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

For the time being, Forbearance apparently trumps Foreclosure!

Do you have a commercial real estate mortgage coming due and see no way, at present, to pay it off or refinance? Or perhaps you’ve been through this stressful drill during the past year, and the old bromide, ‘Take one day at a time’ has new and sobering meaning for you. If so, and in either event, I know just how you feel. As we’re oft wont to say, ‘Been there, done that!’

With that stated, however, what is one (i.e. borrower) to do when faced with, 1) imminent default, 2) loan balloon with no replacement lender and property worth less than the debt, or 3) loan balloon with no replacement lender and a property worth more than the debt? First step is ‘education’. If you didn’t read Creighton Weber, Nick Bertino, & Tony Petosa’s (Wells Fargo) recent (August 2009), excellent two page special report on this very subject, ‘What to do when your loan comes due!’, contact this Blogger for a free copy (via Blog reply or MHIndustry HOTLINE: (877)MFD-HSNG or 633-4764.

Next step? Well, that depends on your particular circumstances and the terms and conditions of your commercial real estate loan(s). Right now (i.e. remainder of 2009 and into 2010 – and hopefully, longer) many, if not most, lending institutions ‘have been reluctant to foreclose’*1; and some special servicers (i.e. “… party designated to ‘work – out’ loans or foreclose on loans, if they go into default” CW) have opted to forbear rather than foreclosure.

In a recent issue of PERE magazine, Sam Zell (i.e. Think ELS, Inc., as in Equity Lifestyle Properties, Inc., formerly MHC, Inc.) was interviewed for his views on this and related realty topics. Sam argued that ‘despite declines in property values of at least 30 percent, banks (are) willing to let borrowers “carry” their loans beyond maturity, even if they (have) little chance of paying them off.’

“Everyone is talking about this giant balloon of loans coming due,
that the end of the world is coming because we’re never going to be
able to refinance. Instead, we have a scenario of extend and pretend.
If an owner has no equity, just an option – a hope certificate – why
would he sell unless he was under complete distress? He’ll extend
as long as he can keep paying the debt service and the lender will
leave him in place.”

End result, in Mr. Zell’s opinion? “I don’t think there are going to be significant grave dancing opportunities in equity this time round, other than in the hotel business.” *2 So, that confirmation brings faint hope to those faced with (maybe) imminent default and either of the two ‘loan balloon with no replacement lender’ situations.

But not everyone sees this favorable – though – personally or corporately – stressful scenario continuing for long into year 2010. The following is quoted from the Executive Summary of Urban Land Institute’s (‘ULI’) recently released, prestigious, annual tome Emerging Trends in Real Estate:

“…the commercial real estate industry hits bottom in 2010, suffering
a surge of painful write downs, defaults, and workouts. Massive
government infusions finally build up loss reserves in financial
institutions to levels allowing them to foreclose or strike deals with
many over leveraged borrowers.” *3

The tome’s author goes onto state: “…2010 will be the worst time for investors to sell properties in the report’s 30 – year history, but will offer a much – improving environment to buy (with cash).” *4 – no limiting equity opportunities to the hotel sector here.

So when do these confusing, and again, yes – stressful debt and equity aberrations end? Probably not until sometime after 2015, according to Emerging Trends.

“Debt markets will remain severely compromised – resuscitated banks
will increase lending slowly, employing strict underwriting standards
and requiring significant equity stakes from borrowers. Moribund
CMBS (Commercial Mortgage Backed Securities) markets remain
entangled in complex workouts of failed multitranched structures
with mounting levels of troubled loans maturing through 2015.” *5

Care to share your unique ‘loan due scenario’ with readers of this Blog? Then reply directly to this Blog, phone above MHIndustry HOTLINE, or write GFA c/o Box # 47024, Indianapolis, IN. 46247.

*****

Important Reminder! Compilation of 21st annual ALLEN REPORT is just about complete. More landlease community portfolio owners/operators listed this year (125) than last. Given the altered landscape of MHIndustry & LLCommunity trade press reporting, this year’s ALLEN REPORT will only be available, as a free lagniappe, to Allen Letter paid subscribers, or through direct purchase for $134.95 from PMN Publishing @ (317) 346-7156. Credit card orders welcome! If you own and or manage this unique type income – producing property report, you need the 21st annual ALLEN REPORT as a handy and ongoing reference resource to the asset class benchmark statistics. GFA
*****
End Note.

1. Quoted from RCAReport published by NAR @ Fall 2009, p. 1.
2. PERE magazine, November 2009, p.22.

A DRAFT manuscript, titled ‘The Near Perfect Storm Manifesto’ was recently distributed to 26 business stakeholder leaders active in the manufactured housing industry & landlease (nee manufactured home) community real estate asset class. Written responses have been numerous and 100% supportive of the document’s thesis:

‘Imagine No New HUD Code Homes Manufactured in Year 2020!’

Accordingly, a new chapter, and likely one of several when all is said and done, is being added – via this week’s Blog – to the original DRAFT manuscript. And if responses and ideas to this week’s Blog continue to arrive, as they have to date, it’ll be appropriate to envision early 2010 as the timeframe during which some – or many, come together to
lay the foundation for a rejuvenated HUD Code manufactured housing industry,
maybe in a manner untried to date. But this is not going to even begin to occur, without your input and commitment to materially participate in the very salvation and rebirth of our unique factory – built housing business model! Are you ready? Then let’s read and reflect upon the content of chapters one and two together, then….

Chapter # 1.

The Near Perfect Storm Manifesto

‘Imagine No New HUD Code Homes Manufactured in Year 2020!’

or

The Not So Secret Scheme to Regulate and Politic HUD Code Manufactured Housing Out of Business by the Year 2020…

*

At a recent meeting of a de facto Think Tank* pondering the past, present and future of landlease (nee manufactured home) communities, 40 conferees identified more than 20 business indicators and significant trends affecting that realty segment of the industry, during years 1999 through 2009, out to 2019 and beyond.* What wasn’t discussed however, are the dark clouds of an impending near perfect storm, threatening the continuing existence of the home manufacturing segment of the industry, a blow characterized by onerous regulatory manifestations, bureaucratic inefficaciousness, and political legerdemain. These, and other conditions, appear poised to wash away what’s left of this nation’s sole homegrown type and source of affordable factory – built housing!

