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

‘God Forgive Me When I Whine’

A Inspiring Message from the Telephone Doctor, Nancy Friedman

Quoted from her ‘Monthly Communications Article’ for December 2012. This is the poem with which Nancy closes every keynote address:

Today, upon a bus, I saw a lovely girl with golden hair,
I envied her, she seemed so gay and wished I were as fair; When suddenly she rose to leave, I saw her hobble down the aisle;
She had one leg, and used a crutch, and as she passed – a smile.
O God, forgive me when I whine.
I have two legs. The world is mine.

And then I stopped to buy some sweets,
The lad who sold them had such charm, I talked with him – he seemed so glad –
If I were late, ‘twould do no harm.
And as I left he said to me: “I thank you. You have been so kind. It’s nice to talk with folks like you. You See,” he said, “I’m blind.”
O God forgive me when I whine.
I have two eyes. The world is mine.

Later, walking down the street, I saw a child with eyes of blue,
He stood and watched the others play;
I seemed he knew not what to do.
I stopped a moment, then I said: “Why don’t you join the others, dear?”
He looked ahead without a word, and then I knew – he could not hear.
O God forgive me when I whine.
I have two ears. The world is mine.

With legs to take me where I’d go
With eyes to see the sunset’s glow – With ears to hear what I would know.
O God, forgive me when I whine.
I’m blessed indeed. The world is mine.

Author Unknown.

Who’s the Telephone Doctor? A longtime specialist in customer service, with emphasis on telephone etiquette and effective performance. She’s been interviewed by Oprah Winfrey, and retained as a featured speaker and instructor by many Fortune 500 firms. I first met her a couple decades ago, when she addressed MHRetailers gathered at what was then known as the Midwest Manufactured Housing Show, now the Louisville MHShow (11 – 13 January 2012). Contact her via (314) 291-1012 or nancyf@telephonedoctor.com

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Other ( $ Business – related) Topics of Interest

I.

Government National Mortgage Association (‘GNMA’) ‘Opens Window of Opportunity Regarding FHA Title I Securitization’

As YOU likely know, until more capital finds its’ way, from independent third party chattel financing lenders, to the HUD Code manufactured housing industry, we’ll continue limping along, as we have for the past three years, at only 50,000+/- new home shipments per year, compared to the 372,843 new homes shipped during 1998!

One hang-up has been GNMA’s requirement of a minimum net worth of $10,000,000 for issuers (of FHA Title I loans) and a reserve of 10% of all outstanding Title I MH loans, a.k.a. the ’10 – 10 rule’. GNMA now encourages lenders, or what some refer to as the ‘post – production sector’ of the MHIndustry, “…to directly provide GNMA with information that would support and justify a lower net worth level, including, possibly, information supporting a sliding scale net worth requirement tied to business volume….” This quoted from an MHARR memo dated 12/19/2011. For more information, phone (202) 783-4087.

If you’re one of those individuals, or head a finance firm interested in participating in this market, but are presently excluded by dint of the above – referenced 10 – 10 rule, directly contact:

Theodore W. Tozer, president, GNMA @ 550 12th St., SW, Washington, DC. 20024

Gregory A. Keith, Sr. VP, GNMA @ 550 12th St., SW, Washington, DC. 20024

II.

And on yet another, closely related and equally timely topic

Here’s your only opportunity to submit comments to the Consumer Finance Protection Bureau (‘CFPB’), on or before 17 February 2012, concerning interim regulations published in the Federal Register, on 19 December, regarding transfer of regulatory responsibility of the S.A.F.E. Act from HUD to the CFPB, under the Dodd – Frank law, effective 30 December 2011.

A copy of the interim rule can be obtained via www.regulations.gov (enter keyword “CFPB-2011-0023”).

Why do so? The CFPB is interested in learning, from YOU, of elements of the interim rule that are ‘outdated, unduly burdensome, or unnecessary’. Like I wrote; this is your only opportunity to identify and bring those onerous $ regulatory provisions to their attention. If you have serious concerns, and don’t respond; well, learn to live with those outdated, unduly burdensome, unnecessary and onerous $ regulations during 2012!

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January Opportunities for LLCommunity Owners/operators

11 January 2012. Visit Fleetwood Homes’ Community Series Homes (‘CSH’) exhibited during the Louisville MHShow (nee Midwest Manufactured Housing Show), at the Kentucky State Fair Grounds, 11 – 13 January. I’ll be present at Fleetwood Homes CSH exhibit mid – afternoon, 11 January, to ‘talk CSH design’ with YOU. Might even be a surprise in store for those who stop by to visit. To register, phone (770) 587-3350. And while you’re touring other homes exhibited at this year’s MHShow, ask, “Why no Community Series Home here for me to buy and put into my landlease community?” Seriously!

12 January 2012. Get Certified! As a Manufactured Housing Manager® or MHM®, at the Comfort Inn on Philips Lane (road at the Kentucky State Fairgrounds entrance) between 8AM & 4PM. Pre – registration @ $250.00 required! This is the only national professional property management training and certification program designed for the landlease community owners, operators, and resident managers! Nearly 1,000 MHMs have been certified to date. Again, pre – registration is a must, so phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 ASAP. Why? Class limited to 20 individuals and we’re halfway there already. Participants receive a copy of the Landlease Community Management $75.00 textbook as part of their registration fee.

26 & 27 January. FOCUS Group, for LLCommunity owners only. Convenes in Tampa, FL., at Lamplighter on the River. If you’d like to be considered for an invitation to participate, phone (317) 346-7156 ASAP. Why? FOCUS Group is limited to 20 LLCommunity owners and senior executives, and we already have 16 committed to participate. Plan to arrive mid – afternoon on the 26th, stay at same quality hotel, enjoy a special networking dinner that evening, and spend from 8AM until 2PM, on the 27th, ‘working through’ a five topic agenda – based on suggestions submitted beforehand by registrants. Cost? Meeting expenses are totaled and invoiced, on a pro rata basis, after the FOCUS Group meeting. There is no other venue like this in the realty asset class! It’s been convening for 20 years, and at one time or another, most of the major and most successful landlease community owners/operators have participated.

And that’s not all! There’s also a January meeting scheduled pursuant to maybe introducing a new chattel finance program for owners of individual and small portfolio landlease communities engaged in one or another form of self – finance to consummate on – site home sales transactions; in effect, creating a new, four – legged $ business model involving:

1) HUD Code home manufacturers routinely designing and shipping Community Series Homes (a.k.a. ‘CSH’) into landlease communities, or desiring to do so; and willing to offer a discounted wholesale price to pre – qualified landlease communities and or their principal owners.

2) Independent third party lender(s) intent on ‘doing more business’ with pre – qualified landlease communities and or their principal owners.

3) Sole proprietors, partnerships, and corporate owners of pre – qualified landlease communities and small portfolios

4) Prospective homebuyers/site lessees in search of and deserving a ‘value proposition’ where the amount of home they buy and mortgage, is in accords with what they can truly afford, and the participating LLCommunity’s homesite rent rate is truly in sync with other forms of multifamily rental housing in the same local housing market.

This new four – legged business model also presupposes serious conversation, and eventual evolution – the sooner the better – of a functioning, supportive secondary market for the marketing, sale, even financing of resale manufactured homes within and outside landlease communities. For more details on these evolving manufactured housing chattel finance and secondary market programs, read the January 2012 edition of the Allen Letter professional journal. You know, the one that contains the 23rd annual ALLEN REPORT, a.k.a. ‘Who’s Who Among Landlease Community Portfolio Owners/operators Throughout North America!’ Not yet a subscriber? Phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 or this website: www.community-investor.com TODAY.

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George Allen, CPM®Emeritus, MHM®Master. Box # 47024, Indianapolis, IN. 46247

My Gift to Every Combat Veteran & Their Family & Friends

“Greater love hath no man than this, that a man lay down his life for his friends.”*1

Recently came across some searing quotes in a true story, describing the combat experiences of Sergeant Dakota Meyer, the first living Marine recipient of the Congressional Medal of Honor since the Vietnam War.*2 Not only did these passages stir personal memories of a lonely Christmas 43 years ago in Vietnam, but they set the stage to review a new book – or two, that in my opinion, should be required reading for every young man and woman, as well as their family members and close friends, before departing for a combat theatre.

“When you leave the (defensive) perimeter, you don’t know what’s going to happen, regardless of what war you’re fighting in,” Sergeant Major Kellogg said, “Once you get to a point where you make the decision – ‘I’m probably going to die, so let the party begin’ – once you say in your mind you aren’t getting out of there, you fight harder and harder.” P.16 This so true view begs this question, ‘How does one return home and leave such a mindset behind?’

“I lost a lot of Afghans that day,” Meyer said. “And I’ll tell you right now – they were just as close to me as those Marines were. At the end of the day, I don’t care if they’re Afghans, Iraqis, Marines or Army; it didn’t matter. They’re in the same shit you are, and they want to go home and see their family just as bad as you do.” P.18 Then these questions, ‘When they return home, how do they leave such experiences behind – or do they, or even, should they?’

“Being a Marine is a way of life,” Meyer said. “It isn’t just a word, and it’s not just about the uniform; it’s about brotherhood. Brotherhood means that when you turn around, they’re there, through thick and thin. If you can’t take care of your brothers, what can you do in life?” p.20 That’s why I’m grateful for my military heritage. To this day, Marines JD Richards, Spanos, Dietz, my brother Mark, and others, all ‘Have my back!’

With that said, Karl Marlantes’ new book, What It Is Like to Go to War, while probably not for everyone – particularly those who abhor war and the killing that goes with it; is indeed, a ‘necessary read’ for we who appreciate our freedom and lifestyle as American citizens, as well as our men and women of combat, who protect and preserve those highly valued qualities in our behalf.

Some may remember the Marlantes’ first book, Matterhorn. While couched as historical fiction, it is in truth, a wholly accurate and graphic account of small unit infantry combat in the Republic of Vietnam during the late 1960s. Having been there, at the same time in the I Corps theatre of operations, as then Marine lieutenant Marlantes, I’m familiar with incidents he describes, to tell his story. And it was through reading that book I became convinced ‘he well knows about what he writes’ in What It Is Like to Go To War. Here’re a couple passages, from the beginning and near the end of this book, that touched me, as they will you – or a friend or relative, in personal and special ways:

“The Marine Corps taught me how to kill, but it didn’t teach me (how) to deal with killing.” P.3. And, “The returning warrior needs to heal more than his mind and body. He needs to heal his soul.” P.196. For those who’ve read my short story, ‘Making Amends’, know the culmination of my healing didn’t occur until Christmas Eve 2005, 43 years following my return from the Republic of Vietnam as a Marine lieutenant. That’s when I met Catherine, the manager of a pharmacy in Indianapolis. At a critical point in our first conversation, and as it turned out – our very lives, we shared what happened to us – from widely different perspectives, during 1968 and 1969, relative to that conflict. And as I wrote in that vignette, “We talked. I cried. She atoned.”

