Archive for December, 2014

Manufactured Housing to the Rescue & a Personal Message

Wednesday, December 31st, 2014

COBA7® via community-investor.com Blog # 330 Copyright @ 4 January 2015

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the primary national advocacy voice, official ombudsman, research reporter, & online communication media for all LLLCommunities in North America!

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance®, a.k.a. COBA7®, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 63304764

Introduction to this week’s COBA7® blog posting at community-investor.com website:

I.

Rare have been opportunities, to directly address needs for increased ‘home ownership’ & ‘affordable rental housing’ by a HUD secretary. Well, such an opportunity is now; and hopefully, HUD Secretary Julian Castro will read this blog posting, Believe & Respond!

II.

I’m not good at baring my soul in public, certainly not on the internet. But I was inspired recently, to finally understand the import of ‘WHY I do what I do’, for friends& peers owning/operating LLLCommunities in the U.S. & CN. Hope You Sense the Passion!

I.

Manufactured Housing to the Rescue!

HUD Secretary Julian Castro’s dilemma: How to 1)‘spur homeownership while promoting more 2) affordable rental housing’? The answer is simple: HUD to promote 1) new HUD-Code manufactured housing, sited as ‘rental homes’ &/or ‘contract sale’ units, on 2) rental homesites within 50,000+/- land-lease-lifestyle communities (a.k.a. manufactured home communities) located throughout the U.S. today! Hey, HUD already regulates us!

First, a little background. In a recent feature article, titled FINDING EQUILIBRIUM, in the December 2014 issue of Multifamily Executive magazine, writer Lindsay Machak, describes HUD secretary Julian Castro’s dilemma in this manner:

“…the nation’s homeownership rate continues to decline – from a high of 69.2 percent in 2004 to today’s 64.4 percent. How can he spur homeownership at a time of tight mortgage restrictions while also promoting a more affordable rental market, as he recently discovered, is anything but affordable?” p.27

In the same piece, Stan Humphries, chief economist at Seattle-based Zillow, put this spin on the same matter:

“The fact we’ve ignored affordable rental housing for so long is coming to repercussion now for homeownership. Today’s renters are tomorrow’s buyers. The fact that rents are unaffordable makes it very hard for them to save up and get a down payment.” P.27

Neither writer likely has knowledge of key, timely, multiple, overlapping roles 1) HUD-Code manufactured housing; 2) land-lease-lifestyle communities in general; and 3) rental homes as well as ‘contract sale units’; and 4) rental homesites in particular, already and routinely play in ‘homeownership’ & ‘affordable rental housing’ scenarios! Do you? If you’re a LLLCommunity owner/operator, you almost certainly do, especially if you’re one of 500+/- property portfolio owners/operators, of whom 111 participated in a survey this Fall, to prepare the seminal 26th annual ALLEN REPORT (a.k.a. ‘Who’s Who among LLLCommunity Portfolio Owners/operators Throughout North America!’).

Here’s what we learned about ‘rental homes’ & ‘contract sale homes’ from statistics published in this latest ALLEN REPORT, distributed during January 2015, as a lagniappe in the Allen Letter professional journal.*1

“Slightly more than 40 (that’s 36 percent of the 111 reporting firms) LLLCommunity owners/operators report a total of 35,605 rental (manufactured) homes occupied on-site in their properties. Two mega-portfolio owners/operators alone report more than 10,000 rental units apiece! And when their combined 20,635 rentals are removed from the mix, it leaves an average of 374 rental units per property portfolio among the remaining firms. Then there’s this: virtually the same number of portfolio ‘players’ also report an average of 370 ‘contract sale’ (manufactured housing) units in place among the same properties! Bottom line? Manufactured housing rentals and contract sale units, at least this time around, are equally represented among 40+/- reporting property portfolios comprised of land-lease-lifestyle communities siting manufactured homes!” Quoted from email correspondence between GFA &o Carl Pearse, a Florida-based professional property manager, dated 19 December 2014.

Given HUD’s regulatory oversight of the manufactured housing industry since 1976, secretary Julian Castro probably already knows – or should have at least been informed by his MH administrator, Pam Danner, esquire, (She was emailed a copy of the previous paragraph in mid-December), that

1. On a cost per square foot basis, according to statistics published online by the Manufactured Housing Institute, the cost of HUD-Code manufactured housing, on the average, is at least 40 percent less than site-built housing, not including the value of underlying, improved realty.

2. Where rental homesite rent rates are concerned, many, if not most, land-lease-lifestyle community owners/operators attempt to keep monthly homesite rents at 1/3rd the amount charged by the largest 3BR2B conventional apartment or townhouse communities in the same local housing market, after adjusting for how utility charges are handled.

3. Reappearance, since around year 2005, of ‘rental homes’ and ‘contract sale’ units on-site in land-lease-lifestyle communities. This was a common phenomenon too, during late 1970s & early 1980s, as a means of ‘keeping the site rent meter running’, due to limited access to chattel capital to finance home sales on-site. Such home rental and contract sale arrangements, for the most part, are helpful and affordable states of affair for would be homeowners/site lessees who can’t afford housing elsewhere.

How so? Not only does the new housing product cost considerably less than site-built housing, but LLLCommunity owners/operators often sell new homes at close to the wholesale (plus freight & setup charges) prices they paid the factory, minimizing their profit margin(s). And if rental homesite rents, on occasion, appear to be exorbitant – and they can be, there’re usually other such properties in the same local housing market, charging less. Today, at least four major HUD-Code home manufacturers, including the Big 3-C home manufacturers, controlling 70+/- percent of national market share of factory-built housing, directly or indirectly, offer new home finance packages via LLLCommunity owners/operators. There’s only one thing missing; read on….