To understand and appreciate how this latest near perfect storm has advanced on the HUD Code manufactured housing industry, one must look back to 1972 when factory – built housing enjoyed the sunniest of times, shipping 575,940 new mobile homes throughout the United States in one year!. And 26 years later, 1998 was almost as sunny again, with 372,843 new manufactured homes shipped! But between those apex and renascence years, the industry endured its’ first major (regulatory) storm, only to now appear to be on the cusp of being wiped – out by yet another! Precursor to the first storm, was passage of the HUD Code (i.e. Federal preemptive building code for factory – built housing) in 1974, implemented in 1976. Result? A halving of new manufactured home shipments, down to an average of 249,000 homes per year during 15 years, until 1991, when we hit our first nadir of 179,713 – before rebounding to 372,843 new manufactured homes during 1998! Precursors to the second, now near perfect storm? Selfish missteps within the industry, involving massive misuse of chattel (personal property) housing finance; and, the hollow promise of positive regulatory reform (i.e. Finally evolving manufactured housing from the ‘trailer business’ to becoming a bona fide housing supplier!) couched in passage of the Manufactured Housing Improvement Act of 2000.*

What’s happened between year 2000, when the MHIA of 2000 was passed, and now? Statistically, it looks like this:

2000 = 250,550 new HUD Code manufactured homes shipped; then in…
2001 = 194,229
2002 = 168,491
2003 = 130,937
2004 = 130,802
2007 = 95,769
2008 = 81,889
2009 = (50,000+/-)
2010 = ________?
&
2020 = 250,000 as in year 2000; or 50,000+/- as in year 2009 & 10; or 0+ ?

Yes, manufactured housing’s near perfect storm is indeed imminent! What are just some of the prevalent and potentially harmful weather conditions?

• A cold front at HUD, characterized by perennial bureaucratic wrangling with the politically gerrymandered Manufactured Housing Consensus Committee (‘MHCC’), operating in a 100% regulatory environment! Ask yourself: ‘When was the last time I heard and or read of HUD overtly promoting HUD Code manufactured housing in any fashion?’ Not! Last I heard, umpires like baseball, referees like football. Why can’t HUD career employees and political appointees like our unique form of affordable, quality, energy efficient, transportable, non – subsidized, factory – built housing enough to promote it, instead of stifling its’ affordability by regularly increasing its’ cost to the American homebuyer?

• Continuing lack of the much – needed, non – career administrator to function as HUD and industry’s weatherman, warning all parties of imminent stormy weather, suggesting how we might survive, and dare I mention, thrive together in service to our nation as ready suppliers of truly affordable, attractive housing!

• A turbulent upper atmosphere apparently not improved with the recent (2009) change in federal government administration. Will the sun shine through this near perfect storm before it’s too late? Let’s hope so….

• Continuing lack of sufficient chattel home financing with which to weather this near perfect storm. Just maybe part of the answer to this storm condition lies with cutting through red tape and barriers long germane to the FHA 207(m) Program.

• Continuing local (housing market) regulatory barriers (e.g. acronyms NIMBY, LULU & BANANA*) to all forms of affordable housing needed to shelter our nation’s citizenry, storm or no storm!

• Growing, continuing threat to affordability of HUD Code housing by dint of installation overkill, threat of water sprinklers as original equipment, ongoing transportation restrictions and much much more…

Bottom line? Unless our industry’s two trade bodies in Washington, DC., once and for all, simultaneously and united, adopt identical foci in behalf of every segment of the manufactured housing industry, there simply will not likely be an industry by the year 2020! Effect this will have on landlease communities (‘LLCommunities’)? With no new HUD Code housing, a continual need to rejuvenate existing housing stock, site RVs when and where allowed, utilize other forms of factory – built housing (e.g. modulars & ‘park model’ RVs cum homes), even build new homes on – site to complement existing HUD Code homes. No longer will the 50,000+/- LLCommunities enjoy ‘business as usual’!

What are some of the things MHARR & MHI* should be united in effecting ASAP?

• Press for full & immediate implementation of MHIA @ 2000; accept no excuses!

• Press for immediate appointment of non – career administrator to guide MHCC!

• Plan and soon effect a major national Image Improvement Campaign, on behalf of all brands of HUD Code manufactured housing, using appropriate media and online resources and opportunities. Invite the LLCommunities segment of the industry to help financially support this timely and much – needed effort!

So, in the meantime, what are manufactured housing industry purists, aficionados, even Luddites, to do? Maybe hunker down, as HUD Code home manufacturers have already, and hope for the best – which might eventually come as an up tick in the affordable housing need cycle. But know what? That’s not going to happen anytime soon, because hundreds of thousands of foreclosed site – built homes are on the market and must be ‘sold through’ before prospective homebuyers return to factory – built housing. Hunkering down is not the effective answer! Become an activist! How? Reread the previous paragraphs, then personally and corporately commit to address the following:

The biggest disconnect within the HUD Code manufactured housing industry
and its’ sister business model, LLCommunities, lies in the near complete lack
of understanding and appreciation of ‘the other (segment’s) business model’.

HUD Code home manufacturers, till recently (early 2009), gave short drift to
community folk; and in turn, LLCommunity owners/operators have too long taken manufacturers and distributors of HUD Code housing product for granted. NOW is almost too late to learn and appreciate ‘the other party’s role’ in and about our unique and related business models. Are you willing to try? If so, start now! The price for not doing so is too high for any one of us, alone, to bear; specifically:

No New HUD Code Homes Built in Year 2020
Postscript.

Early in this article, actually beginning with the title, mention was made of a
‘not too secret scheme to regulate and politic HUD Code housing out of business’.

That’s been touched upon, just not fully explored. Why? Think about it. To do so,
would be in part, to have to name names and identify competing trade entities in national homebuilding business environs; as well as to criticize divergent leadership styles, from those publicly ‘resisting perceived regulatory encroachment at all costs’, to what appears to occur behind closed doors: ‘consensus – building to the extreme’. Are you, are we, ready for that sort of expose and discussion? I suppose your answer to that question depends on whether one agrees with and believes the thesis you’ve just read, or simply don’t care to form an opinion upon which you might be called to act. Again remember, the possible consequence of your personal and corporate inaction might well be…

No New HUD Code Homes built in Year 2020!

*****

Endnotes.

1. Urban Land Institute’s (‘ULI’) Manufactured Housing Communities Council (‘MHCC’) meeting November 4, 2009, in San Francisco, CA.

2. Available for viewing at MHI’s National Communities Council website: mhcommunities.org & Communities Connection newsletter or phone (317) 346-7156 and request a copy be emailed to you ASAP.

3. MHIA of 2000 established the MHCC and was viewed as modernizing ‘mobile home’ manufacturing of the early 1970s, to contemporary housing standards for the new millennium.

4. NIMBY = ‘Not in my back yard!’; then there’s LULU = ‘Locally Unwanted Land Use!’; and finally, the ultimate local regulatory barrier to all forms of affordable housing clearly expressed by the acronym BANANA = ‘Build Absolutely Nothing Anywhere Near Anything!’ Have additions to this list?

5. Manufactured Housing Association for Regulatory Reform (‘MHARR’) & Manufactured Housing Institute (‘MHI’)

*********************************************************************

Chapter # 2

Near Perfect Storm Manifesto now Manufactured Housing’s Jeremiad? *

‘The Near Perfect Storm Manifesto’ was distributed, along with a cover letter, to 26 business stakeholder leaders active in the manufactured housing industry and landlease community (‘LLCommunity’) real estate asset class. Fully half these men and women, mostly corporate stakeholders, from California to New Jersey, responded to the manifesto with comments like these:

• “That is a great read, really sums up what’s happening and how important it is some kind of action be taken (soon).”

