rates within a given local housing market. No more; no less. And SECOND? How ‘bout if you take a few minutes to let me know how YOU feel about both ‘issues’, relative to our realty asset class. See end of this blog posting for contact information.

And here’s yet another viewpoint expressed by a faithful blog flogger:

“It isn’t that would be homebuyers don’t ‘want’ the nicer houses (our HUD – Code manufacturers build), they simply can’t ‘afford’ the nicer ones! That’s why many of us land lease lifestyle community owners are remodeling used homes and ‘carrying the paper’, one way or another, to accommodate rent – to – own or lease option buyers, even those simply leasing the units. Here in the Midwest, when the home sale price nears $20,000, or goes slightly over that, we frequently have to hold the inventory for several months. Then, we get $1,000 or $1,500 down, or if we’re very lucky, $2,500. I try to ‘carry paper’ for no longer than five years, but with more expensive homes, we sometimes have to go out six or seven years, to make the payments fit the buyer’s budget. Here’s a new twist for you, illustrating how much of an entitlement society our society has become, thanks to the current national political climate. Some of our applicants now list ‘unemployment’ as their job! Then I have to explain that ‘unemployment’ is not a job. But that when they do have a ‘real job’, with a real paycheck, they should come back and reapply to buy a home from us.” SN (edited. GFA)

II.

In Search of a MHSherpa, or maybe Guru, or possibly Maven…

A wealth management group, in a recent ad, likened their financial expertise to that of a sherpa:

‘A knowledgeable, experienced guide that provides exceptional guidance and support when venturing into dangerous, unknown territory.”

Wow! Could we ever use one of those folk, a sherpa; better yet, a MHSherpa! Think about it! Someone who understands, lives and works the HUD – Code manufactured housing business, has it ‘in their blood’ (‘Ah, the attitude & motivation to succeed!’); and is capable of ‘leading’ (‘guiding’) us from ‘in front’ AMD ‘behind’ (support), into present day dangerous, once known – but now unknown, territory, purveying truly affordable housing to those living below their local housing market’s Area Median Income, but desiring to live in a place of their own, building equity along the way!

Or maybe we’re talking about needing a guru here; you know, a MHGuru! By definition…

‘…any person who counsels or advises, a mentor; a leader in a particular field.’

Hmm. That sounds familiar. I recall a number of faux MHGurus who’ve ‘come and gone’ over the years; no, make that dozens during the past three decades. While more than ‘flashes in the pan’ at the time, none hung around very long; often growing (their businesses) ‘far too big, far too fast’, before flaming out. For that matter, I don’t see many, if any, bona fide MHGurus on the manufactured housing business horizon, or even military crest (that’s the backside of a hilltop, where one enjoys a measure of cover and concealment from one’s enemy or opponent) these days! Just a few self – effacing ones, successful in their own right, but content (albeit ‘selfish’?) staying in the background, running their own companies, not particularly helping our industry and asset class at large, to survive and once again thrive. Any self – effacing MHGurus out there listening, and motivated to read this paragraph as a personal Call to Arms (Help)? Let’s hope so….

Or perhaps it’s simply a maven, a MHMaven, we seek. You know, someone who’s an expert (at what they do), a connoisseur of sorts: ‘one competent to pass critical judgments in an art (of homebuilding), or in matters of taste (curb appeal and resident relations)’, and ‘a discerning judge of the best in any field.’ Now there’s a place to start!

A MHSherpa or two together, to guide us into dangerous, unknown territory; assisted by one or more MHGurus with proven ability and experience – honed knowledge; whose progress is measured and judged by MHMavens with the best interests of the HUD – Code manufactured housing industry and land lease lifestyle community asset class in mind and practice! WOW, what a team, if we could just put it together – soon!

So, how do we find these individuals, ‘players’, entities? Well, something was penned, during the past few weeks of online blogging, about the Manufactured Housing Institute sponsoring a volunteer Blue Ribbon Task Force to, in some folks’ minds, ‘Save Our Industry!’ Since this national advocacy body is meeting in San Antonio during the next several days, let’s watch and see what might come out of those meetings of the various membership divisions, not the least of which being the National Communities Council division. Calling all MHSherpas; MHGurus; and, MHMavens!

III.

The Symposium Movement Lives – on! In Indy on 10/18/2012

Mark your calendars with the date 10/18/2012, then phone (317) 247-6258, extension # 11, and ask Mark Bowersox for details! All I know, for sure, is I plan to participate, as I did SECO, in Atlanta, GA., a couple months ago. And likewise, come away with some new ideas and helpful suggestions I can use in my businesses. See YOU there? Hope so….

*****
End Note:

1. 3:1 Rule of Thumb. Simply, it generally takes the rent collected from three rental homesites in a land lease lifestyle community to equal the rent collected from one 3BR2B conventional apartment or townhouse, in the same local housing market.

*****

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764