Well, author Marlantes makes this matter of dealing with the personal aftermath of armed conflict crystal clear, in this introduction to chapter # 9, titled ‘Home’.

“Returning from the initiatory space of the battlefield to the normal world is every bit as mysterious a journey as entering the Temple of Mars (war). The world you left behind has changed and you have changed. You know parts of yourself that you, and those you’ve lived with all your life, never knew before. You’ve been evil, and you’ve been good, and you’ve been beyond evil and good. You’ve split your mind from your heart, and you’ve split your heart with grief and your mind with fear. Ultimately, you’ve been in touch with the infinite, and now you are trying to reconcile yourself to the mundane. The warrior of the future will need to know how to enter and exit both worlds, if not with ease, then at lest without permanently disintegrating his or her personality.” P.176.

This is why every combat veteran, past and present; as well as their family and close friends, should read Marlantes’ new bok. And there’s much more within its’ 256 pages; everything from the act of killing, feelings of guilt, numbness and violence, ‘the enemy within’, lying, loyalty, heroism, ‘the club’, and much more. One simply cannot read this book and walk away unaffected, whether for personal reasons – or just as important, how one henceforth relates to friends and relatives, who’ve gone off to war and likely returned less and more than whole.

If you’d like a copy of ‘Making Amends’, request it via (317) 346-7156 or gfa7156@aol.com George Allen c/o Box # 47024, Indpls, IN. 46247

End Notes:
1. John 15:13, and 2)‘Marine Braves the Jaws of Death Five Times’, by Cpl. Reece Lodder, USMC, Soldier of Fortune magazine, December 2011, pp. 14 – 20.

Valuing the Income Stream of Your Landlease Community

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The Higher the Site Rent, the Less Home Buyers Can Buy

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No More on Radical Change for Now; Maybe Next Week!

I.

Two Ways to Estimate the Value of Your LLCommunity’s Income Stream

There’s a longhand way to estimate the capitalized annual net rental income value of any traditional landlease (nee manufactured home) community; and, there’s a shorthand approach for average quality properties alone. Both are income capitalization income valuation methodologies. And for the record, remember; there are two additional traditional income – producing property valuation methodologies: replacement value and market value; neither of which will be dealt with in the following few paragraphs.

Given an ‘average’ LLCommunity with 200 fully developed, rentable, occupied home sites; charging $200/month site rent; experiencing 80% physical occupancy; 40% overall Operating Expense Ratio or OER; and worthy of a 10 cap (i.e. 10% income capitalization rate, ideally based on like property sales in the same local housing market, recently sold); what is the approximate value of that property’s net rental income stream – not considering the sale and or rental of homes, if any, on – site?

The classic longhand method would be to estimate the property’s maximum net rental income stream value first, if viewing as a potential buyer or investor; then ‘run the numbers’ reflecting present physical occupancy level; then, to be even more precise, considering economic occupancy. Here’re three representative sets of numbers:

• 200 sites X $200/mth rent X 12 months X .60 (reciprocal of 40% OER), divided by .10 cap rate, = $2,880,000.00 estimated net rental income stream value of LLCommunity with every site occupied and paying rent.

• 200 sites X .80 (physical occupancy) X $200 X 12 months X .60, divided by .10 cap rate = $2,304,000.00 estimated net rental income stream under present conditions, or $576,000.00 less value than if/when fully occupied.

• 200 sites X .75 (economic occupancy, i.e. # renters actually paying rent) X $200 X 12 months X .60, divided by .10 cap rate = $2,160,000 estimated net rental income stream under present ‘collection conditions’, or $720,000 less value.

Keep in mind; with exceptions of first, the 200 rental homesite count (though that could change), and then 12 months/year (Always best to annualize these calculations), all other factors are ‘variables’ requiring research and documentation before using in the afore – described longhand valuation formula. Two examples: the 40% OER, while widely accepted as the Industry Standard for landlease communities*1, must be ascertained for the subject property; and the ‘cap rate’, while calculated different ways, is often a function of a property’s net operating income (‘NOI’) divided by its’ value (e.g. NOI & sale price at ‘closing’, in the case of a ‘comp’ or nearby comparable property recently sold)*2.

Then there’s a shorthand approach to the afore – described three applications of the net rental income stream valuation formula. Widely known as the New Rule of 72, this methodology is simple, direct, and applies ONLY to average quality landlease communities. Same ‘givens’ as used in previous examples: 200 rental home sites & 200/month site rent, 80% physical occupancy = 160 sites (& 75% economic occupancy = 150 sites), 40% Industry Standard OER, and 10% ‘cap rate’ for an average quality LLCommunity.

• 200 sites X $200 X 72 = $2,880,000.00 estimated net rental income stream value

• 180 sites X $200 X 72 = $2,304,000.00 estimated net rental income stream value

• 175 sites X $200 X 72 = $2,160,000.00 estimated net rental income stream value

It doesn’t get much simpler than that. What is the value of your landlease community’s net rental income stream today? What should it be? What are YOU doing to get it there? For a FREE wallet card containing the long and shorthand valuation methodologies just demonstrated, phone the MHIndustry HOTLINE provided in end note # 1.

Has this question crossed your mind: ‘If this is the New Rule of 72, what’s the Old Rule of 72?’ Fair enough. It’s a simple, longstanding formula used to calculate ‘How long it takes to double the value of an investment at a set ROI (i.e. return on investment).’ For example, the whole number ‘72’ divided by an ROI percentage, e.g. of ‘20%’, equals 3.6 years. Now you know, both the Old & New Rules of 72!

II.

The Higher the Site Rent, the Less Home Buyers Can Buy!

The following paragraphs are quoted from the January 2012 issue of the Allen Letter professional journal. This information is so important and timely, we don’t want to wait even two weeks to get the updated information and figures into your hands and head.

Longtime blog floggers (readers) and Allen Letter subscribers are already familiar with the game changer ‘Ah Ha! & Uh Oh! Worksheet’ created four years ago. What’s it do? “Estimate(s) maximum recommended ‘affordable’ & ‘risky’ purchase prices for new & resale, privately – owned homes of any type, sited on realty owned fee simple with home, or leased – as in a landlease community!” Quoted from form’s heading. In other words, given a prospective homebuyer or household’s Annual Gross Income (‘AGI’); or, the Area Median Income (‘AMI’) for any zip coded local housing market in the U.S., this single piece of paper, with its’ step – by – step center description column and four columnar ‘$ examples’, i.e. home – & – realty ‘affordable’ & ‘risky’ purchase; and, home – in – LLCommunity ‘affordable’ & ‘ risky’ purchase, clearly demonstrates the ‘most home a consumer should buy’, given their annual gross (or market’s median) income, from both ‘affordable’ & ‘risky’ perspectives! No other tool in today’s housing market and realty profession comes close to what this form does for homebuyers and rental homesite lessees, as well as those marketing, selling and financing new and resale homes!

The original ‘Ah Ha! & Uh Oh! Worksheet’ used as a formula starting point, $36,000 AGI and AMI. While this was characteristic of many Midwest local housing markets four years ago, it really was too low for widespread application, even though users are encouraged to use appropriate AGI, when a prospective homebuyer ‘walks in the home sales center door’, or AMI, when considering a new local housing market for opening a new home sales center. In any event, a new, slightly revised edition of the ‘Ah Ha! & Uh Oh! Worksheet ‘begins’ with an AGI/AMI of $51,229, the approximate national AMI for years 2010 & 2011. How does this new and higher figure ‘pencil out’ when running the numbers through this multipurpose form? For the purposes of this week’s blog posting, we’ll deal only with the ‘affordable’ & ‘risky’ perspectives of home buying and rental homesite leasing in typical landlease (nee manufactured home) communities.

“ ‘As Rental Homesite Rates Rise, the Price/Value of Homeowner/site lessees’ Home Goes Down!’ No real surprise there. That’s a well recognized logical truism around the MHBusiness. Here are the numbers! Given the above – referenced starting point of $51,229 AMI or AGI, and three rental homesite rates at $133/month, #333/month, and $533/month; and using said ‘Ah Ha! & Uh Oh! Worksheet’, here’re the corresponding maximum ‘affordable home prices/values for those three site rent rates consecutively: $98,649 max, slipping down to $75,000., then down further to only $50,968. In other words, for every $200 in rent increase (between $133 & $333 & 533), the maximum ‘affordable’ home price/value plummets by about $24,000! Bottom line? Given that $51,229 is the approximate national AMI, and average national rental homesite rate is near $333/month, then a $75,000 price/value new or resale manufactured home is affordable and ‘doable’ in the average landlease community! However, if site rent is increased to $533/month in a market where AMI is anywhere near $51,229, that homeowner/site lessee who could have bought a $75,000 home, I now only able to purchase one for $50,968 – assuming he/she does to in an ‘affordable’ fashion, and NOT as a ‘risky’ deal characteristic of the late 1990s. FYI. The ‘risky’ home price/value figures here, for $333/month & $533/month site rents are $101,666 and $80,210 respectively. Impressive yes, but remember: The ‘risky’ route is no picnic, as the utility bills included in the ‘affordable’ PITI (i.e. principal, interest, taxes, insurance) monthly house payment, still have to be paid each month, but now ‘in addition to’ the home loan payment of just PITI alone.” Quoted from the Allen Letter professional journal (1/2012)

Want a FREE copy of the aforementioned and slightly revised ‘Ah Ha! & Uh Oh! Worksheet’? Simply phone the MHIndustry HOTLINE listed in end note # 1.

III.

No More on Radical Change for Now; Maybe Next Week!

Will tell you this much though. Email and telephone responses to last week’s blog posting: ‘More Than One Way to Implement Radical Change…’ was near immediate, pouring into my laptop and our offices within one half hour after I completed the posting process. And so far, with one exception (A reader/writer misunderstood, thinking I was ‘looking for a job’ – Which I Am Not!), many of YOU out there, are fed up with the perennial inter association politicking, bickering and marginalized industry advocacy in our nation’s capitol (Think S.A.F.E. Act & Dodd – Frank regulatory ‘surprises’ in 2010 & 2011); and on the landlease community side of the house, apparent inactivity, lack of direction, and paucity of communication with direct dues – paying members. Hence, widespread but tacit support for Radical Change of some sort….