• “(Manifesto) analyzes industry’s predicament fairly well, but stops short and pulls punches when it should bust it wide open! Looks like (no one) is willing to tackle the major problems the industry is facing; meanwhile, things keep getting worse.”

• “I’ve read ‘The Near Perfect Storm Manifesto’. I share your concerns, predictions, and necessary steps that need to be taken, specifically 1) getting MHI & MHARR to agree on a consistent message to HUD; 2) press for appointment of a (non – career) administrator to guide the MHCC; 3) (ensure) full implementation of the MHIA of 2000; and, 4) (implement) an image campaign.
&.
“I do think there needs to be significant improvements and use of the MHCC –
and it starts with a unified industry.”
&
• “If MHARR & MHI can’t get together to get the job done, perhaps we need a new national trade advocacy body to effectively represent our business interests.”

• “It’s statistically accurate we’re headed straight for extinction…it could happen sooner – 2015! DRASTIC measures need to be taken IMMEDIATELY by national industry leaders, and at the local level, by all of us.”

• “Overzealous and self – promoting bureaucrats/politicians have destroyed many industries, therefore the MH guys should not feel singled out. Look at the cost of automobiles. India now as a car for $2,000 – but you’ll never see one in the U.S. Government regulation will prevent it.”

• “…you cannot beat HUD staff. If you could not win under the Bush Administration, you have no chance with Obama. They do not really want affordably constructed housing. They want to subsidize expensively constructed homes.”
Vs.
“The approach that HUD is the enemy does nothing to help the cause or change anything – all that attitude does is stand in the way of meaningful change. It’s a distraction.”

• “The death sentence might have been imposed on manufactured housing the day in 1973 the industry went to Congress and asked the politicians for regulation. Like death row inmates, it took 40 years for the execution. Government cannot help but add cost, and eventually those costs add up.”
Vs.
“We’ve got affordability of product down pat – financing drives this industry…”

• “the MHIndustry needs to either find a way to succeed with more expensive housing or have Congress repeal the HUD Code law and return regulation to the states.”

How many of these observations, opinions, and suggestions ‘strike a nerve’ with you? Did you notice, while a lot of business angst was expressed, there’s also disagreement on different issues among businessmen and women in the MHBusiness?

OK, so where do we go from here? That’s really up to you. If the preceding remarks have motivated you to become involved, in some fashion, and make your views known – and or willingness to participate, respond directly to this Blog or correspond via GFA c/o Box # 47024, Indianapolis, IN. 46247. The third chapter of this MHJeremiad will unfold during the next 30 days, and be featured in the January 2010 issue of a newly configured Allen Letter professional journal for the MHIndustry & LLCommunity asset class!

January’s Allen Letter is the sole source of this year’s 21St annual ALLEN REPORT (a.k.a. ‘Who’s Who Among LLCommunity Portfolio Owners/operators throughout North America!’); and, will contain special features describing the new Community Series HUD Code homes (Don Westphal), Small LLCommunity Owners Forum (Joanne Stevens, CCIM), and ‘Taking LLCommunity Statistics to the Next Level’ (Bruce Nell). Subscriber? If not, phone (317) 346-7156 and do so today!

But know what? There’s yet more to cover in this Chapter # 2 of our industry and asset class’ final – or first, chapter describing its’ demise or latest renascence – to last another 50 years! The previous quoted responses notwithstanding, there’re two points to be made before bringing this chapter to a close.

First; ‘The National Manufactured Home Construction and Safety Standards Act’, as amended by ‘The Manufactured Housing Improvement Act of 2000’ (‘MHIA@2000’), contains two ‘findings’ by Congress: “Manufactured housing plays a vital role in meeting the housing needs of the Nation; and, manufactured homes provide a significant resource for affordable homeownership and rental housing accessible to all Americans.”* One sure would not know that at present, given the extremely poor state of economic affairs throughout the manufacturing and distribution segments of the HUD Code housing.

Second; Congress sets forth eight ‘purposes’ for this title, the MHIA@ 2000; of which I’ll quote three that relate to what’s been described in this DRAFT and Blog:

• “to facilitate the availability of affordable manufactured homes and to increase homeownership for all Americans;

• to establish a balanced consensus process for the development, revision and interpretation of Federal construction and safety standards for manufactured homes and related regulations for the enforcement of such standards.

• to ensure the public interest in, and need for, affordable manufactured housing is duly considered in all determinations relating to the Federal standards and their enforcement.”

The first of these purposes, in my opinion, relates to the total lack of promotional effort on the part of anyone at HUD, to ensure our nation’s home buying public is well aware, the only factory – built housing type in the U.S., built to a Federally pre – emptive building code, is the most affordable, transportable, non – subsidized, high quality, energy efficient, green housing available anywhere, anytime!

The second purpose relates to the Manufactured Housing Consensus Committee or MHCC. This body, in the eyes of many in the manufactured housing industry, has evolved into a political football – from the manner in which its’ members are selected by HUD, to perennial battles regarding how to develop, revise and interpret Federal construction and safety standards.

The third purpose relates to the dire and pressing need at HUD for “…a noncareer administrator within the Department to administer the manufactured housing program” – for which a funding mechanism is already in place; and not only that, “pay expenses (salary) referred to in that (a previous) paragraph which shall be exempt and separate from any limitations on the Department regarding full – time equivalent positions and travel.” Reads like a ‘ticket to ride’ to me! So, why won’t HUD execs appoint a noncareer administrator who’ll convey MHIndustry’s pressing concerns onto the Department’s policy level, rather than continuing to rely on a career employee to do so? They’re not saying, and I have a copy of the letter that makes that point very clear.

But all is not lost! There are indeed bright signs in and about the MHIndustry and LLCommunity asset class! In summary, here’re some of the emerging and existent new trends:

• In the face of little to no chattel (personal property) mortgage sources of funds, many LLCommunity owners, large and small, now actively market and sell new and resale homes on – site, often self – financing them in either a ‘captive finance’ fashion (i.e. where third party collects mortgage payments and services the loan) or a ‘buy here – pay here’ format, in which the property owner does so.

• Nearly three dozen Business Development Managers (‘BDM’), since early in 2009, have ably represented more than a dozen HUD Code home manufacturers, building their firm’s market share of new HUD Code homes sold into LLCommunities nationwide! For a free list of these BDMs, call (317) 346-7156.

• For the first time in years, MHRetailers are actively seeking out and buying small to mid – sized LLCommunities in relatively close proximity to their salescenters. Why? The land & home business has about dried – up for the time being, for obvious reasons, and MHRetailers are relearning the LLCommunity business they’ve ignored, for the most part, for the past decade.

• As more and more major HUD Code home manufacturers liquidate, new HUD Code home manufacturers are springing up around the country. One of the most notable recent startups is ADVENTURE HOMES in Garrett, Indiana. The firm ships into 14 states and boasts the most competitive pricing in the HUD Code market today, with 14X70 singlesection homes starting at $15,995 (net pricing) and multisection homes beginning at $19,995. Interested? Call (877) 510-1955 and talk to Greg Pinckney, account sales manager.