A summary of this business model goes as follows: Need affordable rental housing? Go to nearest LLLCommunity, where rental units are in place, and rent a manufactured home. Then, as one’s financial picture improves, convert home ‘renter’ to ‘homeowner/site lessee’, often remaining in the same home! This is happening day in, day out, in this unique, income-producing property type, throughout the U.S. However…

A key piece is missing from this timely and affordable housing business model: ‘Understanding, Backing, & Promotion’, by HUD Secretary Julian Castro – of the very shelter manufacturing program his department has been regulating for 39 years! And not only that, know there’re rumblings in the manufactured housing industry today, for some sort of widespread branding and advertising program, offering the affordable HUD-Code product and LLLCommunity lifestyle, to would be homebuyers/site lessees nationwide!

Secretary Julian Castro, are you listening? We have this multifaceted answer to your ‘homeownership’ & ‘affordable rental housing’ dilemma already in place. Now is the ‘Time to Talk to All of Us about It!’ *2

End Notes.

1. 26th annual ALLEN REPORT is available for purchase @ $544.95. Or, for the same $ amount, affiliate with the Community Owners (7 Part) Business Alliance®, or COBA7®, and receive said report, along with a year long subscription to the Allen Letter professional journal, & a dozen Signature Series Resource Documents, a.k.a. SSRDs: mix of directories, official state of the MHIndustry & LLLCommunity asset class, industry terminology glossary/lexicon, and popular Industry Briefing Sheet…To order, simply phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

2. Manufactured Housing Association for Regulatory Reform, a.k.a. MHARR @ (202) 783-4087 – Mark Weiss, esquire.

Manufactured Housing Institute, a.k.a. MHI @ (703) 558-0678 – Dick Jennison.

Community Owners (7 Part) Business Alliance®, a.k.a. COBA7® @ Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 (not a lobbying entity, but an alliance of land-lease-lifestyle community owners/operators in the U.S. & CN.) – George Allen, CPM®Emeritus, MHM®Master

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II.

A Personal Message from George Allen, to his Friends in the Manufactured Housing Industry

I now understand WHY I’ve been driven, for the past 35 years, to serve your information, resource, communication, networking, and training needs; as fellow LLLCommunity owner, property manager, consultant, author, newsletter writer, book publisher, meeting planner, and professional property management trainer/certifier. I’ve known from ‘day one’, in early 1980, I wanted you to have what was not available to me, as a first time property manager of (then) ‘mobile home parks’.

This realization was confirmed recently, on a couple pages in a book titled LeaderXShift, by Dr. Gary L. Johnson, Moeller Printing, 2013.

My epiphany was inspired by this statement: “Leaders must know their mission, protect their mission, and be willing to pay the price of fulfilling their mission – it’s all about ‘the why’.” My WHY, and Yes, it is!

Johnson goes on to paraphrase from a book written by Simon Sinek, Start With Why (2009), with this summary:

“…most companies and organizations approach business from the outside by first knowing WHAT they do, then knowing HOW they do business, and with only a few of the people knowing WHY they exist. The majority of their constituents (i.e. management, labor, shareholders, members, etc.) know WHAT products or services they provide, and some of the constituents even know HOW they are provided, but very few individual s know WHY they do what they do.” Pp.48 & 49

Sinek continues, “…effective companies and organizations (however), work from the inside out. The majority of their constituents not only know WHAT they do and HOW they do it, but importantly , they know WHY they exist. They know WHY they exist because these businesses and organizations start with why. They thoroughly and repeatedly communicate their why.” P.49

And I’ve tried to do ‘just that’ over the years, now decades. Sure, I could have likely ‘made more money’ concentrating on the real estate investment and fee management sides of our original business model at (the early) GFA Management, Inc., but I didn’t. When offered opportunities, in the mid-1980s, to write columns for The Journal and now defunct Manufactured Home Merchandiser magazines (also Community Management and Modern Home magazines too), I did so, in a sincere effort to share Lessons Learned as a young property manager, eventually as a (then) manufactured home community owner. At all times, ‘My WHY was My GOAL’: to assist peers in the manufactured housing industry, and owners/operators throughout the land-lease-lifestyle community asset class – beginning with the inaugural ALLEN REPORT back in 1988.

It’s now year 2015, and my ardor has not waned. If anything, My WHY has become stronger, now there’s a transition vehicle in place to ensure continued serving of my/our business constituency for years, yes decades, yet to come!

That vehicle? The Community Owners (7 Part) Business Alliance®, or COBA7®. It’s more than a year old now, with 200+ paid affiliates, a.k.a. MHInsiders on board. That number is expected to swell to 400 by year end 2015. Why? Because of ‘My WHY’ has become ‘COBA7®s WHY’ since early 2014, continuing to aptly claim…

U support US & WE serve U!

Already, most LLLCommunity owners/operators throughout the U.S. & Canada know there’s only one entity routinely fulfilling these seven key functions in their behalf:

• Ongoing statistical research, e.g. annual ALLEN REPORT. 26th edition, due out January 2015, is by far, the ‘biggest & best’ ever penned and published!

• Updating and distribution of a dozen Signature Series Resource Documents, one per month all year long; plus, addition of several new SSRD-PLUS resources.

• Weekly and monthly online and print communication keyed to manufactured housing & LLLCommunity professionals via blog posting and two newsletters.

