Archive for December 15th, 2013

Order ALLEN REPORT, Use Lease-Option!?

Sunday, December 15th, 2013

Blog Column # 275 Copyright 2013 15 December 2013

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

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

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

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

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

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

I.

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

II.

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

III.

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

I.

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

A.k.a.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

II.

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

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

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

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

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

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

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

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

The Good News is what deserves our attention here.

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

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

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

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

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

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

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

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

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

III.

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

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

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

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

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

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

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

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

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

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

***

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