And yes, there’re even more timely and motivating examples, but we’ll leave them for Chapter # 3 or this manifesto cum jeremiad description of the MHIndustry in the January 2010 issue of the Allen Letter professional journal for businessmen and women! You don’t want to miss this budding opportunity to help reform and rejuvenate our industry for the 21st Century! Subscribe today.

*****
End Notes.

1. Jeremiad = lamentation, a complaint

2. Quoted from Unofficial Compilation Prepared by NCSBCS: Title VI as amended by the Manufactured Housing Improvement Act of 2000, page # 1.

3. Ibid, Authority to Collect Fee, page # 15.

George Allen, Realtor®, CPM®, MHM®
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class

George Allen’s Official Info Blog, for the MHIndustry & LLCommunity Asset Class! Available only at the MHIndustry & LLCommunity website: community-investor.com
or contact the author/blogger via (317) 346-7156 &r Box # 47024, Indpls, IN. 46247

What Will the Landlease Community Asset Class Look Like by Year 2020 ?

‘A Retrospective View of the Past Decade & Present,
Envisioning Our Business Model in the Future!’

Special Insertion Announcement. This Blog form

did not allow 2010 & 2020 columns to appear,

so – if you want ‘complete blog’, call (317)346

7156 or email gfa7156@aol.com and request it

for Free.  George Allen, CPM & MHM

Most landlease (nee manufactured home) community aficionados know and tout Manufactured Housing Institute’s (‘MHI’) National Communities Council (‘NCC’) division, founded in 1996, as primary national representative of, and advocate for, the estimated 50,000 properties comprising this unique real estate asset class. Not as many folk, however, are as familiar with Urban Land Institute’s (‘ULI’) Manufactured Housing Communities Council (‘MHCC’), founded during 2004, & widely viewed as the income – producing property type’s de facto Think Tank, comprised of many of the brightest and best landlease community (‘LLCommunity’) owners/operators in North America.

On November 3, 2009, 40+/- members and guests of the MHCC, half of whom were NCC members, convened at Westin Market Street Hotel in San Francisco, CA., for a daylong meeting. Key presentation & discussion topics highlighted morning agenda:

• Selling the Benefits of Landlease Communities in a Challenging Economic & Legislative Environment, facilitated by Joe Adams, PHC, and president of The Housing Marketplace in Ashville, NC.

• Stop the Attrition: Resident Retention from Landlease Community & Apartment Perspectives, jointly presented by Bill Cramer, CPM® & MHM, from Pittsburgh, PA., & Gene Powell, CPM® of Bend, OR.

• Are You Reaching Your Customer? Using Social Media & Search Engine Optimization to Maximize Your Company’s Marketing Effectiveness, led by Tim Ware, owner of HyperArts, from Oakland, CA.

The most stimulating group discussion of the day, however, occurred during the lunch hour when Randy Rowe, founder and chairman of Green Courte Partners, LLC, headquartered in Lake Forest, IL., challenged landlease community owners/operators to imagine and defend what they think our unique income – producing property type business model will look like in ten years, by year 2020!

As was soon determined; one way to approach this challenge, is to ‘look back’ as we ‘looked forward’- from today, identifying changes – or not, relative to specific foci; which in turn, might serve as precursors to what could materialize during the next ten years, to nearly 2020. Here’s the Baker’s Dozen focus areas we identified and discussed:

1999 2009 2019

1. 80%+ multisection homes increasingly more continuation of this
& 20%- singlesection singlesection homes affordable trend

2. prevalence of land/home prevalence of on – site on – site brokerage of
packages among retailers sale of new & resale homes new & resale homes

3. abundance of chattel $ scarcity of chattel $ chattel $ on – site via
lenders & cash flow

4. ‘developer series’ homes ‘community series’ homes rehab of all homes
by design for land/home by design for LLCommunity already on – site

5. vacant rental homesites prevalence of on – site LLCommunities as
filled by MHRetailers sales via BDMs* & staff as new MHRetailers

6. consolidation of retailers regional more than national continuation of
& LLCommunities LLCommunity consolidation consolidation

7. relatively few ‘park’ more publicity relative to continued pressure to
closures across U.S. ‘park’ closures & ROCs* close or convert ROC

8. traditional print ads widespread web marketing web marketing and
social networking

9. home manufacturers = LLCommunity owners = shared influence and
major influence & $ emerging influence & $ leadership of industry

10. good LLCommunity $ some LLCommunity return to widespread $
& occupancy health foreclosure & forbearance & occupancy health

11. no- to- few RV parks in the many RV parks now in the continued presence of
MH rental homesite mix MH rental homesite mix the RV/MH site mix

12. no-to-few rental homes increasing number of rental no-to-few rental
on – site in LLCommunities homes in LLCommunities homes in LLComm.

13. OK demographics with waiting for newlyweds to great demographics
‘newly weds/nearly deads’ return & ‘boomers’ retire! from young to old!

To be sure, there’re additional business foci we could have- maybe should have, given more time, been included on this interesting list, e.g.

• Major influence & presence of CMBS* in 1999 – but no longer a factor. Future?

• The evolution – or not, of new HUD Code home installation standards and enforcement procedures, especially as this matter relates to passage of the Manufactured Housing Improvement Act (‘MHIA’) of 2000 – yet to be fully implemented, (Yet another apropos ‘business focus!) intended to segue our industry from the ‘trailer business’ to the ‘housing business’

• We’ve gone from a half dozen print trade press publications to three in just one year; but are seeing emergence of online ezines and newsletters. Staying power?

• Decreasing support for regional home shows (e.g. demise of Midwest MHShow in Louisville, KY) to state – hosted symposiums/showcases of new homes

• Professional property management too continues to evolve, from the thin presence of 250 CPMs®* in 1999, to200 ACMs®* and nearly 1,000 MHMs* today. Next?

• And how ‘bout these two perennial bugaboos: good & bad industry image, and increasing government regulation at all levels?

Yes, all these beg that seminal question: ‘Where will these 21, and additional, foci be by year 2020?

This has been an inside look at what goes on in an industry Think Tank manned by individuals whose livelihoods, careers, fortunes, and business success or failure, depends on well – knowing: ‘Where we’ve been’, ‘What we’re about today’, and Where we surely hope to be tomorrow!’ If you’d like to become involved in these timely and strategic discussions, consider joining MHI’s NCC, as a direct dues – paying member, by phoning Thayer Long @ (703) 558-0678. And for membership information relative to ULI’s MHCC, contact Joanne Stevens, CCIM® & ACM® via (319) 378-6786. How’s this for a BONUS? During mid – April 2010, both groups will officially combine their Spring meetings at MHI’s annual Manufactured Housing Congress in Las Vegas! If you’re truly active in the LLCommunity asset class, you can hardly afford NOT to be present, doing your part to influence the present and future of the MHIndustry and our real estate asset class. For information on this historic event, again, contact Thayer Long at the aforementioned phone number or via www.manufacturedhousing.org

This too, is a working document for the HUD Code manufactured housing industry and landlease (nee manufactured home) community real estate asset class! If you’d like to input your thoughts, ideas, suggestions, critique, etc., prior to the above – announced joint meeting of the NCC & MHCC, contact Thayer Long, Kenny Lipschutz (chairman of the MHCC) of Brookside Communities in MI. @ (248) 645-1077, or the author of this feature.