Again, I am not looking for a job! Rather, I’m seeking a practical and lasting means to continue producing, preserving, and carrying forward the sort of practical knowledge contained in parts I & II of this week’s blog posting.

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End Notes.

1. For a FREE copy of the Industry Standard Chart of (Operating Expense) Accounts, along with appropriate line item OERs, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, and request it.

2. Capitalization rate. Also referred to as cap rate or income yield. The lower the cap rate (e.g. 8% cap rate is lower than 12% cap rate), the higher the risk to the investor (i.e. To realize his/her ROI, or return on & of, a higher priced investment), hence a higher asking price. From Dictionary of Real Estate.

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156 & gfa7156@aol.com

More Than One Way to Implement Radical Change…

I.

As a Major Paradigm Shift, Belatedly Effecting National Advocacy Change,

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Now’s time for this 60 year ‘double dual industry’, broadly comprised of

1) manufactured housing fabrication & distribution segments, and

2) landlease community developers, investors & managers,

to maybe ‘leave the MHI home’ and go their separate ways. Can YOU think of any other U.S. industry, where the product manufacturing and sales business model shares the same national political and regulatory advocacy presence with their commercial, wholesale, and retail customers? No? And that forced intimacy, as we know from history, makes for a fertile breeding ground for collusion on one hand (Think questionable chattel lending practices circa 1978 & 98) and conflicts of interest (Relative to land zoning perspectives), on the other!

Or simply,

The pronouncement of a ‘third choice’ national advocacy alternative for manufactured housing purists, landlease community owners, and everyone else in today’s MHIndustry and LLCommunity asset class.

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Nature of paradigm shift, radical change, third choice advocacy alternative?

First; one more time, review the present day status quo and previously recommended Radical Change at the Manufactured Housing Institute, proposed and described here, during the past several weeks:

• “A Congressional hearing takes place in late November 2011 in Virginia, and there’s no salaried spokesperson or advocate testifying in behalf of the Manufactured Housing Institute. MHI’s annual meeting takes place in Phoenix, AZ., earlier this Fall. Since then, there’s been little communication to direct, dues – paying members by its’ National Communities Council division, including follow – up of matters (e.g. CAS Task Force & more…) discussed at said meeting. And during a recent conference call with state manufactured housing executives, MHI’s chairman indicated there’s no rush to find a replacement for Thayer Long. That’s a brief summary of this industry observer’s ‘grassroots constituency view’ of manufactured housing (MHI) and landlease community (NCC) national advocacy to date. In other words, National Advocacy Choice # 1 = Maintain the status quo.” (Edited. GFA) Also probably why, for the first time since this weekly blog appeared 170 editions ago, some of its’ more than 500 readers have started calling and writing, asking, ‘Will MHI will be in business by year end 2012; and, whether they should pay dues this next year?’

• “…on 13 November 2011, this weekly blog posting proposed a Radical Change at the Manufactured Housing Institute. To wit, “Finally merge a renamed Manufactured Housing Association for Regulatory Reform (a.k.a. MHARR) with MHI, yes indeed, and make Danny Ghorbani executive – in – charge of all home manufacturing/distribution matters, and yours truly, George Allen, executive – in – charge of all landlease community owner/operator affairs!” In other words, this National Advocacy Radical Change = Choice # 2. (Edited. GFA). As a related aside, one has to wonder what the answer(s), and advocacy results, might have been, IF indeed, MHI’s elected leaders had made a serious overture to Mssrs. Ghorbani & Allen.

Since there’s been no recent encouragement from MHI’s elected and salaried leaders, that status quo choice # 1 will markedly improve during the weeks and months ahead; and, there’s been no interest expressed in pursuing National Advocacy Change, Choice # 2, by the same parties (With one marked exception), the stage is effectively set, and door opened wide, to introduce National Advocacy Radical Change, Choice # 3.

National Advocacy Radical Change, Choice # 3?

HUD Code home manufacturers who design and market a line of modular homes, might join the Building Systems Council (‘BSC’) of the National Association of Homebuilders (‘NAHB’). This is not without precedent. Champion Homes’ Genesis (modular homes) division already belongs; and, Clayton Homes, as well as Palm Harbor Homes (now part of the Cavco Industries family of companies) are past members of NAHB’s BSC. However, this alternative would leave ‘HUD Code only’ firms adrift and alone. A better alternative, in my opinion, would be for all HUD Code manufactured housing producers, large and small, to affiliate en masse, with a renamed Manufactured Housing Association for Regulatory Reform (‘MHARR’), to henceforth effect a stronger and united national advocacy presence relative to all manufactured housing PRODUCTION matters politic, and regulatory affairs.

Who knows? Maybe after 11 long years, we might see the Manufactured Housing Improvement Act of 2000 (a.k.a. ‘MHIA@2000’) finally fully implemented over HUD’s perennial resistance to our industry’s heretofore conflicted status quo national advocacy efforts.

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At the same time, either reorganize the Manufactured Housing Institute as a national POST PRODUCTION advocacy body, sans all HUD Code home manufacturers, henceforth focused on the needs and wants of ALL other segments of the manufactured housing industry, possibly including the landlease community real estate asset class.

OR, if indeed, the timing and motivating circumstances are now right and compelling,

Birth a new realty – based national advocacy ( & more) body, similar to the NAR, IREM, BOMA, NAA, NMHC, CA, CIREI, C of RE, REEA, NAREA, etc., to represent and advocate in behalf of 50,000+/- landlease communities, and their owners/operators, nationwide. And while at it, broaden that new body’s scope of products and services to include statistical research and reporting; weekly online and monthly print communication with members; viable and economical professional property management training and certification; an annual International Networking Roundtable event; periodic, confidential FOCUS Group meetings for top executives; as well as, preparation and distribution of key resource documents and directories long utilized, though heretofore prepared commercially, by individual and portfolio landlease community owners/operators nationwide. This would indeed be the welcome, needed, and long awaited dawning of a new and exciting day, decade, and future for landlease (nee manufactured home) community developers, investors, professional property managers, even the asset class’ homeowner/rental home site lessees!

The remaining segments, including state manufactured housing associations? That’d be a matter, as suggested earlier, best addressed by the reorganized MHI; or if need be, the new landlease community national advocacy and research/resource body.

The matter frankly, is almost as simple and straightforward as just described. Probably the biggest considerations, next to deciding on a national headquarters location, will be, ‘What to do with the annual Manufactured Housing Congress in Las Vegas, Nevada, each Spring?’ And, ‘How to best handle Washington, DC., lobbying in behalf of landlease communities and non – manufacturing segments of the manufactured housing industry?’ Yes, there’ll be a myriad of additional details to address, while implementing this paradigm shift, radical change, third choice national advocacy alternative. But what other ‘real choice’ do we have today? The status quo? Really?

With that said, what’s the next step in this radical change process?

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SUGGESTION. Print off & SAVE this ‘Radical Change Implementation’ blog posting for reference, during the weeks, maybe months ahead.

And remember, your input on this timely matter, and others, is requested, respected, and greatly appreciated! Correspond in confidence via: gfa7156@aol.com or phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 or write to GFA c/o Box # 47024, Indpls, IN. 46247.

*****

II.

Maybe More Chattel $ for in – Community Home Deals

Remember awhile back, when the BEBA (Blast Email Blog Alert) message introducing that week’s blog posting, hinted at a new source of chattel capital for in – landlease community new home sales transactions? Well, progress is being made in that direction and to that end. Hopefully, in a few weeks or longer, we’ll announce the nature and launch of this new radical change (improvement) partnership, addressing the need to self – finance new home transactions and stimulate factory production and shipments.

*****

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

Two New Trends; & a Watershed Year for MHAdvocacy?

I.

Two New Trends to Watch….

The manufactured housing industry and its’ counterpart, the landlease community real estate asset class, have been awash in new tends and retread trends, for much of the past decade. Why? HUD Code annual shipment levels of new homes have slipped precipitously from 372,843 in 1998 to only 50,000+/- in 2008, 2009, 2010, and 2011; taking landlease (nee manufactured home) community occupancy, in part, along on the slide. These new and retread trends include, but are not limited to…

• Percentage of new multisection manufactured homes has decreased as volume of new singlesection manufactured homes has increased

• Percentage of land – and – home packages (i.e. manufactured homes installed on building sites conveyed fee simple) has decreased, and volume of landlease community infill homes has increased

• (Larger) Developer Series Homes characteristic of manufactured housing’s 1990s heyday, have been supplanted by smaller Community Series Homes or ‘CSH’, to support landlease community infill.

• Landlease community occupancy declines as ‘(home) deals of convenience’ are repossessed, and other residents’ lives suffer during the national economic slump

• Landlease community (property owner) self – finance methodologies of ‘buy here – pay here’ (circa 1970s) and ‘captive finance’ (circa 2000s), now supplemented with the lease – option alternative, and increasing presence of ‘rental units’ (both circa 1970s practices), as the S.A.F.E. Act and Dodd – Frank Bill underscore importance of chattel lender (LLCommunity owner) compliance with strict financial regulations.

• Manufactured home communities now called landlease communities, as two traditional housing types (e.g. pre – HUD Code ‘mobile homes’ & HUD Code manufactured homes) are joined on – site by increasing numbers of modular homes, park model RVs, ‘RVs for a season’, even stick – built homes designed and constructed to look like neighboring HUD Code homes.

Again, this is a partial list of contemporary trends that could be listed here, but you get the idea. So, what’s happening anew now? Two new trends to watch….

TREND # 1. Quiet tenant and social activism within, and on the perimeter of, the manufactured housing industry and landlease community real estate asset class.

Four trend indicators were described by Ms. Carla Burr on 29 November 2011 in Danville, VA., at a Hearing on the State of Manufactured Housing, before the Subcommittee on Insurance, Housing, and Community Opportunity, of the Financial Services Committee, House of Representatives (Congress), cited by her as being

“…promising signs to support affordable housing through manufactured housing.”:

• “The establishment of the Manufactured Home Owners Association of America (‘MHOAA’), of which I am a member. Nearly 20 state organizations exist representing community residents. The goal is to have all 50 states organized to become member states.”

• “The Corporation for Enterprise Development (‘CFED’) developed the Innovations in Manufactured Homes Initiative (‘I’M HOME’) to ensure families who purchase manufactured homes reap benefits from the homeownership experience that enable them to live safely, securely and affordably and to build wealth.”