• Superb networking opportunities, via annual international networking roundtable and FOCUS Groups as needed or requested by COBA7® MHInsiders.

• Deal-making opportunities via unique relationships and special meeting venues

• Professional property management training and certification via the Manufactured Housing Manager® or MHM® program, via one day seminars & correspondence

• National advocacy ‘as need be’; to date: Official ombudsman (press) & historian for the manufactured housing industry and LLLCommunity asset class.

Yes, those seven functions comprise ‘My WHY’, now ‘COBA7®s WHY’ for serving YOU going forward into year 2015 and beyond, adding to the 35 years already past! So, if not already affiliated with COBA7®, do so today, by phoning the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

***

Two of MHIndustry’s ‘black eye’ Images!

Saturday, December 27th, 2014

COBA7® via community-investor.com Blog # 329 Copyright @ 28 December 2014

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

This blog posting is the primary national advocacy voice, official ombudsman, research reporter, & online communication media for all LLLCommunities in North America!

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance®, a.k.a. COBA7®, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

Introductions to this week’s COBA7® blog posting at community-investor.com website:

I.

With every other investment or commercial realty class, one not trained & certified within that income-producing property type is not a professional property manager! Among land-lease-lifestyle (a.k.a. manufactured home) communities, we routinely entrust multimillion dollar operations to minimally trained & non-certified individuals

II.

Tired of being told what you should believe about manufactured housing and or LLLCommunities and related issues and trends? Then encourage those who publish the few remaining print and online trade tabloids, ezines, newsletters and blogs, to ‘journal up’ and provide more facts and less opinion within their pages. Then we all benefit!

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I.

One of Manufactured Housing’s Correctible ‘Black Eye’ Image Indicators

Lack of Professional Property Management Training/Certification

First the numbers. It’s estimated there are 50,000+/- land-lease-lifestyle communities (a.k.a. manufactured home communities), of all sizes, located throughout the U.S. Among those 50 thousand unique, income-producing properties, one is lucky to find 153 Certified Property Manager® members of the prestigious Institute of Real Estate Management®, shouldering regional, executive, and asset management level positions with one or another of the 500+/- known property portfolio owners/operators in North America – or an income-producing property owner in their own right. That’s just one CPM® for every 327 LLLCommunities, or three per each of the 49 states where this type investment property is located. IREM® has 8,469 CPM® members @ 12/23/2014. *1

The ‘numbers’ are only slightly better for Manufactured Housing Managers® trained and certified by GFA Management, Inc., dba PMN Publishing since designating its’ first MHM® on 5 June 2001. To date, nearly 1,000 MHM®s have been certified! That brings the ‘# of MHM®s per property’ to about one per every 50 LLLCommunities in the U.S. and Canada, still way below our sister property type, conventional apartment communities. There we find the National Apartment Association® training and designating Certified Apartment Manager®s or CAM®s (I was one in 1978). And IREM® has its’ Accredited Residential Manager® or ARM program, also long in place. Few CAM®s & ARM®s, however, are the LLLCommunity business.

And finally, the Manufactured Housing Institute’s, Manufactured Housing Educational Institute, home of the Accredited Community Manager® designation, has certified approximately 200 ACM®s; though hundreds, if not thousands, of LLLCommunity managers have taken one or more of the three requisite levels of training – but failed to qualify for full accreditation. The first ACM® class was held in New Jersey on 30 May 1991, 23 years ago.

So, where does this leave us? Right where we are today, an industry and realty asset class: seriously deficient in an area that, given sufficient training, experience, and recognition, could go a long long way to improving the overall (negative) image of LLLCommunity ownership and management. Right now, for all practical purposes, we do NOT train and certify on-site managers to whom we entrust multi-million dollar income-producing investment properties (e.g.100 rental homesites X $25,000/site value = $2 1/2 million dollars). So, shame on us when well-meaning (untrained) individuals make serious mistakes, cripple their operation, and or mismarket housing product and rental homesites. And where, and from whom, are they to learn about curb appeal, resident relations, and other good business model practices? No wonder we have public image challenges in local housing market after local housing market!

Hence, the ‘big deal’ about professional property management training and certification! Here’re major ways such programs could (should be) helping the manufactured housing industry and its’ investment real estate component, the LLLCommunity:

• Knowledge. Nothing wrong with OJT (‘on the job training’), as far as it goes. But therein lies the shortfall. In many, if not most cases, new on-site property managers replace failed ones, or walk into a position vacancy, with little to no support. Who’s ‘to train’ and assist? A regional VP or PM, or property owner (also likely untrained and certainly not certified) next time they’re in the area, whenever that might be? Only a few of the largest of portfolio firms have crafted in-house training programs (e.g. ‘MHCollege’), some via periodic group training, others via webinars, and some using SOPs (Standard Operating Procedures manuals). So, where does one turn, to truly learn ‘basic PM principles & practices’? IREM®, MHEI, & COBA7®

• Experience. Once professional property management training programs are in place, over time, PM knowledge and on the job experience become valuable and transportable. Yes, that latter part can be a two-edged sword at times; but would you rather have access to – and properly reward, ‘capable, experienced, motivated PMs’, or continue to fish in employment ponds populated by catches of questionable value for your operation? Hopefully the former. At the very least, CPM®, ACM®, & MHM® certification designees demonstrate ‘sticktuitiveness’ as property managers, individuals who’ve taken the time and made the effort, via training and OJT, to learn the LLLCommunity business.