End Notes:

• BDM Business Development Manager of HUD Code home manufacturer
• ROC Resident Owned Community, usually as cooperative or condo
• CMBS Commercial Mortgage Backed Securities
• CPM® Certified Property Manager member of the Institute of Real Estate Management (‘IREM’)
• ACM® Accredited Community Manager certification designation via auspices of the Manufactured Housing Educational Institute (‘MHEI’)
• MHM® Manufactured Housing Manager certification designation via auspices of PMN Publishing

George Allen, Realtor®, CPM®, MHM
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class

Box # 47024
Indianapolis, IN. 46247
(317) 346-7156

Visit his website: www.community-investor.com and Blog
Email: gfa7156@aol.com

What follows is an edited version of email correspondence recently received from a veteran portfolio owner/operator of landlease (nee manufactured home) communities.

                                                             *****

“Know what George? If I had the opportunity to sit down and ’talk shop’ with  Kevin Clayton, president & CEO of Clayton Homes, Inc., here’s what I’d say and suggest to him, then patiently await his reply”:

             ‘Tell me if I’ve got this right. Vanderbilt Mortgage and Finance, Inc., and 21^st Mortgage Corporation, finance HUD Code manufactured homes; the former, financing said homes only for Clayton retail salescenters; the latter, financing these homes for everyone else, maybe soon via the newly revised FHA program. Meanwhile, 21^st Corp’s chattel finance program isn’t very popular with LLCommunity owners, given its’ plethora of contractual ‘gotchas’.

            It’s also my understanding, Vanderbilt isn’t financing many manufactured homes these days, because their underwriting guidelines (i.e. credit score, income/debt ratios, down payment) are so tight – to cover cost of possible defaults and repossessions, prospective Clayton homebuyers are opting to buy foreclosed-on, stick–built houses for $.50 on the dollar. Result? A greatly reduced demand for new manufactured homes!

Amidst all this, I know more than a few landlease community (‘LLCommunity’) owners interested in becoming bona fide Clayton retailers; willing and able to sell the firm’s new ‘community series’ homes on–site, with chattel financing provided by Vanderbilt Mortgage and Finance, Inc.

Given the accuracy and timeliness of the previous paragraphs, why wouldn’t  Clayton Homes and Vanderbilt Mortgage be interested, even eager, to craft a new and unique business model that’d…

1)      Sell and finance many more affordably-priced new ‘community series’ manufactured homes, via Clayton–affiliated retail salescenters located within LLCommunities!

2)      Ensure LLCommunity rental homesite fees are in sync with other forms of ‘for sale’ and rental housing in the same local housing market; and, new home price points are truly affordable, in relation to the prevailing Area Median Income (‘AIM’) per postal zip code; all with the aim of getting the ‘site rent meter running’ via increased occupancy!

3)      Adequately protect financial interests of the lender, regarding these homes, via written agreement with the LLCommunity owner, so mortgage underwriting guidelines can be relaxed and more homes sold!

If interested in discussing this further, Kevin; let me know, and I’ll bring along other veteran LLCommunity owners who’ve already expressed strong interest in creating this  WIN – WIN – WIN  (i.e. manufacturer – lender – property owner) partnership!’   SR

                                                           *****

Know what? This new and unique business model isn’t a novel concept, not by a long shot. It was broached earlier this year, shortly after Clayton Homes named its’ first two Business Development Managers (‘BDM’*), and about the time the firm introduced its new E Home (nee Evolution series home). Interest is there! But at least one implementation challenge lies with Clayton in-house retailers eschewing ‘new home sale competition’ from what they perceive as interlopers, LLCommunity owners with Clayton-affiliated retail salescenters on–site.  It’ll be interesting to see if and how Kevin responds to this earful.

What are your thoughts about this lively matter? Good or bad for the MHIndustry & LLCommunity asset class, and why? Always appreciate your critique and input.

End Note.      For a free list of all BDMs marketing HUD Code manufactured homes into LLCommunities, call (317)346-7156 and request it.

                                                           *****

George Allen via or gfa7156@aol.com or the MHIndustry HOTLINE:

(877)MFD-HSNG or 633-4764 or via GFA c/o Box # 47024, Indpls, IN. 46247

                                                           *****

Ever plan a party and not have everyone show up? Worse; ever schedule or facilitate a business education and networking event, only to find those ‘who need it most’ absent? Well, if you answered the second query with a ‘Yes’, you’ll understand and appreciate the frustration embodied in the following paragraphs…

This particular annual multi-state association business, education and networking meeting was not my event. However, I’d been asked to deliver the keynote ‘State of the Industry & Asset Class’ address one day, and the same educational session twice the following day. Don’t misunderstand; overall meeting attendance was healthy, with more than 200 businessmen and women present, and 50 eager learners in each of the two like sessions I taught.

But here’s the rub. With HUD Code manufactured housing experiencing an historic nadir of annual new home shipments, and many of the asset class’ largest landlease communities struggling with high turnover and marginal occupancy levels – in large part due to too high rental homesite fees, it’s time to face and resolve perennial image, finance, and customer service issues! But guess what? Some, no – make that several, of the most notorious issue offenders, though invited and encouraged to participate in this timely regional affair, declined to do so!

Why? I doubt we’ll ever know for sure, but I’m confident their reason or reasons are included among the following excuses, as they…

• View themselves as being ‘above the fray’, even while suffering along with their peers; but counting on the business cycle to eventually return them to prosperity

• Know it all! After all, they’ve been in business for decades, if not family generations; so what could they possibly learn from or with their peers?

• Have heard and tried or discarded ‘corrective formulae and solutions’ before, so figure there’s nothing new to learn under the sun.

• Have been enthused, in the past, with ‘one or another or more’ regional and national business improvement initiatives, only to watch them die – for a variety of reasons (e.g. lack of funding, focus dispute, even selfish feuding), before ever getting started.

The unfortunate truth is, with sole exception of the last excuse, they were wrong not to attend and learn, as well as support their state trade presence! A special effort was made by meeting planners – and maybe just inadequately communicated, certain key performance indicators, in some cases mathematical formulae and models, would be shared ‘for the first time’, enabling attendees to evaluate present business holdings against industry and regional norms (e.g. homesite rent level ‘acid test’; an Industry Standard Chart of Accounts with Operating Expense Ratios or OERs); and, how to affordably price new and resale homes marketed on site in LLCommunities, using AGI (annual gross income) or AMI (area median income) as starting points; and, ‘How to Negotiate an Effective Three Party Financial Partnership Among One’s Local Bank or S&L, MHRetailer, and Landlease Community Selling New & Resale Homes On-site!