• “Resident Owned Communities USA (‘ROC-USA®’) has put together the financing and the technical assistance to enable residents of communities to buy the land, and run the community cooperatively. If I could, I would buy my plot of land in a heartbeat! This would convert my home to real estate and my taxes would change from personal property to real property; the high lot rental would be eliminated, thereby putting more money in my pocket.”

• “Next Step ™ is building a national network of nonprofit affordable housing developers to replace pre – HUD Code manufactured homes with new ENERGY STAR manufactured homes through a partnership with my fellow panelist, Clayton Homes.”

STOP HERE, and reread that four part description of this ‘quiet tenant and social activism trend’ already affecting the manufactured housing industry and landlease community real estate asset class.

NOW ASK YOURSELF these questions:

• Has MOAA come to my local housing market yet? Are there aspects of my present landlease community operation that would attract this sort of activism cum landlord – tenant legislation? Are my rental homesite rates in sync with other multifamily rental properties in my local housing market? Do I know for sure? To find out, phone me via MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

• Should I be learning more about the CFED & ‘I’M HOME’ programs. What are my national and state advocacy bodies (i.e. Manufactured Housing Institute & its’ National Communities Council division, for starters) telling me about these; and are they opportunities or threats? Phone MHI @ (703) 558-0400 & NCC @ (703) 558-0666 to request information.. Not a direct, dues – paying member? Become one!

• Is tenant or resident ownership of my/our landlease community(ies) a viable and or desirable consideration at this time, or in the foreseeable future? To learn more about the ROC-USA program, contact MHI member Paul Bradley via (603) 856-0709.

• And, what is Next Step ™ all about? For the manufactured housing perspective on this subject, ask Kevin Clayton @ (865) 380-3000

Lest you think, for even one minute, that any of the preceding is wishy washy consumer posturing, read the following from Ms. Burr’s testimony at the Congressional hearing:

“I love my home. I just made a mistake when I moved into a manufactured housing community, or park. (While) about 2/3 of manufactured homes are placed on land owned or controlled by the home buyer, but (sic) 1/3 of the homes are placed on land leased. Nationwide, there are 50,000 (landlease) communities. Some are wonderful with respectful land owners who maintain high quality and keep prices affordable.”

HOWEVER

“Then there are communities like mine. Established in 1972, there are 499 homes in my (Virginia) community. Unfortunately, many of us feel trapped. We each spent tens of thousands of dollars to buy our homes, yet the lot rent has increased exorbitantly. Next year, my lot rent is going to be $919.00 a month. Seven years ago, the lot rent was about $400.00. We have no control over the lot rent. If we don’t want to pay it, one would expect we could pick up our homes and move, but that is out of the question. Moving my home would cost about $20,000. There is also simply nowhere to move. There are no (landlease) communities near me and I cannot afford to buy land.”

Pretty sobering picture of the near rapacious state some large income – producing properties have gotten themselves into of late.

But the bigger question is, ‘How does’ and or ‘how will’ this quiet tenant and social activism trend potentially affect your manufactured housing business and or landlease community operation? You owe it to yourself and your business interests to ponder….

TREND # 2. This is a two part complementary trend, where 1) ‘Park model’ production might spell manufactured housing survival in the short term, and factory – built housing industry success in the long term. And, 2) Is ‘RV park development and investment’ the landlease community business model of the future? Appears to be so, for now, in local housing markets where new oil/gas resources are being accessed and readied for market.

In the first instance, the following quotes are from a story titled ‘Cavco Industries Expands Reach to Industry Shows Across the U.S.’, in the December 2011 issue of Woodall’s Campground Management newspaper.

“…with its’ recent acquisition of Fleetwood Homes and Palm Harbor Homes, Cavco now has more production facilities than any other company in the park model business.”

“Combine multiple factory locations with Cavco’s increasing innovations in park model designs, which now include off – grid solar – power park models…and its’ easy to see how Cavco has managed to achieve at least modest sales growth at a time in which most companies continue to struggle with the recession.” For that matter, who isn’t building park models these days?

“…Cavco has derived much of its’ park model business from campgrounds…the company is also seeing renewed signs of interest from consumers who want to purchase a park model and have it set up in a campground for use as a weekend retreat or vacation cottage.”

What’s not pointed out in the article, for an obvious reason*1, among knowledgeable housing professionals, is that an increasing number of park models (a.k.a. ‘park model RVs’ mentioned earlier in this blog) are being sited in landlease communities as seasonal, and in many instances, year round housing. For that matter, in Sunbelt regions, entire landlease communities (a.k.a. RV parks) are comprised of park models and other types of recreational vehicles.

But now, for the first time outside Sunbelt regions, RV parks are being approved for land development in areas where oil/gas resources are being tapped in Canada and the U.S., to address our nation’s energy challenge, on the one hand; and, severe worker housing shortages on the other. It’s generally easier and cheaper to build high density (Given 400 square foot smaller size of ‘park model RVs,’ than much larger manufactured homes, CSH models notwithstanding) RV parks, than landlease communities characterized by five homes per acre.

Will this landlease (RV parks) community trend continue to grow, and more importantly, expand into other, non oil/gas resource areas? Too early to tell just yet. But some veterans in the MHBusiness already point out how ‘mobile homes’ of the 1960s were similar in size to today’s park model RVs – earning then, the ‘most affordable housing alternative’ sobriquet for the manufactured housing industry. Are today’s home buying consumers, however, ready to buy such small housing en masse. It’s highly doubtful. But the estimate remains; there’re 250,000+/- vacant rental homesites throughout the U.S. at this time, among the estimated 50,000+/- landlease communities. And frankly, the likely majority of this quarter million sites is functionally obsolete (i.e. too small a footprint, in size, to site today’s behemoth multisection manufactured homes, even many of the smaller, specially – designed singlesection Community Series Homes. SO, ‘park models’, ‘park model RVs’, ‘granny flats’, even ‘accessory dwelling units’ or ADUs (per HUD), irregardless of how one refers to them, represent a viable, contemporary factory – built housing alternative, despite the one aforementioned caveat.*1

End Note 1. Factory – built structures of 400 square feet in size, or smaller, not subject to the infamous HUD (building) Code.

***

II.

Year 2012; a Watershed Year for Manufactured Housing?

(Go ahead, look up ‘watershed’. What follows will make more sense to you)

No big pronouncement in the paragraphs to follow, simply a restatement of where we’ve been in terms of national industry advocacy, and what our two choices are to date, with a hint of one more choice to come.

A Congressional hearing takes place in late November, and there’s no salaried spokesperson or advocate present from the Manufactured Housing Institute. MHI’s annual meeting takes place in Phoenix, AZ., early this Fall. Since then, there’s been little communication to direct, dues – paying members by its’ National Communities Council division, including follow – up on matters discussed at said meeting. And during a recent conference call with state manufactured housing association executives, MHI’s chairman indicated there’s no rush to find a replacement for Thayer Long. That’s a brief summary of this industry observer’s ‘grassroots constituency view’ of national manufactured housing and landlease community advocacy to date. In other words, national advocacy choice # 1 = Maintain the status quo.

As YOU know, on 13 November 2011, this weekly blog posting proposed a Radical Change at the Manufactured Housing Institute. To wit, “Finally merge the Manufactured Housing Association for Regulatory Reform (a.k.a. MHARR) with MHI; yes indeed, and make Danny Ghorbani executive – in – charge of all home manufacturing/distribution matters, and yours truly, George Allen, executive – in – charge of all landlease community owner/operator affairs.!” That, in other words, is national advocacy choice # 2. Radical Change at the Manufactured Housing Institute.

Response to date? Same as we told you last week, dozens of telephone and emails (i.e. copies of original emails, sent to one or more of five leaders listed at the end of the 11/13/11 blog posting) expressing agreement and encouragement, from all segments of the manufactured housing industry and landlease community asset class – and one direct response from one of the those five ‘leaders’.

But that’s OK. Why? Two reasons. If and when MHIndustry business owners decide en masse they want to improve the manner by which their commercial interests are advocated in Washington, DC., it’ll happen! And, proposing a Radical Change at the Manufactured Housing Institute, for national consideration and discussion, sets the stage and opens the door to an Even More Radical Change not yet described. And when the time is right, that too will be pronounced!

***

George Allen, CPM®Emeritus & MHM®Master
Consultant to the Factory – built Industry &
The Landlease Community Real Estate Asset Class
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

Bound & Determined to Begin This Blog with Fun Information!

This may not be the newsiest summary you read this week, but there’s ‘takeaway’ value here to apply to your unique business interests; before we return to ‘What’s happening & Not been happening’ in the MHIndustry.

I.

Earlier this year I was hired by Marcus & Millichap (Our asset class’ largest national realty brokerage of landlease communities) to address their brokers about, you guessed it, landlease communities. I began my remarks with a recitation of some of the most unusual and interesting properties I’ve visited during the past three decades, along with some of my most unusual freelance consulting assignments.

First there was the landlease community – based nudist colony in central Canada; then two gypsy family – owned conclaves in South Carolina and Arizona; even a ‘biker hangout’ in central, Florida. Ever visit a several hundred site ghost LLCommunity, where every fully – developed rental homesite, complete with utility risers and paved off street parking, is vacant and overgrown with high grass and the like? Gives one an eerie feeling. And some say there are no $1,000.00 per site ‘deals’ to be had these days, like the LLCommunities I acquired in the early 1980s. Well, within the past six months, one 50 site, management – challenged property, 100% occupied with (mostly) rent paying homeowners, went for $40,000.00 cash. I’m confident there’re additional investment opportunities like that ‘out there’.

My most unusual management consulting assignments? An in – person damage assessment of several large landlease communities in Homestead, Florida, the day after Hurricane Andrew, 20 years ago. We have stunning photos to prove it; showing single section manufactured homes stacked atop one another like cord wood, and tall pine trees with 24” diameter trunks stripped of all their limbs and needles! Then there was the time I quietly terminated a volatile, but otherwise competent community manager, after he threatened to kill the tight – fisted, out of state property owner. How’d I do it? Got the manager a similar job, the next day, in another state, managing a 100% ‘rental home’ LLCommunity. And he remains on the job to this day.