• Attitude & Motivation. It’s the rare PM who is self-motivated enough to craft their own education regimen and truly learn from experiences on-site. However, PMs with professional property management training and certification under their belt, ‘know they’re special’, and generally bring heightened motivation to such positions in LLLCommunities and portfolio oversight.

Taken together, the Success Triangle of Knowledge, Experience & Attitude plays well in the field of professional property management. And it’s much the same scenario, where one finds individuals working in bookkeeping as clerks, with the better, motivated ones, training and becoming certified, via knowledge, experience, and attitude, as Certified Public Accountant®s or CPA®s. Who advises you on corporate tax matters and personal wealth preservation? A clerk or CPA®; a self-proclaimed money manager or Certified Financial Planner®, a.k.a. CFP®? Get the point?

With that said, where and how are YOU going to have your property managers trained and certified, maybe including yourself? Depends on what level and degree of PM training is needed or desired. Also whether one’s property or property holdings are extensive enough to afford the training costs involved leading to PM certification. Note. This latter point is why the MHM® program is limited to one day and only costs $250.00 per MHM®candidate.

In my opinion, the CPM® program offered by IREM®, as expensive and time consuming as it is, is the ‘graduate school’ level of professional property management. MHEI’s three course program for ACM®s, as difficult as it is to find the tri-levels of PM classes required for certification, is the manufactured housing industry’s ‘college course’ level program for professional PMs. And the one day MHM® training and certification program, for entry level managers and property owners, is now administered by the Community Owners (7 Part) Business Alliance®, or COBA7®, a division of GFA Management, Inc.

For that matter, the one day MHM® program is already scheduled for 20 January 2015 in Louisville, KY., and 20 June in E. Peoria, IL. In addition to the one day classroom offerings for portfolio owners/operators and state MHAssociations (along with a profit sharing arrangement), the MHM® program is also available as a correspondence course for individuals. In all instances, the tuition fee is only $250.00 per MHM® candidate. No testing. And for the fee, MHM®s receive a copy of the classic text Landlease Community Management, a monograph of contemporary MHIndustry ‘readings’, and gold MHM® pin and MHM® certificate. A class photo is taken and published in the Allen Letter professional journal. For more information, and to register for MHM® classes, simply phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. The MHM® class is the only PM certification program, among all three, to be taught by a veteran LLLCommunity owner/operator and CPM®Emeritus.

For more information (Ask for brochure), or to register for the MHM® class, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. And if coming to Louisville, KY, for the 20 January class, plan to stay over for the annual MHShow on 21-23 January.

End Note.

1. According to a recent study of its members by IREM®, “…the average CPM®…is 51 years old, with men comprising half of CPM® members, but with women comprising 62 percent of CPM® candidate members. In addition to IREM® coursework, 69 percent of CPM® members & 61 percent of CPM® candidates hold at least an undergraduate degree. CPM® members…typically hold executive or property manager/supervisor roles and supervise a staff of 44 employees. CPM® members…earn a median total compensation of $108,200., which includes a base salary for property management and additional real estate income from sales and leasing commissions.” Quoted from Journal of Property Management, July/August 2014, p.64.

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II.

Another Manufactured Housing
Correctible ‘Black eye’ Image Indicator

The Dearth (‘scarce supply’) of Trade Journalists in Print Today!

On the other hand, we have an abundance of quasi pundits (‘learned persons’), op/ed writers (‘opinion/editorial’), even would be muckrakers (Look it up…) published in print and online. What we lack are trained and disciplined trade journalists.*1 In this veteran industry observer’s opinion, the last professional writer to grace the manufactured housing scene with journalistic skill was Bruce Savage – in spite of his (past) apologist role as VP of communication & public affairs, at the Manufactured Housing Institute.*2

This dire shortage of writing talent and seasoned editorial presence on the national manufactured housing scene was driven home recently, when this blog column ‘broke stories’ describing HUD’s renewed interest in enforcing nearly decade old federal installation standards nationwide -and how the Frost Free Foundation might prove to be the industry’s ‘silver bullet’. Plus there was a story about HUD-Code home manufacturers ‘not yet’ reducing home shipment freight charges even though gasoline prices are now below $2.00/gallon (Yes, I know, diesel fuel prices are different).

Anyway, as hard as this blogger tried, both pieces read as op/ed pieces, rather than pure journalistic expose’ or rote. And though blog floggers (readers) responded with “Good follow-up on the FFF”, & “Nice ombudsman action on fuel charges, George.”, the matter got me to thinking, ‘Why are most manufactured housing-related news stories the way they are (slanted or spun), in today’s print and online press?’

For starters, few of our news stories ‘have juice’. This is the inherent, sometimes ill-defined quality of stories to command, or fail to excite, reader interest. It’s why the bromide ‘Bad news and sex sells newspapers!’ exists. So, given scarcity of titillation and excitement, MH ‘reporters’ oft defer to interpreting what hard news is ‘really about’ and what consequences, intended and otherwise, might be ahead. Plus, they’re rarely paid for their input, so it’s ‘too easy’ for personal agendas to taint ones’ stories.