Frankly, this insider, and previously proprietary, confidential information deserves as broad and timely coverage as possible. Encourage your state MHAssociation executive to plan and host a one or two day Super Symposium & Showcase of New HUD Code Homes during 2010! For meeting planning guidance, contact George Allen, CPM & MHM @ (317) 346-7156 or Jim Keller of IMHA/RVIC in IN. @ (317) 247-6258X12.

End Note.

* lament, as to ‘regret’. Webster

George Allen’s Official Info Blog for the MHIndustry & LLCommunity Asset Class!

PRINT & SAVE THIS BLOG – for your use today, tomorrow & beyond!

Title:

‘Influencing What Does & Doesn’t Happen
to the MHIndustry & LLCommunity Asset Class’

Whether a veteran purist, dedicated Luddite, or forward–looking visionary in the HUD Code manufactured housing industry – or sister segments sometimes called the ‘aftermarket’, and the landlease (nee manufactured home) community real estate asset class, YOU have a responsibility to influence what does and does not happen to all of US! And now, given the content of this Info Blog, here’s a practical resource with which to truly influence what does and doesn’t happen to US! The question is; are you, and will you, exercise this ‘responsibility to influence’, on regional and national business scenes through active participation in state and national MHAssociations and other means; or just lie back, content with what’s going on around you; or at worst, pursue proprietary MHBusiness interests with no ‘giving back’ to the industry and asset class where you make your living?

Following are the major opinion shapers, government lobbyists, trade bodies, and education outlets serving the MHIndustry & LLCommunity asset class. The list is near complete and comprehensive. Think someone or something is missing? Maybe they are. But ask yourself; ‘When was the last time I saw or heard said entity present and working on behalf of our industry and asset class on the regional or national scene?’ Following bodies are not listed in any particular order:

• Manufactured Housing Association for Regulatory Reform (‘MHARR’), a.k.a. MHIndustry’s ‘watchdog’ in Washington, DC. Comprised only of HUD Code home manufacturers & interested state MHAssociations. (202) 783-4087. Danny Ghorbani. Call & ask to receive their periodic FAX messages & reprints.

• Manufactured Housing Institute (‘MHI’), headquartered in Arlington, VA. Advocates in behalf of every segment of the HUD Code manufactured housing industry, including most state MHAssociations. (703) 558-0400. Thayer Long. Call to join the organization and attend periodic meetings during the year.

• National Communities Council (‘NCC’) division of MHI. Sole representative for 50,000+/- LLCommunities throughout the U.S. & sponsors an NCC Forum @ MHI’s annual MHCongress in Las Vegas. (703) 558-0678. No director at this time. Most effective means for LLCommunity owners to influence their future!

• Urban Land Institute’s Manufactured Housing Communities Council (‘ULI’s MHCC’) in Washington, DC. Described as MHIndustry’s de facto ‘Think Tank’ and LLCommunity owners/operators’ ‘foot in the door’ with U.S. land developers (248) 645-1077 Call Kenneth Lipschutz, chairman, to join ‘best & brightest’.

• Manufactured Housing Educational Institute (‘MHEI’) education arm of MHI; developing and effecting trade training programs for MHRetailers, LLCommunity managers (e.g. ACM) & others. (703) 558-0400 Ann Parman or chairman Joe Adams @ (828) 891-3911. Suggestions for a webinar & other training programs?

• Community-Investor.com nee PMN Publishing. Sole source of professional property management, development, and investment textbooks, standard forms, and Manufactured Housing Manager (‘MHM’) certification, all geared to LLCommunity asset class. (317)346-7156. Susan McCarty

• Manufactured Housing Executives Council (‘MHEC’), de facto council serving state MHAssociation executives; meets during MHI meetings. (919) 872-2740. Brad Lovin, chairman. This is the body to encourage to participate in national trends like the Super Symposium & New Home Showcase, on the state level!

• Factory–Built Owners of America (‘FBOA’) in TX. Sole quasi – consumer (i.e. manufactured home owner) & MHBusiness body actively working to bring these parties together in a positive fashion through education and communication. (210) 258-1674. Contact Deb Ahrens to join and receive their newsletter.

• The RV/MH Heritage Foundation, Inc., Elkhart, IN. The only legacy body in North America preserving the history of the RV & MH industries and their respective realty ‘aftermarkets’. Annual Hall of Fame induction banquet in August at the museum, library facility. Donate $! (574) 293-2344. Carl Ehry

• Systems Building Research Alliance (‘SBRA’) in NY, is a non–profit organization developing new technologies to enhance factory–built structures. Think: the SOILS Project! Have ideas or questions? Give them a call! (212) 496-0900. Emanuel Levy, director.

• Small Community Owners Forum (‘SCOF’) in IA, not a formal, organized body at this time, but the beginning of a national presence for owners/operators of ‘100 sites and smaller’ LLCommunities. (319) 378-6786. LLCommunity owner Joanne Stevens, ACM, PHC, CCIM. Contact & encourage her to this end!

• ‘Community series’ manufactured homes. Another recent, needed debut on the national MHIndustry scene. Donald C. Westphal of MI., heads this timely effort to research, document, and describe the unique sizes, features and specification characterizing new homes to be sited within LLCommunities. (248) 651-5518.

• Annual ALLEN REPORT is undergoing gradual transformation. For 20 years it’s been: ‘Who’s Who Among LLCommunity Portfolio Owners/operators in North America!’ Efforts afoot to take its’ benchmark statistics to a higher level. To help? Contact George Allen (317) 346-7156 & Bruce Nell (614) 540-2950.

• Business Development Managers (‘BDM’), a national trend among HUD Code home manufacturers to market more new homes to be sited in LLCommunities. No formal organization, but Official BDM list is updated several times each year. Want to be included? Call (317)346-7156.

• George Allen’s Official Info Blog for MHIndustry & LLCommunity Asset Class. Only electronic cum print, business to business, trade media compiled and published daily (via email), weekly (via this blog) & monthly (via Allen Letter & the Allen CONFIDENTIAL!) by a Realtor®, CPM® & MHM® fully engaged nationally, in this industry and asset class, for 30 years! (317) 346-7156.

Know what? There’re additional organizations, trade bodies, and business entities that could be included in this ‘responsibility to influence’ enabling list. And perhaps, when the day comes that these groups step forward from the manufactured housing underground, where they educate about ‘mobile home parks’ and publish material by folk not associated with the MHIndustry & LLCommunity asset class, and become actively involved, as dues–paying members, in existent trade organizations, trade bodies and business entities that influence our collective future, we can double this list in size! If you know of any of these folk, encourage them to become ‘influencers’ on the national scene…

As usual, your response, critique, and suggestions are welcome!

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

Official State of the MHIndustry & LLCommunity Asset Class!

The unabridged title of this frequently requested public presentation goes like this:

‘Present State of the HUD Code Manufactured Housing Industry & the Landlease (nee manufactured home) Community Real Estate Asset Class!’