Most unusual International Networking Roundtables during the past 20 years? There was a string of ‘em, beginning in 1999, in Colorado Springs. During the final night of the event at the Marriott Hotel, five feet of snow fell (Turned out to be the heaviest pre – season snowfall on record for the area!) paralyzing the city and transportation for three days. We all helped shovel snow, took our meals in the lobby of the hotel, and lived to tell about it! The very next year, 75 of us faced – down Hurricane Georges, at another Marriott Hotel, this time on Florida’s East coast, at Delray Beach. As the hurricane roared outdoors, we hardly noticed it inside, except for when swinging one’s feet out of bed in the morning, onto a water soaked carpet. The very next year, the Tragedy of 9/11 forced postponement of the Roundtable until November, with an even larger number of registrants showed up at the event in Chicago. Then, the following year in 2002, we had a commitment from President George W. Bush’s liaison staff, for him to maybe briefly visit the 11th annual Roundtable – acknowledging previous year’s Roundtable attendees convening despite the threat of international terrorism; this year’s event held on the Gulf coast in St. Petersburg Beach, Florida. At the time, President Bush was planning to be in town to play golf with his brother Jebb, then governor of Florida. Extra security was already in place at the host hotel, to accommodate a convention of Florida Judges. And we tentatively reserved the presidential suite at nearby Hotel Don Cesar. But, at the last minute, the first Afghanistan conflict heated up, and his trip to Florida was canceled; so, no very special appearance. Now there were four successive years to remember!

How ‘bout some Lessons Learned during the last the last four plus decades, as a young Marine officer, lumberyard supervisor, property manager, business entrepreneur, management consultant, newsletter writer, book author and MHIndustry publisher.

• KISS principle = Keep It Simple Stupid – or Sweetheart, depending on audience.
• 6 – P Rule of Planning: ‘Proper Prior Planning Prevents Poor Performance!’
• SMEAC. Military abbreviation for the management process: Situation, Mission, Execution, Administration & Logistics, Command & Communication.
• ‘Don’t expect anything of your men (Marines) you wouldn’t do yourself!’
• Use of homemade, laminated ‘wallet cards’ containing vital info & procedures
• ‘Praise in pubic, criticize in private; &, Ask, don’t tell, & keep ask out of trouble!’
• ‘Be firm but fair!’ in work environments, add ‘diplomatically’ in property mgmt’
• ‘No one really cares whether you succeed or fail in business, except you and your spouse or significant other!’
• Need to ‘hustle’ (new business) is challenging, fun, frustrating & rewarding; as ‘coasting’ allows time to reenergize & enjoy the fruit of one’s labors – for awhile.
• Definition of profit? The reward for taking risks!
• Maximum income & minimum expenses = best return of & on one’s investment!

For many more personal and business truisms, along with reproductions of several copyrighted Management Wisdom wallet cards, read Chapbook of Business & Management Wisdom, PMN Publishing, 2008. Don’t miss the chapter titled: ‘Scintillatingly Salient – but – Salacious Secrets to Business Management Consulting Success….’ Available via MHIndustry HOTLINE: (877) MFD-HSNG or 633.4764.

II.

Now, that update re status of critical MHIndustry matters parsed in recent blog postings:

• ‘Time for a Radical Change at the Manufactured Housing Institute’ debuted 13 November 2011. Everyone in the MHBusiness knows national manufactured housing advocacy is anemic at best, given the perennial ‘He said’ – ‘She said’ Abbott & Costello politico – comedy routine, betwixt MHI & MHARR. Said Radical Change Proposal put ‘all things manufactured housing production & distribution’ under Danny Ghorbani, and ‘all things landlease community’ under George Allen, ‘all in one national advocacy body’! Response to date? Substantial email and telephonic support of the proposal (See end note # 1), but abject silence from all but one industry leader! However, this was expected! How so? Just this past week, a staffer at one of the national advocacy bodies commented, ‘Oh we don’t pay any attention to the manufactured housing industry press’, or words to that effect. Surprised? I’m not. The offhand comment simply underscores an ongoing shortcoming.

Anyway, the aforementioned Radical Change Proposal, given continued disregard, simply clears the way for an even more far – reaching alternative, that will qualify, if and when made public, as the largest of all paradigm shifts in the history of the manufactured housing industry and landlease community real estate asset class! One might even be wont to say, ‘This is really the only option remaining for this industry, so set in its’ ways, it refuses to consider modifying its’ business model to remain viable and survive!’ Keep reading here….

• The MHInitiative® successor to the National State of the Asset Class (‘NSAC’) series of caucuses originating in 2008 and 2009. Not much to be said here now, about the tentative national meeting for manufactured housing industry businessmen and women owners, scheduled on or about 27 February 2012, ‘somewhere in the South.’ The original list of 100 MHInitiative® supporters continues to grow in number each week. It’s so obvious grassroots stakeholders, from all segments of the manufactured housing industry and landlease community real estate asset class are ‘more than anxious’ to caucus at a national brainstorming session among peers with ‘the most to lose, to identify one or more solutions to our industry and asset class’ present state of malaise. Are YOU one of these? If so, let me know via gfa7156@aol.com

• MHI’s ‘water sprinkler’ proposal to the Manufactured Housing Consensus Committee or MHCC. Despite exposes in this online media outreach, and reader communiqués to MHIndustry leaders; to the best of my knowledge, there’re
no regrets, no recall, no nothing, afoot to modify the proposal, that in the minds of many LLCommunity owners, potentially puts our properties and livelihoods at risk of increased liability and decreased marketability, when water sprinkler – equipped homes seek installation on vacant rental homesites in our LLCommunities oft served by water lines not designed, and perhaps incapable of servicing greater water pressure and volume requirements pursuant to fire suppression. This is likely the last word you’ll read here about the matter. It’s
now in your hands, if you own and or manage landlease communities.

• Demise of manufactured housing (vehicle) titles & possible supplanting with recorded (realty – type) deeds, may well result in higher homeowner taxes for landlease community residents, beginning in Illinois, Missouri, Ohio, Alabama, Mississippi, Virginia, and Maryland – the initial seven states targeted by the Uniform Law Commission. More information as details become available.

End Note. *1. These unsolicited quotes from blog floggers (readers) at this website:

“WOW! Good Stuff. I agree. This is a marvelous idea. Danny Ghorbani is the right man! You would be great as director of all (landlease) community owner affairs (except for your slanted view of MHRetailers). I would vote for and support this Radical Change (at the Manufactured Housing Institute).”

“As an active participant in our (manufactured housing) industry for almost 30 years, including membership and board and officer positions in the __________Manufactured Housing Association, and membership in MHI and its’ NCC, I feel the proposal by George Allen to merge MHI and MHARR should be given serious consideration. Mr. Allen’s experience with landlease communities would very nicely complement Mr. Ghorbani’s experience with manufacturers and national regulatory issues. I would be glad to elaborate on this endorsement if you like.”

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

Top Ten Tongue – in – Cheek Reasons NOT to Effect Radical
Change at the Manufactured Housing Institute!

&

Who Might Lead the New MHI Partnership Team?

&

Commentator Paul Harvey & MHI’s ‘water sprinkler’ Proposal

&

Beware the Uniform Law Commission’s Ousting of MHTitles!

The lead story in this week’s blog won’t make sense to you, until you read last week’s posting, titled: ‘Time For a Radical Change at the Manufactured Housing Institute’. Here’s the statement that got tongues – a – wagging during the past seven days…

“Finally merge the Manufactured Housing Association for Regulatory Reform with the Manufactured Housing Institute; yes indeed, and make Danny Ghorbani executive – in – charge of all home manufacturing/distribution matters; and yours truly, George Allen, executive – in – charge of all landlease (nee manufactured home) community affairs! And atop the new HUD Code manufactured housing and landlease community pyramid, position the present day board chairman (Joe Stegmayer of Cavco Industries, Inc.) – or his handpicked designee, to lead both major segments of the new and equal partnership between ‘production & post production’ divisions of the manufactured housing industry.

Present state of the search? Following is from the written and distributed record of MHI’s conference call, 15 November, with state MHAssociation execs. At one point, Joe Stegmayer explains: ‘We have talked with some folks and are getting resumes in for a new president…We want to find a very dynamic and aggressive leader for MHI… (&) We don’t feel we have to have a person in (sic) tomorrow.’

Last week’s blog posting. ‘Thanks’ to those who’ve taken time to email your thoughts, on this matter, to one or more of the five MHIndustry leaders listed at the conclusion of said blog posting. Now, onto the…

I.

Top Ten Tongue – in – Cheek Reasons NOT to Effect Radical Change at MHI!

1. Oil (MHI) and water (MHARR) simply don’t and won’t mix, ever, ever, ever!

2. Radical Change, frankly, is something ‘We don’t do at MHI’; it hurts too much.

3. At heart we’re trailer folk, so don’t deserve prosperity and all its’ trappings.

4. Danny Ghorbani’s 43 years of manufactured housing experience is not enough!

5. George Allen has but 33 years of landlease community experience & needs more!

6. LOL: “OMG, I’ll die B4 using Allenisms like MHIndustry & LLCommunity.”

7. In partnerships, someone always gets screwed; the one with the idea, one with the money; or other way around? Will it be production, post production, or neither?

8. Consensus building & issue confrontation are mutually exclusive advocacy tactics, and ‘never the twin should meet’ in one manufactured housing trade body!

9. “Oh no! We’ll have to combine the ‘How to Save Our Industry?!’ MHInitiative ® & MHI’s legislative meeting, both are scheduled for 27 February 2012.” Horrors.

10. Our friends, ‘the politicians, and regulators at HUD’, won’t know how, or who to ignore, when we cease advocating via ‘MHI said’ versus ‘MHARR said’ opining!

Know what? While couched as tongue – in – cheek, there’s real truth within each and every one of those Ten Reasons NOT to Effect Radical Change at MHI! Some examples:

No one has seen MHI & MHARR ‘work well together over time’; that’s why we need one overarching national trade body, well representing all segments of the MHIndustry!
Or, once again, failing this radical change….

Yes, change often does hurt, and radical change more so. But so does childbirth and….

We’re way past time to segue from ‘trailers’, to being conventional affordable housing!

76 years is more than double the total length of employment of MHI’s last four presidents

Can I help it if some ‘talk funny’ is an effort to scribe more substance with fewer words?

Partnership caution is accurate, but they also work well; as with my 30 year business one!

Consensus building & issue confrontation, as in good cop – bad cop, can work together

It shouldn’t take something like the MHInitiative® to get radical change moving, but…

It will be a welcome change, to see politicians & HUD regulators, twist in their own wind

See what I mean? How can YOU; how can our salaried and elected leaders at the national trade body level, not want to effect ‘Radical Change at the Manufactured Housing Institute’, when there’re so many very good reasons for doing so NOW?!

II.

Who Might Lead This New Partnership Team?