Frankly, throughout the manufactured housing industry we have far too few trained practicing scribes. Think about it. There’re a half dozen individuals today who enjoy national reputations, all cultivated as writers-speakers-product/service vendors. Meaning, you know and ‘read’ them in their proprietary print or online publications, have heard them ‘hold forth’ at one or another national manufactured housing event, and likely buy or subscribe to their products or services. Then you have the nearly dozen individuals who, as one trade media publisher describes them, ‘Simply fill white space between ads’, and have been in place for so long, few read what they pen anymore. Or as media mogul Robert Murdoch famously puts it, “…base (your) decisions on information…from responsible reporting, not the gobbledygook of self-important pundits.” *3

So, manufactured housing news reporting is pretty much a journalistic wasteland. What can be done to change this environment, assuming it’s portrayed accurately, into an enlightened one, where we expect, receive, and enjoy solid news reporting from and about all segments of the manufactured housing industry?

For starters, ‘Get educated’! How many of our industry’s present day ‘writers’ are trained journalists? None, as far as I know, including myself. How to correct this shortfall? Check with local community colleges, various online courses, even local writing groups, to learn or relearn the basics of news reporting and editorial skills. For starters, visit poynter.org/training/online, & spj.org Something else that’d help, is for publishers to start paying writers for submitted material, then hold them to a higher standard than what’s possible when they’re writing for complementary ad space or less. Also get involved in one or more local writers’ groups and submit manuscripts for peer review.

The challenge for us engaged in news reporting and influencing (i.e. op/ed), we must work harder to separate our chaff from our wheat. For example; in my case, work harder to ensure the Allen Letter professional journal ‘reports MHIndustry & LLLCommunity business news’ faithfully, accurately, with minimum comment; same with the Allen CONFIDENTIAL! business newsletter – except there, ‘the news’ oft hasn’t happened yet…Then, attempt to reserve most op/ed commentary for this weekly blog posting at community-investor.com. Will I be successful doing so? Guess time will tell. In the meantime, let me know how we’re doing…And now, what will YOU do at your end, as a writer, a reader, editor and or publisher?

End Notes.

1. journalism: “…activity or job of collecting, writing, and editing news stories for newspapers, magazines, television and radio” – and now online.

2. Read Bruce Savage’s The First 20 Years!, ‘An historical retrospective, tracing the birth and growth of national advocacy in behalf of LLLCommunities’, PMN Publishing, Indianapolis, IN. 2013.

3. Acton Institute’s Religion & Liberty NEWSLETTER, Winter 2014, Vol. 24, # 1., p. 11

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26th ALLEN REPORT & ‘New Breed of MHRetailer & Lender’

Thursday, December 18th, 2014

COBA7® via community-investor.com Blog # 328 Copyright @ 21 December 2014

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

This blog posting is the primary national advocacy voice, official ombudsman, research reporter, & online communication media for all LLLCommunities in North America!

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance, a.k.a. COBA7®, use Official MHIndustry HOTINE: (877) MFD-HSNG or 633-5764.

Introduction to this week’s COBA7® blog posting at community-investor.com website:

I.

Coming Soon: 26th annual ALLEN REPORT

‘Biggest & Best Ever, Thanks to You!’

How so? Five good reasons. 1) Benchmark statistics have been culled from the strongest questionnaire response in the 26 year history of the ALLEN REPORT; 2) included is a comprehensive chronicle of the 2014 ‘Dawn of NEW ERA for land-lease-lifestyle (a.k.a. manufactured home) communities!’; 3) an inaugural feature of rental unit and contract sale home inventories on-site; 4) exciting, new national LLLCommunity inventories by state; and, 5) first ever, Standard Metropolitan Statistical Area (‘SMSA’) local housing market homesite rent summaries from Datacomp & MHVillage!

This year’s ALLEN REPORT, a.k.a. ‘Who’s Who Among LLLCommunity Portfolio Owners/operators Throughout North America!’ is also lengthier than previous editions, so will be restricted to a limited print run of 250 copies. Already, 200 of which are committed to Community Owners (7 Part) Business Alliance®, or COBA7® affiliates, a.k.a. ‘MHInsiders’, and individuals/firms who submitted ‘completely filled-in questionnaires’ pursuant to preparation of the ALLEN REPORT.

So, if you want a copy of this history-making 26th annual ALLEN REPORT, affiliate with COBA7® at the Option II level ($544.95), to receive 12 monthly issues of the Allen Letter professional journal and a dozen Signature Series Resource Documents or SSRDs – the first of which, distributed during January 2015, is the ALLEN REPORT. The remaining 11 SSRDs? Directories of lenders, HUD-Code home manufacturers, real estate brokers, freelance consultants, MHIndustry print & online media, and all national advocacy organizations; as well as the industry’s Official terminology Lexicon or Glossary.

To affiliate with COBA7®, simply telephone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. There is no better value from anyone else, for LLLCommunity owners/operators, anywhere in the manufactured housing industry!

II.

‘New Breed of MHRetailer & Lender’

The business model trend is indeed here, but no one is measuring or tracking its’ growth!

According to the 26th annual ALLEN REPORT, the majority of land-lease-lifestyle (a.k.a. manufactured home) community portfolio owners/operators now routinely purchase new Community Series Homes, or CSH Models – and other models of HUD-Code manufactured homes, from factories; for installation, sale, and (oft times) seller-financing within their properties. Doing so, ensures stable, growing physical and economic occupancy cum profitability. Hence the business model trend moniker of ‘New Breed of MHRetailer & Lender’.

This has been an evolving trend, not an overnight phenomena with a specific ‘start date’. The evolution began when easy access to chattel capital from independent third party lenders nearly ended, soon after the turn of the century, and as independent (street) MHRetailers disappeared from many local housing markets – due to economic pressures, or acquisition and conversion into ‘company stores’. Savvy LLLCommunity owners/operators of institutional investment grade properties (i.e. 200+ rental homesites in size*1) realized they had to become controllers of their business destinies, no longer reliant on local MHRetailers to fill vacant rental homesites in their properties – as had been the practice for 50 years.