At least for the time being, HUD Code manufactured housing is returning to its’ affordable housing roots. How so? It’s a long but interesting story with some twists and turns…
From the mid 1940s thru mid – 70s, 80+/% of annual new home shipments (Remember, we count ‘shipments’ in this business, not new homes sold) were ‘singlewide’ mobile homes and 20+-% ‘doublewides’; and, 80+/-% of said homes were destined for siting in ‘mobile home parks’, the remaining 20+/-% on scattered building or subdivision sites owned fee simple. Note. This was a 30+/- year period in U.S. housing history when the concept and term ‘affordable housing’ meant affordable housing and a truly affordable lifestyle!

25 years later, by year 2000, those percentages reversed! Now 80+/- of annual new home shipments were ‘multisection’ manufactured homes and 20+/-% were ‘singlesection’ homes; and, 80+/-% of said homes were destined for siting on scattered building or subdivision sites owned fee simple, and generally referred to as Land & Home Packages; the remaining 20+/-% of new homes went into manufactured home (nee mobile home park) communities. Why? Our unique, homegrown type of factory–built housing had become more ‘homelike’ over the years and increasingly desirable to the homebuying consumer, who could not afford the $200,000.00 price tag on new site–built homes, and chattel (personal property) loan financing was plentiful. Note. This was also the 25 year period in U.S. housing history when the concept and term ‘affordable housing’ became bastardized, to mean whatever government bureaucrats and housing marketers, activists, academics, and journalists wanted it to mean, at the time, and for whatever selfish purpose – but all to the detriment of the homebuying citizen!

Another decade has almost passed, and the two 80/20 percent manufactured housing configuration and siting paradigms, referenced in the preceding paragraphs, are reversing again! That’s right, the number of new singlesection manufactured homes continues to increase while the number of multisection homes decreases. And an increasing volume of new manufactured homes, both singlesection and smaller multisection models – now commonly referred to as ‘community series’ homes*1, are purposely marketed into landlease (nee manufactured home) communities by dozens of Business Development Managers (a.k.a. ‘BDM’s) working for a dozen or so of the remaining HUD Code home manufacturers – more about this later. Why? First; the scattered and subdivision building site market has dried up, for a variety of mostly financial and economic reasons, for the time being; yet, there are an estimated 500,000 vacant rental homesites to fill in the approximately 50,000 LLCommunities in the U.S. today! And smaller manufactured homes are inherently more ‘affordable’ than behemoth multisection models; and certainly fit better, on otherwise functionally obsolete rental homesites within these unique income–producing properties. Furthermore, owners/operators of these ‘recession proof’ properties know, if willing to take on more risk and pay closer attention to daily management operations, they can ‘add value’ to these properties by acquiring, reselling and self–financing new and resale homes on–site within their properties. Note. It’s futile to define or describe ‘affordable housing’ these days, as the same players cited in the previous paragraph, refuse to acknowledge and correct their gross perfidy applying this key and timely housing concept–making it a near useless benchmark in today’s housing marketplace.

So, are there key, and otherwise important trends associated with the aforementioned paradigm shifts within the HUD Code manufactured housing and landlease community real estate asset class? Yes there are….

Many LLCommunity and MHIndustry purists date recognition of this latest shift – now – trend, to the 27 February 2008 National State of the Asset Class caucus held at FountainView Estate LLCommunity in Tampa, FL. 100+.-, when LLCommunity owners/operators attended. Result? A five part Action Plan to revitalize the asset class and, hopefully, breathe ‘home sale life’ into a severely contracted MHIndustry. One action area involved opening lines of communication between LLCommunity owners/operators and MHIndustry manufacturers.

One year later, to the day, 100+/- HUD Code home manufacturers representatives and LLCommunity owners/operators convened at the RV/MH Heritage Foundation’s Hall of Fame, Museum and Library in Elkhart, IN. for an Historic SUMMIT Meeting. Most of that day, 27 February 2009, was spent discussing ‘back and forth’ what the former could build and ship; and what the latter needed and desired on–site in their properties. Result? The soon redesign of housing product to be ‘LLCommunity–friendly’, now known as ‘community series’ homes. Read on…

Also during late 2008 and throughout year 2009, another emerging phenomenon, maybe someday to be identified as a paradigm shift, has taken root. Beginning simply as a Super Symposium, early venues were day long events, in IN, OH, GA, & IL., where LLCommunity owners/operators, lenders and third party finance specialists, and HUD Code home manufacturers convened to learn together ‘How to Market, Sell, and Self–finance New and Resale Homes On–site in LLCommunities!’ Now that basic seminar agenda has morphed into a multi–day affair, featuring not only education, but supplemented with several new HUD code ‘community series’ homes on display for participants to inspect, with the expectation they’ll order new home stock for placement on–site in their properties. Such Symposium/Showcase events have recently been held or are planned in IL, GA, NY and TX. Is your state planning to revitalize our industry and asset class in like manner? Perhaps you should contact your state executive and suggest they do so.

At the same time, several regional mega MHShows have become casualties of marketing and finance ill effects of the two (HUD Code & site–built) housing boom–bust cycles here in the U.S. The annual Midwest MHShow in Louisville, KY, is the latest decades–old event to fold.

So, are there any other realities and trends afoot affecting the MHIndustry and LLCommunity asset class? While time and space, here, does not facilitate discussion, they include:

Lack of floor plan (wholesale) financing for HUD Code manufactured homes
Paucity of qualified prospective homebuyers for manufactured homes
Lack of strong, unified national advocacy @ MHI & MHARR
No widespread manufactured housing ‘resale market’…valuation, multilist…
No national ‘image improvement’ & or ‘product promotion’ campaign to date
Diminished trade press presence with demise of Merchandiser & Modern Home
Uneven implementation of HUD home installation and Safe Act regulations
Future uncertainty of MHIndustry by dint of continued corporate consolidation
Slow growth of MHI’s National Communties Council division
Uncertain role of ULI’s MHCC ‘Think Tank’ for MHIndustry & LLCommunities
Lack of support for property management professionalism re CPM, MHM, ACM
Emergence of a Small Community Owners Forum at the 18th annual Roundtable

Believe it or not, there’s still more that could be included here. As usual, I appreciate your feedback. Hopefully you’ve made this Blog, at www.community-investor.com your Monday touchstone for all things pertaining to the MHIndustry and LLCommunity asset class! Let me know your feedback on these key matters….

End Note:

1. Don Westphal serves as the national clearing house for developing standard descriptions relative to the ‘community series’ home designs and configurations: (248) 651-5518.

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

Blog # 55

Birth & Maturation of a HUD Manufactured Housing & LLCommunity Trend.