This is a tricky journalistic juxtaposition to articulate effectively. Huh? Well, you see, I haven’t reached out to any of these individuals – and they do all happen to be male, I’ll give you that much – to learn if they’d even be interested in being, in effect, the ‘business savior of the manufactured housing industry’. So, with that caveat in mind – and the knowledge that ‘to a man’ they’re successful, MHExperienced, even a role model association exec; all who’re, in my opinion, well – qualified to be MHI’s board chairman’s ‘man in Washington, DC’. Here’re your hints:

• Acclaimed by many, as the most visionary factory – built housing producer ever; equally comfortable fabricating modular, HUD Code, and other types of housing.

• Most veteran of all landlease community owners in private and public sectors.

• Widespread, earned reputation as ‘association executive’s association executive’.

• ‘Dark horse’ of manufactured housing, with 40+ years of national assn. expertise.

But know what? Given our industry and asset class’ long and earned reputation for in – fighting amongst ourselves, and perennial resistance to change from ‘both within & without’ the production and post production segments of manufactured housing, it’ll take someone – possibly not anyone on the above list, willing to risk their good reputation to take on ‘Radical Change at the Manufactured Housing Institute.’ No question about it; this will not be an easy job, and getting the strong personalities recommended to run the ‘two sides of the house’, to work effectively together and with MHI membership, will be daunting at best, maybe impossible, at worst. But is there another practical answer to ‘Save Our Industry?!’ I think NOT, but if you think SO, now is the time to step forward to be heard, and make your suggestion(s) known! Otherwise, we’ll talk about it at the MHInitiative® in 2012.

How to be heard? Respond to either this blog posting, via gfa7156@aol.com or the only MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, or correspond to GFA c/o Box # 47024, Indpls, IN. 46247. Or frankly, scroll back to last week’s posting in this website’s blog archive, to ‘Time for Radical Change….’ and send your email comments to one or more of the five MHIndustry leaders listed at the very end of said posting. Also, contact executives at MHI (703) 558-0600 or MHARR (202) 783-4087 directly.

III.

Late Commentator Paul Harvey, & MHI’s ‘Water Sprinkler’ Proposal to the MHCC

Like me, you probably miss hearing the late Paul Harvey say, at the end of his radio stories, “And that, my friends, is the Rest of the Story!” Well, it appears we have a Paul Harvey – like story developing within the manufactured housing industry and landlease community realty asset class. If you’ve been reading this blog during the past several weeks, you already know of the Manufactured Housing Institute’s proposal, relative to ‘water sprinkler’ installation in new manufactured homes, offered to HUD’s Manufactured Housing Consensus Committee (‘MHCC’).

MHI’s commentary to date has related solely to the effect said proposal might have, and might not have, relative to manufactured housing’s present federal preemption and local building codes. See MHI’s VP Lois Starkey’s article, on the subject, in the current issue of the NCC’s Community Connections Fall newsletter. And this from the aforementioned written record of MHI’s 15 November conference call with state MHAssociation execs: “Fire (sic) sprinklers. The MHCC voted on this and a proposal was put forward to HUD that they much change their pre – emption policy on fire (sic) sprinklers. Fire (sic) sprinklers should not be required. Some local governments have acted in the absence of HUD not acting.”

But there may be more to the situation than what’s being publicly addressed by MHI and it’s National Communities Council (‘NCC’) division. What is a landlease community owner to do, in the foreseeable future, if and when a ‘water sprinkler’ equipped manufactured home arrives on – site to be installed, and it turns out the underground water supply system, by dint of design and or age, is undersized and unable to support the emergency need for greater water volume and pressure, in the event of a fire in this fire suppression – equipped home? Think about it. Apparently no one else is….

Why? There’re several possible reasons little – to – nothing is being said or done, within the MHI/NCC ‘family’, to retract this short – sighted ‘water sprinkler’ installation proposal to HUD’s MHCC:

• One maybe has to do with quiet proprietary desire, or even need, on the part of one or more home manufacturer(s), to ship new manufactured homes into local housing markets, mainly out West at present, where in – home water sprinklers are already mandated by local building codes.

• Another maybe has to do with executive property managers in leadership positions, not rocking MHI’s PC (‘political correctness’) boat; in effect, disregarding landlease community owners’ concern about future liability if their property(ies) infrastructure is unable to support homes equipped with fire suppression systems requiring greater water pressure and volume than normal.

• Another maybe has to do with property owners and investors who plan to divest themselves of their landlease community(ies) assets in the near or not too distant future, hence avoiding this potential liability issue altogether.

At this point, I’ve done all I can do to bring this matter to your attention. Anything further will have to, evidently, come from the grassroots of the MHIndustry & LLCommunity asset class, most likely via state MHAssociations affiliated with MHI and it’s NCC division. I’ve already corresponded, as a direct, dues – paying member of the NCC, and as an NCC board member, but have been stonewalled in this manner:

“Thayer responded to you at the end of October with MHI (sic) position and an update.”

True. But neither Thayer’s response or subsequent update, acknowledged the ‘water sprinkler’ proposal’s potential to increase LLCommunity owner liability in the future.

IV.

Beware the Uniform Law Commission’s Effort to Eliminate MHTitles!

To begin with, go to MHI’s website: manufacturedhousing.org and access the National Communities Council division’s Fall newsletter, Community Connections. There read the article titled: ‘Proposed ULC Manufactured Home Titling Act’, by Marc Lifset, esquire, of McGlinchey Stafford law firm. Here’re a few salient passages from that article. Not a member of MHI or its’ NCC division? Phone (703) 558-0666.

What’s the hullabaloo about? ‘The Act as currently drafted would establish a new method of titling, conveying and encumbering manufactured homes, including pre – HUD Code Homes…all first retail sales of Homes must be documented by a statutory form of manufactured home deed recorded in the property records…the Home becomes real property when it is ‘installed’ on land (“The Act defines ‘installed’ as when ‘the wheels & axles…have been removed and the home has electricity supplied by a utility or by any other means…’.”). At that time the Home would convert from personal property to real property ‘for all purposes.’” – Whether the manufactured Home is located outside and or within a landlease community? Ah, one of the unresolved major issues of this proposed legislation.

Proposed legislation? You bet. Politically savvy manufactured housing industry aficionados have sufficient reason to believe seven states have been targeted to effect this new uniform law; one Midwest state in particular. Legislation’s stated purpose? In part, to “…increase the availability of reasonably priced financing for Homes now conveyed and encumbered as personal property…” and much more. Not surprisingly, one of the largest lending institutions (banks) in the U.S. is quietly promoting this legislation, that has as many profoundly counter – productive consequences (i.e. homes sited in landlease communities likely to be taxed as their realty – secured counterparts outside the leasehold property, even though the leasehold property owner already pays high local real estate taxes for the improved real estate) as its’ stated purposes!

In this veteran industry observer’s opinion, this is an insidious assault on our unique type factory – built affordable housing (i.e. HUD Code manufactured housing) shelter alternative; and its’ related, generally inexpensive family and adult lifestyle (i.e. landlease communities) opportunities, that we provide for hundreds of thousands of homeowners and homesite lessees throughout the U.S. It’s also apparent, naïve and ill – informed academics, some local government agencies and regulators, short – sighted consumer advocates, and wishy-washy politicians, find this sort of idealism cum contretemps irresistible, and worth the wasting of time and other resources.

So, ensure your state MHAssociation is well aware – and educated, concerning this soon to be national uniform law initiative, changing the titling, conveying and encumbering of all manufactured homes, including pre – HUD Code Homes! And remember, you first read about it here.

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George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

Time for Radical Change at the Manufactured Housing Institute

This won’t take long or much space to describe here, so let’s get started…

First. With annual new home shipment volume at a 60 year nadir for three consecutive years thru 2011; and, only cherry picking independent third party chattel financing available for new HUD Code homes, many would agree it’s time for some sort of radical change in and or about the HUD Code manufactured housing industry! We’re no longer a healthy business model, but rather a made – for – TV ‘SURVIVAL’ episode. And there’s certainly little help or change on the horizon, if the USA Today newspaper front page story, on 9 November 2011 has it right:

“Foreclosure sales are moving so slowly in half of the states that, at the current pace, it will take more than eight years on average, to clear the 2.1 million homes in foreclosure, or with seriously delinquent mortgages, new research shows.” (&) “The backlog suggests the fallout from the nation’s worst housing market collapse is likely to weigh on real estate prices in many markets for years to come.”

Second. The Manufactured Housing Institute (‘MHI’) just lost the best president and CEO it’s ever had. Wanna guess the reason? A hint. Starts with the letter ‘$’. And now, MHI’s board is supposedly seeking his successor. I say ‘supposedly’ because, as a direct dues – paying member of the institute, I’ve not heard or read anything announcing the appointment of an ‘executive search committee’. Have you? Didn’t think so. And it’s because of this observation, and content of the two preceding paragraphs, I’m bold to propose the following ‘Radical Change at the Manufactured Housing Institute’:

Finally merge the Manufactured Housing Association for Regulatory Reform (a.k.a. MHARR) with MHI; yes indeed, and make Danny Ghorbani executive – in – charge of all home manufacturing/distribution matters; and yours truly, George Allen, executive – in – charge of all landlease community owner/operator affairs! And atop that new HUD Code manufactured housing and landlease community pyramid, position the present day board chairman – or his handpicked designee, to lead both major segments of the now equal and new relationship between, what some have described our historically disparate state of affairs as being, the ‘production & post production’ divisions cum partnership!

Know what else I’d do? Challenge those two new ‘executives – in – charge’ of this new, as yet unnamed national manufactured housing and landlease community advocacy partnership (I suggest Affordable Manufactured Housing Alliance or AMHA), to offset their six figure salaries with new membership dues from newly recruited members directly joining their respective ‘production & post production’ halves of the organization! Can’t meet that heady goal in 12 months time? Replace em!

There’s much more to this ‘Radical Change at the Manufactured Housing Institute’ proposal, but nearly enough penned in this blog posting. Next week? How ‘bout The Top 10 Tongue – in – Cheek Reasons NOT to effect this ‘Radical Change at the Manufactured Housing Institute’ (with apologies to David Letterman). For example: ‘Danny Ghorbani has only 43 years of manufactured housing experience.’ And the chairman’s hand – picked designee? I can think of at least four strong candidates. Will hint at their identity as well.

A further thought. What effect would my ‘joining MHI’s new partnership’ have on David Funk and our plans to launch the new, national not for profit Center for Manufactured & Affordable Housing Research & Resources? Think about it. There’s no reason the 50,000 landlease communities asset class can’t “Have its’ cake (i.e. Effective national political & regulatory advocacy) and eat it too (i.e. Enjoy the same statistics gathering, print & online communication, interpersonal networking, and property management training & certification resources it has today and will likely have tomorrow)!’ With that said, it’s fair and accurate to posit: ‘Never again will this unique and timely radical change opportunity, to unite and prosper together, present itself to the manufactured housing industry & landlease community realty asset class!’ What do you say we ‘Carpe diem!’ ?, as in ‘Seize the Day!’