The turning point, among LLLCommunity owners/operators, occurred on two specific occasions precisely one year apart.

On 27 February 2008, a hundred or so LLLCommunity owners/operators convened at the FountainView LLLCommunity in Tampa, FL., to chart their destiny, relative to the manufactured housing industry. Result? Five strategies and action areas, along with the mantra: ‘Affordable Housing & Lifestyle’ – engraved on challenge coins given every attendee as a motivating reminder. This event was the first National State of the Asset Class (‘NSAC’) caucus.

A year later, on 27 February 2009, another hundred – this time a mix of LLLCommunity owners/operators and HUD-Code home manufacturers, convened at the new RV/MH Hall of Fame facility in Elkhart, IN., to agree on what it’d take for the former to buy more homes directly from the latter! Answer? The Community Series Home, or CSH Model.*2 The new housing design was not identified by name, until six months later, at the annual Networking Roundtable, where several CSH Models were on display. And this NSAC caucus is generally acknowledged as being the ‘line in the sand’ moment for LLLCommunity owners/operators, to (eventually) displace independent (street) MHRetailers, in many parts of the U.S., as primary wholesale buyers of manufactured housing.

It’s now six years later, and among property portfolio ‘players’, on-site home sales and (oft times) seller-financing – under the watchful eye of state and federal financial regulators, has become commonplace. So commonplace, that in several instances, large portfolio owners/operators have more than 10,000 rental units in place throughout their properties. By and large, however, the average number of rental homes and contract sale units on-site, among portfolio folk, hovers in the neighborhood of 375 apiece, relative to overall portfolio presence.*3

But that’s not the whole story. It’s estimated maybe, at most, 15 percent of LLLCommunities are actively selling and self-financing new homes on-site; while the remaining 85 percent (i.e. mostly Mom & Pop-sized investment properties) are not so engaged, for a variety of reasons (e.g. passive investors, lack of knowledge, inexperience, and lack of capital). The question becomes: Should and can this ‘vast majority of property owners be educated and motivated to buy into this trend, stimulating much-needed increase in shipment volume throughout the MHIndustry?

Besides ‘that question’, much else is not well! Here’s a cacophony of disparate shortfalls within and throughout the manufactured housing industry and LLLCommunity realty asset class, going into year 2015:

• No one is ‘keeping score’, that we know of, relative to the actual shipment volume of new HUD-Code homes going directly into LLLCommunities throughout the U.S. Why is this important? If we, as an industry, knew the percentage of new home shipments (e.g. ‘What percent of 60,228 in 2013?’) going into LLLCommunities, it’d be instructive as to activating the ‘quiet 85 percent’ of LLLCommunity owners/operators. Anyone ‘out there’ have any practical solution(s) to this lack of knowledge? MHI. How ‘bout you?

• Home manufacturers, as busy as some of them are today –given the reduced number of factories working thru backlogs of home orders, appear to be cutting their nose off in spite of their face, where product pricing, including freight (gas) costs are concerned. One, at times, even senses being ‘taken advantage of’, as the ‘New Breed of MHRetailer & Lender’, still naïve as to’ industry past practices’ with erstwhile independent (street) MHRetailers. Here’s an area where the MHARR might be of assistance.

• Home finance principles and regulations, as well as the securing of fresh chattel capital remain new, often confusing educational challenges for LLLCommunity owners/operators of all sizes – except for perhaps the largest of the property portfolio firms. Fortunately, we have resources like Rishel Consulting, teaching ‘How to Raise Capital and be a Compliant Lender’, as well as Spencer Roane, MHM®, holding forth on the attributes of lease-option.

• And there’s this very real but rarely talked about caution, relative to veteran LLLCommunity owners/operators, who’ve structured all sorts of deals, over the years and decades, to facilitate home ownership/site leasing by individuals and families least likely to qualify for home financing in their local housing markets. These veterans continue to ‘go it on their own’, not so much out of greed – though that can be a problem, but the genuine concern, that if they don’t ‘fit deals to their customers’, they’ll wind up contributing to the homeless population of their local housing market. Think about it. Our $ regulators should, but evidently don’t.

• Of late, there’s also increasing concern expressed that, 1) given 80+/- percent national market share is enjoyed by the Big Three-C HUD-Code home manufacturers; 2) the recent surprise departure of U.S. Bank – and maybe more, from the chattel capital lending scene; and, 3) dominance of national advocacy affairs in one entity, by a few salaried executives from as few companies and property portfolios, that overall sensitivity to business and market needs of grassroots businessmen and women, from all segments of the MHIndustry, is going begging! Proof? Repeated calls for a National Strategic Planning meeting are ignored by two of three national manufactured housing trade bodies, the two dominated by HUD-Code home manufacturers.

The messages conveyed and suggested by these five bullet points? This/these questions:

Where do we go from here, relative to this business model trend change, from independent (street) MHRetailers being primary customers of HUD-Code home manufacturers, to the New Breed of MHRetailer and Lender emerging? The trend needs documentation; home manufacturers need to treat their new business partners with more respect; home finance and chattel capital sourcing remain more a mystery than applied methodology; and, national advocacy bodies need to realize ‘life is more than just lobbying in the nation’s capitol’ – they must also be about communication and service!

So, where do we go from here? Nathan Smith and Mark Weiss, esquire; are you listening, reading, and understanding what’s going on – and at times, not going on, throughout the manufactured housing industry and land-lease-lifestyle community asset class?