“Every (landlease) community owner is dealing with the same issues we face in Georgia: need for low – priced manufactured homes with sex appeal AND financing, to fill vacant rental homesites! Today, HUD Code home manufacturers are going to a lot of trouble to listen to our requests, then designing and building new homes we want, even displaying them at our meetings. Other topics, like professional property management, on – site sales expertise, and sources of funds for home financing, are also near and dear to the hearts of everyone in the manufactured housing business.” (Paraphrased email message from GA. GFA)

Two years ago, the first sentence of the opening paragraph rang true, as landlease (nee manufactured home) community owners/operators ‘added value’ to their unique income – producing properties by selling ‘repo’ and used homes on – site. However, the new reality described in the next sentence received little more than lip service, at the time, from HUD Code home manufacturers enamored by the ‘bigger box = bigger bucks’ business model of the MHIndustry. Today, that has changed in a big way. How?

First, let’s set the stage. There’re approximately 500,000 vacant rental homesites among 50,000+/- landlease communities (‘LLCommunities’) throughout the U.S. The majority of these are smaller, oft singlesection home – sized sites in 10 – 40 year old LLCommunities, and unable to support the ‘bigger box = bigger bucks’ mantra of a decade ago. And, between 1998 and 2008, HUD Code housing shipments plummeted from 372,843 to 81,889! What’s happened to change that mantra?

Nearly two years ago, on February 27, 2008, 100 LLCommunity owners and operators, from throughout the U.S., convened in Tampa, FL., for their first National State of the Asset Class caucus. One of Five Action Areas identified at that caucus of peers, was the mandate to ‘Get HUD Code home manufacturers and LLCommunity folk talking to each other!’ Well, it took a year, but we finally reconvened at the RV/MH Heritage Foundation Hall of Fame, Museum & Library facility….

On February 27, 2009, in Elkhart, IN., 100 HUD Code home manufacturer execs and LLCommunity owners/operators gathered for an Historic SUMMIT Meeting. What occurred? Open communication between these two major segments of the MHIndustry, and the naming of nearly three dozen Business Development Managers (‘BDM’) by those manufacturers present, with the mandate to ‘Increase their firms’ new home sale market share within and throughout this real estate asset class!’ The trend is born!

On September 10 & 11, 2009, in Chicago, IL., 200 portfolio owners/operators of LLCommunities, again from throughout the U.S., gathered for their 18th annual International Networking Roundtable (‘INR’). Besides spending time in seminars learning how to better market and sell new and resale homes on – site, everyone toured and inspected three new HUD code homes on display! These new single and multisection ‘community series’ homes were supplied by Clayton Homes, Harmony (Fairmont) Homes, and Hi – Tech Housing. And new homes were ordered!

On December 16th, in Forsythe, GA., at least five HUD Code home manufacturers will display new ‘community series’ homes in the hotel parking lot where GMHA is hosting Symposium II. This will be at least the sixth joint HUD Code manufacturer & LLCommunity event conducted during 2008, with others in IN, IL, OH & GA! During symposiums, LLCommunity folk learn ‘How to Market, Sell & Self – finance Homes On – site!’ and HUD Code home manufacturers get to showcase their new lines of community series’ homes! FYI; symposiums are being planned in NY, TX and elsewhere. Encourage your state MHAssociation to participate in the Symposium & Showcased ‘community series’ Homes trend’ during 2010!

There’s an interesting, evolving sidebar regarding this Symposium & Showcased ‘community series’ Homes trend’. MHIndustry veterans know regional (and some state) manufactured housing shows have long been a primary means of introducing new home designs and features to mostly manufactured housing retailers (nee dealers) and developers. These mega – events were very ‘high cost’ (transportation, setup, space rental, etc.) for home manufacturers, and the treasuries of sponsoring MHAssociations oft shared (large) profits post – show. Today, that has changed. With new home shipments down 450 percent, between 1998 and 2008, manufacturers cannot afford these high – priced venues, and appreciate opportunities to setup and showcase ‘community series’ product near their factories, to the most likely buyers in the housing market today – LLCommunity owners/operators.

So maybe, until across – the – board housing demand and national prosperity returns, this contemporary Symposium & Showcased ‘community series’ Homes trend, comprised of LLCommunity owners/operators and HUD Code home manufacturers working together to fill approximately 500,000 vacant rental homesites in 50,000+/- properties nationwide, is ‘the best and only way to go!’

End Note. As always, I appreciate your feedback on every Blog I pen in behalf of the MHIndustry & LLCommunity asset class. Your reaction and comments to this one?

*****

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

Blog # 54, a.k.a. Postscript to the Allen CONFDENTIAL!, Issue # 121

MHI’s annual, & NCC’s division meetings ‘in a nutshell’, so to speak….

First the Good News. Overall attendance at this year’s annual meeting at La Costa Resort Hotel & Spa, in La Costa, CA., was up by 50 percent! Not So Good News?
Only 11 state MHAssociation execs were present (e.g. none from Pacific Northwest or New England, & only one each from Middle Atlantic States & Midwest!); only six HUD Code home manufacturers (with a couple of those brands were from same corporate family); but, there were more than 20 LLCommunity owners/operators present!

Meet Potomac Partners, LLC. The only firm to receive an RFP (Request for Proposal) from MHI to find “…adequate financing for land-lease (sic) community manufactured housing (‘MH’) loans…” To request a copy of their four page Proposal, contact Thayer Long @ (703) 558-0678. To offer information, or to offer assistance to this firm, contact Brian Chappelle or Pete Mills via (202) 637-7020.

Industry Panel Discussion. Promoted as ‘one session you will not want to miss’, a panel comprised of seven industry experts from manufacturing, finance, and LLCommunity segments of the MHIndustry, moderated by Dick Ernst, shared their ‘sector’s biggest business challenges and strategies for overcoming them.” While interesting presentations, nothing about the 36 Business Development Managers (‘BDM’) marketing new HUD Code homes into LLCommunities these days; or the National Symposium Movement, already in evidence in IN, OH, GA, IL – and maybe TX, as well as regional trade shows; and, the newest industry moniker ‘community series’ homes, received but passing mention during Open Discussion at very end of the program. Sometimes seems like there’re two manufactured housing and landlease community industries afoot these days.

National Communities Council meeting. Once again, the most heavily attended industry segment meeting of the entire MHI annual meeting. Much discussion concerning pending legislation in Washington, DC. For latest information go to MHI’s website and access the NCC portion thereof. What else covered? Stephen Wheeler, formerly with Green Courte Partners, introduced his new firm Housing Advisory Services and explained what’s happening there (See brochure enclosed with this issue of TAC!) I distributed a summary of newsy notes already covered in this issue of TAC!

Manufactured Housing Educational Institute board meeting. I suggested MHI explore the possibility of adding several new HUD Code homes to the 2010 MHCongress in Las Vegas, NV as display models, like we did at the 18th annual Roundtable last month. Since a theme had already been selected for the 2010 event, this suggestion went unheeded – unless the NCC Forum committee picks up on it: ‘How to Market, Sell & Self – finance New & Resale Homes On – site in LLCommunities Nationwide!’ Would you attend such a seminar program? Thought so. I certainly would, especially during these trying economic times for our industry and asset class. Guess we’ll have to wait and see…