Where does all this leave us? That’s up to you! This blog posting reaches 500 manufactured housing and landlease community aficionados every weekend. At this point, I’ve done my part: Presented a plan for ‘Radical Change at the Manufactured Housing Institute’. And not as an outsider, but as a longtime direct, dues – paying member of the institute, and founding – as well as present – elected board member of its’ 15 year old National Communities Council (‘NCC’) division. If you too are a direct, or even a Certified Member, of MHI, and this plan for ‘Radical Change at the Manufactured Housing Institute’ goes no further, you’ll have only yourself to blame. Because, after the dust settles, during and after discussions, and either implementation or rejection of said plan and change, business life will certainly ‘go on’ for all of us, until….

Again, plans for my future business emphasis and succession are in place, and will likely continue. All I’m saying is, I’m willing and ready – if sincerely asked, to be an integral part of ‘Radical Change at the Manufactured Housing Institute’, IF it means SURVIVAL for the MHIndustry & LLCommunity asset class! And contrary to ‘rumors on the street’, there are no plans whatsoever, at this time and where I’m concerned, to spawn a new post production national advocacy body, the recently announced MHInitiative (nee National State of the Asset Class or NSAC caucus series) notwithstanding! Can’t say or pen it any plainer than that.

Finally, look at it this way; actually, two ways. Almost any radical change and new partnership (i.e. between the manufacturing/distribution & landlease community segments) at MHI, works better than the unbalanced industry segment representation and dysfunctional advocacy contretemps in effect today! And now YOU can’t say, ever again, you have not been challenged to be a radical change catalyst. What will YOU do with the opportunity?

Your input, as always, is welcome here, via gfa7156@aol.com or the only MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, or write to me via GFA c/o Box # 47024, Indianapolis, IN. 46247.

Who else might you contact about Radical Change at MHI? Here’re some alternatives:

Manufactured Housing Institute: info@mfghome.org
Manufactured Housing Association for Regulatory Reform: dannyghorbani@aol.com
MHI Chairman Joe Stegmayer: joes@cavco.com
NCC Chairman Steve Schaub: sschaub@yescommunities.com
MHARR Chairman John Bostick: jbostick@sunshinehomes-inc.com

***

George Allen, CPM®Emeritus & MHM®Master
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

MHIndustry needs a good muckraking* journalist…. Why?

(And it’s not going to be me!) Why?

Well there are indeed answers, of sorts, to both questions.

* What’s muckraking? According to our handy Webster’s Dictionary, “…to search for and expose real or alleged corruption, scandal, or the like….”

Now for a response to the first ‘Why?’ question. For starters, too many ‘things’ occur, and yet ‘some’ don’t happen, legislatively and leadership wise, in the manufactured housing industry at large, and landlease community asset class in particular, that go unresearched and parsed in detail, let alone reported to the general factory – built housing and realty business public, by independent third party news and investigative sources. In effect, our culprits are enabled to hide till their next faux pas.

Some examples. Recall how the Manufactured Housing Improvement Act of 2000 (This was passed to give our unique housing type parity with site – built housing!), after 11 long years, is still NOT fully implemented; then, how the S.A.F.E. Act (i.e. Safe And Fair Enforcement Mortgage Licensing) was foisted on us with little to no advance warning or even fight; and finally, how we’ve been unnecessarily swept up into the onerous provisions of the Dodd – Frank Bill (According to a letter I have in my possession, penned by Congressman Barney Frank on his letterhead – one of the bill’s coauthors, stating as much!). And frankly, I could easily add other contemporary examples to this nefarious list of non – starters, non – finishers, and entrapments in between them.

Relative to landlease communities. Much of the ripe muckraking fodder here, has to do with individual companies and property portfolios. While business successes and failures, like death and taxes, are always present, you’d think folk would learn from their, and their peer’s past missteps and mistakes. But too many times they don’t; in part, because they simply ‘don’t know’ the nature and scope of said missteps and mistakes. Here’s but one example. How many of you were around, during the mid to latter 1990s, when Wall Street analysts treated our new landlease community (nee manufactured home) community real estate investment trusts (‘REIT’) as ‘growth stocks’? In essence, promoting unrealistic expectations that REIT FFOs (funds from operations) would always GROW, quarter after quarter after quarter. Did any realty trade journalists step to the fore and tell them it simply ain’t so? No! So REITs cut operating expenses where they could, then jacked homesite rents to levels they probably shouldn’t have, to satisfy those misguided, unreasonable expectations. Result? Three of six REITs have disappeared since 2003. And there’re more related tales (e.g. regulatory overkill relative to in – community installation of homes) to be told, that likely won’t be, until a skilled, well – funded trade journalist comes along, to pen our industry and asset class’ version of Gerald C. Meyers’ compendium of business failures in, When It Hits the Fan (1986).

And from time to time, there’re poorly – reported measures that cut across industry and asset class lines. Reread what was penned ‘within and between the lines’,
of blog postings at this website during the past two weeks, describing MHI’s recent, ill – advised ‘sprinkler proposal’ (a.k.a. ‘Dire effects of the Law of Unintended Consequences’) to the Manufactured Housing Consensus Committee (‘MHCC’). Not only will this proposal allow ‘HUD’s preemption – ending foot’, to get well inside manufactured housing (Think ‘conditional cum mandatory standard implementation’), but landlease community owners, likely in the future, will have to account for their property’s infrastructure inadequacy to support fire suppressing water sprinklers in manufactured homes! There’s more to this nefarious, ready – for – muckraking story. Ponder; what sole segment of the MHIndustry benefits most, in the long run, from forced building standard implementation; and, what’re the chances such ‘future benefit thinking’ precipitated this proposal to the MHCC? Also ask yourself: ‘Is anyone else, in the trade press, warning us of such potential, self – initiated disasters on our business horizon?’ The answer? “No!” An apt answer that circles back to the original question of ‘Why?’

My response to the second ‘Why?’ question; specifically, ‘Why not me?’ I’m a freelance writer and consultant whose ‘beat’ is indeed, the manufactured housing industry in general, the landlease community asset class in particular. Frankly, I rely on funding from two subscriber – supported newsletters and book sales, consulting assignments (e.g. Mystery Shopping, property ‘turnaround’ planning, and occasional covert undertakings), along with profits from hosted meetings during the course of a year, e.g. Networking Roundtable, Manufactured Housing Manager (‘MHM’) professional property management training and certification classes, and FOCUS Groups, to keep our firm solvent. Unfortunately, I no longer rely on patronage or other independent financial support from business associates, to provide the cushion needed, to research and pen stories that keep this industry and asset class fully informed; and, keep those who’d ‘take selfish advantage of both’, on their toes. As a result, much of what you used to read, learn, and apply in the past, and still need to know and consider in the present, now goes unresearched and under reported. And I see no great change to that sorry state of affairs. That’s why this industry and asset class needs a muckraker of sorts, rather than me.

An answer, of sorts, to this journalistic shortfall? Given the ever shrinking nature of the manufactured housing trade press, during the past several years, and the woeful lack of cutting edge reporting today, online and in print, YOU owe it to yourself and your business future, to be all the more diligent about what’s going on, not only in your local housing market(s), but on the broader scale as well! I believe that’s why so many of you (500 at last count) have signed – on to receive a BEBA (Blast Email Blog Alert) every Sunday, reminding you to read this blog posting. But that’s not enough! You’ve gotta reach out, and ensure you’re ‘in the know’ wherever and whenever possible.

With that said, here’s an alternative, replete with a few practical and timely examples, of how to accomplish that end. So, aside from what you just read in this blog today, and during the past few weeks, did YOU know?

• A copy of the very first White Paper researched and penned, describing and comparing similar and dissimilar home marketing and sales perspectives, of independent ‘street’ MHRetailers and in – landlease community home sales center operators, is now, this week, available to YOU, from one trade source!

• A year ago this month, a national Request for Proposal was published, to identify a successor who’d continue to effect research & statistical reports, property management training, and interpersonal networking for all landlease community owners/operators. Result of the search is now available to YOU, from one source!

• Do you realize the HUD Code manufactured housing industry has undergone several major paradigm shifts in its’ business model since the early 1970s, what they are, and how they likely affect your business today? Well, that one page retrospective document is, this week, available to YOU, from only one source!

These three timely resources and more (e.g. A new list of latest Business Development Managers (‘BDM’) marketing Community Series Homes (‘CSH’) to LLCommunities) is available in the November 2011 issue of the Allen Letter professional journal! If not already a paid subscriber, the annual rate is $134.95, and is available, by simply phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. And remember, the January issue of this same newsletter will contain the 23rd annual ALLEN REPORT, a.k.a. ‘Who’s Who Among Landlease Community Portfolio Owners/operators Throughout North America!’

Now, has all this just been a glorified promotion for the Allen Letter professional journal? Certainly ‘reads like it’, but it’s not. Rather, it’s simply letting manufactured housing and landlease community businessmen and women know where they can obtain accurate industry and asset class news, penned by a 30+ year veteran of the very same Free Enterprise endeavors in which they are presently engaged! It’s simply ‘your call’ as to how valuable or invaluable such news and information is to YOU and your business, present and future.

***

MHInitiative®. We’re taking a week or two off from talking about this tentatively planned brainstorming event, for business owners, to meet, decide, and plan ‘How to Save Our Industry?!’ in 2012, maybe 2/27/2012. If you can’t bear to wait to learn more, or want to offer helpful input, simply access the MHIndustry HOTLINE cited earlier, or email me via gfa7156@aol.com GFA

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SHARK ATTACK!

In this day of hyper ‘industry image sensitivity’, a.k.a. political correctness or PC, it’s, in my opinion, grizzly poor taste, to describe the annual gathering of MHIndustry & LLCommunity peers, in Louisville, KY during January 2012, as being where to…

“…gather together with all the other hungry sharks and grab new business in 2012.”
Quoted from the event brochure, featuring a huge shark swallowing its’ victim whole!

While I’m all for ‘grabbing new business in 2012’, I’m NOT for being thought of as
‘an MHIndustry or LLCommunity shark out to devour future customer(s)’, as graphically depicted in the color photo on the aforementioned brochure. While I’ll certainly be present for the ‘Louisville 2012 Manufactured Housing Show’, it’ll be as ‘a businessman intent on learning how to better and best earn my customer’s business and loyalty in the year ahead.’ How ‘bout you? Hungry shark or savvy businessman or woman?