(MHARR. You can no longer cop out by saying LLLCommunities are not your members. They’re not; they’re now – or should be, your home buying customers, worthy of your attention!)

The Louisville MHShow (KY) occurs a month from now? What’s stopping you two from laying the groundwork for a much-needed National Strategic Planning Meeting for manufactured housing and land-lease-lifestyle community-affiliated businessmen and women from throughout the U.S., willing to pay their own way to a two day venue where the preceding – and other issues, are brought into the open and discussed publicly for the first time – with an eye to resolution, planning, and recovery?

End Notes:

1. See page # 68 (Official MHIndustry Lexicon & Glossary) in Bruce Savage’s The First 20 Years! Published by PMN Publishing, Indianapolis, IN., 2013.

2. Community Series Home, or CSH Model is characterized as having at least one WOW! design factor to get the homebuyer’s attention; and an array of durability enhancing features that facilitate changes in lessees and owners, with a minimum of home repair by the LLLCommunity owner/operator

3. 26th annual ALLEN REPORT, a.k.a. ‘Who’s Who among LLLCommunity Portfolio Owners/operators Throughout North America!’, available for $544.95 from PMN Publishing, Indianapolis, IN. (317) 346-7156

Use ‘FFF’ = Save $, & COBA7 Ombudsman (press)

Saturday, December 13th, 2014

COBA7® via community-investor.com Blog # 327 Copyright @ 14 December 2014

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

This blog posting is the primary national advocacy voice, official ombudsman, research reporter, & online communication media for all LLLCommunities in North America!

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance®, a.k.a. COBA7®,use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

Introduction to this week’s COBA7® blog posting at community-investor.com website:

I.

Lightening is striking twice, where the manufactured housing industry is concerned; first, $ overregulation by the CFPB, now renewed focus on Frost Free Foundations by HUD! Brings new impetus to yon truism, ‘You can run but you cannot hide – for long!’

II.

Are high new home shipment freight costs discouraging you from ordering the new HUD-Code home, or homes, you planned to install on-site and sell on speculation? Well, let’s hope the MH manufacturers read this week’s blog and pass on gas savings to you!

I

A ‘Frost Free Foundation’ in Your Future?

What We’ve Learned Since Last Week’s Blog Posting # 326. Read it first!

Before we bring you up to date on this subject, here’s one of several responses, to blog posting # 326, received from blog floggers (readers) since last Sunday’s posting:

“Good post today George! Excellent recommendations on FFF. ‘Installation’ is one of those areas where ‘mayhem’ can unfortunately, bite us in the butt years after a MH is sold, reinforcing feelings about our industry being ‘cheap, disposable, or short-term’. We had a similar problem with excessive pier settling because of poor soil load bearing – until we tested the soil and increased the number of piers. Thanks for all you do!” SP

So, we are dealing with a real business world matter here. Hopefully you now realize why personal and corporate knowledge of the Frost Free Foundation® or FFF design is important to your livelihood. Now here’s what we’ve learned since last week’s posting….

Permission to reprint Frost Free Foundation® for manufactured homes was denied!

But FFF is already on the internet. Google Frost Free Foundation® and scroll thru FFF descriptions to two labeled as PDFs. There you’ll find the 11 page design document.

And here’s how the Systems Building Research Alliance (SBRA), in its’ literature, describes how to get permission to use FFF for new home installation, i.e. “Any company or individual wishing to use the FFF design should contact the manufacturer of the home for information obtaining the rights to use the design.” Which HUD-Code home firms are listed? Clayton Homes, Champion Home Builders, Inc., Hi-Tech Housing, Homebuilders Northwest, Liberty Homes, Inc., Palm Harbor Homes, and Pine grove Homes, Inc. If you need assistance getting in touch with any of these firms, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and ask for help. COBA7® affiliates; simply refer to the Signature Series Resource Document (SSRD) titled: ‘Major Factory-built Housing Manufacturers, to include HUD-Code Homes, Modulars, & ‘RV Park Models’.

How ‘bout ‘community owners/operators’? Contact the manufacturers listed above – or if buying from a manufacturer not listed, have them contact SBRA directly to get access to FFF. Even community owners/operators “…can license the FFF design for use with existing homes” by requesting the ‘Frost Free Foundation® Design: Application for Community Owners, Existing Homes’. Complete it and submit to SBRA. Individuals too can access FFF via SBRA. In all instances, simply phone (212) 496-0900X10

When the Manufactured Housing Consensus Committee (‘MHCC’) met last week they were briefed on HUD’s efforts to develop an installation regimen for approximately 16 states currently without programs. HUD expects to launch a pilot installation program in two states by March 2015, anticipating full implementation sometime in 2017. That schedule is what’s ‘turned the heat up’ on accessibility to the Frost Free Foundation® design protocol among land-lease-lifestyle community owners/operators in the U.S..

COBA7® reminds everyone planning to use the Frost Free Foundation® design, within or outside land-lease-lifestyle communities, to seriously consider incorporating the six bullet points articulated by a Midwest state MHAssociation executive, into their FFF plan. Simply scroll back to blog posting # 326 at the community-investor.com website.

As there are further developments on this important and timely topic, we’ll let you know here, in the Allen Letter professional journal, and the Allen CONFIDENTIAL! business newsletter. All three MHIndustry & LLLCommunity communication and trade media resources are brought to you by the Community Owners (7 Part) Business Alliance® or COBA7®. If you’re not already an affiliate, a.k.a. ‘MHInsider’, simply phone the aforementioned Official MHIndustry HOTLINE to do so. 200 of your peers affiliated during 2014; expecting 400 ‘MHInsiders’ to be on board by end of year 2015.