To this latter end, about earning one’s customers business and loyalty. If you own and or operate one or more landlease communities, and haven’t yet been trained and certified as a Manufactured Housing Manager®, consider participating in this excellent one day program during the Louisville MHShow! On Thursday, January 12, between 8AM and 4PM, I’ll be teaching the MHM® professional property management (‘PM’) training and certification program, in the immediate vicinity of the Kentucky State Fairgrounds (location of aforesaid Louisville MHShow). Only costs $250.00 per MHM® candidate; and remember, there’re nearly 1,000 MHM®s who now own or manage LLCommunities throughout the U.S. and Canada. And this is the only LLCommunity PM certification program taught by a Certified Property Manager® member of the prestigious Institute of Real Estate Management®, and veteran LLCommunity owner/operator. For a brochure describing the day long course content, and to register, phone (317) 346-7156.

Back to the SHARK ATTACK! op/ed stuff. Who knows, perhaps the old bromide is right after all: ‘Bad publicity is better than no publicity!’ In any event, hope to see you at the Louisville Show @ 1/11 – 13/2012; better yet, at the MHM certification class on the 12th!
For more information on the Louisville Show, phone (770) 587-3350.

***

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

“Shh! Be Quiet, and it all might go away.”

MHI’s ‘Sprinkler Proposal’ to the MHCC, & the NSAC – III Caucus cum MHInitiative, ‘How to Save Our Industry?!’, likely 27 February 2012.

Versus

“Step up & do ‘your part’ as an MHActivist!”

It is not too late to 1) tell HUD know what you think their Research Policies should be, going forward; 2) attend the first National Summit for Independent ‘street’ MHRetailers & in – Landlease Community Home Sales Center Operators; and, 3) participate in the 23rd annual ALLEN REPORT, a.k.a. ‘Who’s Who Among Landlease Community Portfolio Owners/operators Throughout North America!’ And all that’s ‘just for starters….’

But FIRST, important Breaking News!

If you’re a lender or financier, of any sort or to any degree, relative to self – finance methodologies (i.e. ‘buy here – pay here’, ‘captive finance’, maybe even lease – option) of the chattel (personal property) capital variety, you’ll likely want to acquire a copy of the Rishel Consulting Group’s digest of the recently released CFPB Examiner’s Manual. This digest contains material relating only to manufactured housing. As the Consumer Finance Protection Bureau (‘CFPB’) recently opined, ‘Non – depository lenders (i.e. those described in the previous sentence) will conform to the same rules, regulations, and standards that banks and credit unions are currently subject to.’ To order this $500.00 resource, phone Donna Rishel @ (217) 899-9268. Credit card orders only.

OK, now onto the gist of this week’s blog…

I

Last week’s BEBA (Blast Email Blog Alert) read, in part: ‘Own landlease community (ies)? MUST READ MHARR’s 10/21 Update, & MHI’s 10/21 Week in Review, to learn why MHCC ‘sprinkler proposal’ puts YOU at risk of future liability…’

I’ll admit that’s a sketchy lead – in, but it was worded to spur you to action, i.e. to contact either or both national manufactured housing advocacy bodies, to request and read copies of their respective communiqués, then ponder the consequences of said ‘sprinkler proposal’ on your own. How many of you did so?

In any event, here’re excerpts from one of the subject communiqués and an email exchange I had with a representative from one of the aforementioned bodies late last week, the same day I effected the final edit to last week’s blog posting and composed the aforementioned BEBA:

• From MHARR’s Washington Update. “In a move that could ultimately open the door to an across – the – board federal fire sprinkler mandate, the Manufactured Housing Consensus Committee (‘MHCC’) at its’ October 18 – 20, 2011 meeting, voted to accept and recommend to HUD a Manufactured Housing Institute (‘MHI’) – proposed federal standard that “establishes the requirements for the installation of a fire sprinkler system in a manufactured home.” Interestingly, “The vote in favor of the sprinkler proposal came just one day after the National Fire Protection Association (‘NFPA’) was forced to concede that today’s manufactured homes are as fire – safe, and even safer, than site – built homes.”

• From an email received from MHI’s National Communities Council division VP & Executive Director Lisa Brechtel: “…there is no mandatory requirement to install fire sprinklers in manufactured homes. In fact the proposal explicitly preempts fire sprinklers. …the proposal provides a uniform, voluntary design and construction standard for fire sprinklers should a consumer choose to purchase a home with this option.” Unfortunately, this response clearly ‘misses the point’, where LLCommunity folk are concerned; if not now, likely sometime in the future.

• From an email sent, by this industry observer (and landlease community owner) to MHI and NCC executives: “This new federal statute, and the related publicity, will potentially affect those of us ‘with skin in the game as landlease (nee manufactured home) community owners’. Sure, I don’t see an immediate impact on my property. But now, if I’m prudent – and I think I am, MHI, the NCC and MHCC have collectively, put me in the position of ‘further screening’ every home move – in, whether new or resale, as to whether it has a built – in sprinkler system. And in my case, warning them my otherwise attractive, functional rental property probably can’t support their ‘fire safety system’s need for higher water volume and pressure’; in effect saying, “Would you please sign this waiver, acknowledging the inferiority of my property’s infrastructure design and capability, and accept the increased liability potential to your home, in the event it catches fire while sited here?”

Bottom line? IF the MHCC’s fire sprinkler standard remains unchanged, characterize this serious advocacy misstep to being another unfortunate, self – immolation example of the Law of Unintended Consequences!

POSTSCRIPT. As late as Friday, 26 October 2011, MHI communications continue to ignore the issue of probable consequences of having fire sprinklers in manufactured homes sited in older landlease communities.

II

MHInitiative®. Gotten used to that new Allenism term yet? By way of review of last week’s blog posting announcement, MHInitiative® is the creative moniker given the evolving scope of two National State of the Asset Class caucuses, first held 2/27/2008 in Tampa, FL., attended only by landlease community owners/operators; and one held 2/27/2009 in Elkhart, IN., attended by a near – equal number of HUD Code home manufacturers and LLCommunity folk. This time around, likely on or about 2/27/2012, and somewhere in the southern Sunbelt, an MHInitiative® is being planned, and will be hosted as a national caucus for ‘anyone in the manufactured housing industry and landlease community asset class who are bona fide business owners and senior executives’ – willing to invest personal and corporate resources (i.e. time and travel expenses) to spend 1 ½ days, or 2 ½ days if necessary, in a brainstorming session focused solely on ‘How to Save Our Industry?!’

Based on heavy reader response to last week’s blog posting debut of the MHInitiative®, along with individuals previously committed to participate, we could hold the MHInitiative® ‘tomorrow’, and count on more than 100 seriously – concerned MHIndustry & LLCommunity businessmen and women MHActivists being present!

Speaking of MHActivism….

III

Did YOU respond to HUD’s request for Public Comment on HUD’s Research Agenda, described in last week’s blog posting? Well, several of you did! You sent me copies of your correspondence. Thank You for following my ‘lead’ in this effort.

I prepared three separate commentaries; one each on the ‘Homeownership & Finance’ category, with this focus: “It’s Time for HUD to Overtly Promote the very Factory – built Housing type it has Regulated since the mid – 1970s, i.e. HUD Code Manufactured Housing!”. This was my response to ‘Rental Housing’: “Before HUD addresses this timely goal, it should step to the fore and launch a nationwide initiative, seeking consensus among housing providers, lenders and regulators, regarding ‘affordable housing’ & ‘housing affordability’ definition, description, and means of measurement.” And finally, re: ‘Communities’, I opined, “Does HUD even know what a landlease (nee manufactured home) community is? If not, now is the time to learn, as HUD seeks a ready supply of inclusive and sustainable, affordable housing communities, free from discrimination.”

And here’s the Good News for you, loyal blog floggers (readers). The deadline for ‘your submission’ is 4 November 2011. So, as soon as you’re done reading through this posting, sit down and knock out a letter to HUD USER c/o Box # 23268, Washington, DC. 20026-3178. What to say? While it’s certainly ‘up to you’, why not parrot my suggestions, that HUD not only regulate our unique factory – built housing type, but for the first time in 35 years, start to overtly promote it, as our nation’s most affordable type housing; that before HUD talks and writes about ‘affordable housing’, they should know how to define, describe and measure it; and finally, ‘discover’ LLCommunities for the desirable, even affordable lifestyle, they provide!

IV

Do YOU market and sell HUD Code manufactured homes via an independent ‘street’ MHRetail salescenter and or an in – landlease community home sales center? If so, seriously consider participating in the first ever, maybe even historic, National Summit for Independent ‘street’ MHRetailers and in – Landlease Community Home Sales Center Operators. This 2 ½ day event is being held 13 – 15 November 2011, at the Drake Hotel in downtown Chicago. For registration information, contact Bill or Chad Carr @ (800) 336-0339. I hope to see YOU there!

By the way, join me for some informal, no host, interpersonal peer networking, in the coq d’ or lounge (downstairs from the lobby) at the Drake Hotel, between 3 and 5PM Sunday afternoon, 13 November. It doesn’t matter whether you’re attending the aforementioned National Summit or not; if you happen to be in downtown Chicago that day, stop by to socialize and ‘talk shop’ with friends in the MH & LLCommunity business!

Also remember, the first public release of an extensive White Paper, on manufactured housing sales, prepared as a ‘backgrounder’ for participants in this national event, will appear as part of the November 2011 Allen Letter professional journal. To subscribe, phone, (317) 346-7156.

Hey, is it starting to get downright exciting around here, or is it just me?

V

Research and compilation of the 23rd annual ALLEN REPORT, a.k.a. ‘Who’s Who Among Landlease Community Owners/operators in North America!’ is well underway. We’re now making follow – up phone calls to portfolio ‘players’ listed in the 22nd edition, to ensure they’re ‘not left out’. SO, if YOU and or your firm owns and or fee manages five or more LLCommunities and or a total of 500+ rental homesites (in one or more properties), then YOU qualify for inclusion in this seminal collection of benchmark statistics, description of present day trends, and ‘all you ever wanted to know about our unique income – producing property type’ but didn’t know who to ask!

How to participate? Best NOW, to phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 or (317) 346-7156 or email: gfa7156@aol.com What happens? I’ll fax you the standard questionnaire; you complete it ASAP; and fax it back to me via (317) 346-7158. It’s as simple as that! Hope to hear from YOU soon!

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024, Indpls, IN. 46247 (317) 346-7156.