II.

Ombudsman (press) Gets Mail from You

Recent correspondence from a land-lease-lifestyle community owner/operator observed:

“Hey George, what’s with the HUD-Code home manufacturers? Every time the price of crude oil goes UP, so do their freight charges! Yet now, as the price of crude oil plummets DOWN, where are the decreases in freight charges – and how soon will we see them? When asked, the home manufacturers from whom we buy new homes, avoid the issue at every turn. Maybe a little open publicity will prod them into cutting this onerous cost addition to their product.” FR

Recent cursory research online shows June 2014 gasoline prices, at the pump, to have been $3.68/gallon, when crude oil was at $106.53/bbl. And earlier this month (12/3), gas prices dropped to $2.73/gallon, as crude oil priced down to $67.25/bbl. And here we are at December mid-month, and gasoline prices at the pump continue to decline further.

Executives at the Big 3-C, HUD-Code home manufacturers (Controlling 80+/-% national MH market share) receive this weekly blog posting, via BEBA (Blast Email Blog Alert), as do many smaller, regional home manufacturers. How ‘bout if we give them grace to the end of December to make freight price adjustments. After all, lowering this onerous expense only helps promote additional new home sales and shipments ‘in the dead of Winter’. Remind me to revisit the matter during early January 2015.

Ombudsman (press)? Some reading this likely wondered what that was all about, as you read the title to Part II of this week’s blog posting. Several months ago, a few COBA7® ‘MHInsiders’ suggested we activate the seventh part of the alliance’s business model – that being ‘national advocacy when need be’, by publicly offering to do what we’ve long done privately, i.e. receive your concerns and complaints regarding various aspects of manufactured housing and LLLCommunities, then ‘put the right parties together’ to resolve matters, seek solutions, and move us ahead together. Well, we’ve been doing that, and this matter of ‘too high new home shipment freight prices’ is simply the latest issue addressed, and the first in a public (press) fashion. So, do you have a matter appropriate to ombudsman attention? Simply phone the aforementioned Official MHIndustry HOTLINE. After all, ‘ombudsman (press)’ services underscore the COBA7® motto of ‘U Support Us & We Serve U!’

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FFF: Embrace it or Dig Deep Into $ Pocket!

Friday, December 5th, 2014

COBA7® via community-investor.com Blog # 326 Copyright @ 7 December 2014

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

This blog posting ‘is the primary national advocacy voice, official ombudsman, research reporter, & online communication media for all LLLCommunities in North America!

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance®, a.k.a. COBA7®, use Official MHIndustry HOTLINE: (8777) MFD-HSNG or 633-4764.

Introduction to this week’s COBA7® blog posting at community-investor.com website:

I.

‘Frost Free Foundation’, a.k.a. ‘FFF’; the ‘Silver Bullet’ for Home Installations in LLLCommunities?’ YES! This is the ‘sleeping giant’ of the past decade, now awakening!

II.

‘Good-bye Danny Ghorbani! Or, ‘See You Later as Arbitrator?’ Manufactured housing industry losing it’s ‘watchdog’ of the past three decades! Who steps into his shoes???

III.

If you’re not yet an ‘MHInsider’, takes steps now to become one during the Year 2015!

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I.

‘Frost Free Foundation’, a.k.a. ‘FFF’ the ‘Silver Bullet’ for Home Installations in Communities?

YES…

If You Remember George Porter, SBRA, & Model MH Installation Standards: Final Rule 24 CFR 3285!

During the decade between dawning of the 21st Century and year 2010, as the manufactured housing industry was staggering from having lost easy access to chattel capital and plummeting home shipment volume, it faced the eventual reality of increased regulatory oversight from HUD, where the Model MH Installation Standard was concerned. Well, it appears that feared time has arrived (2015), and land-lease-lifestyle communities (a.k.a. manufactured home communities) nationwide are ill prepared for it.

The Challenge? When the Model Manufactured Home Installation Standards: Final Rule, 24 CFR 3285 was implemented by the U.S. Department of Housing & Urban Development, October 2007, it was pretty much assured that unless one’s existing concrete foundations (i.e. piers & concrete ribbons) extended below the frost line, they’d have to be replaced, upon home turnover, at a minimum cost of around $5,000.00 per foundation – even if the preexisting foundation system(s) had never failed!

The Opportunity? Paraphrasing a 1960s hit song about coal miner, ‘Big John’:

‘Along came George Porter & the Systems Building Research Alliance (or SBRA)!’

The adventure began with George experiencing an epiphany-like personal insight, where manufactured housing installations were concerned. While he’d been a practicing installation specialist ‘for decades’, it all came together for him one day, with this simple, eureka-like realization…

“…frost heave can only occur in the presence of three interrelated factors: 1) subfreezing temperatures, 2) frost susceptible soil and 3) sufficient moisture in the soil (about 80% saturation or greater). Elimination of any of these factors will prevent frost heave from occurring.”

The above quote is from the summary of ‘A Frost Free Foundation® (FFF); an Alternative Shallow Frost Protected Foundation Design for Manufactured Homes, by Paul W. Hayman, MS, PE or Hayman Engineering, Inc., prepared by Systems Building Research Alliance, July 2010

But how did the manufactured housing industry research and codify George’s epiphany into that summary statement? Via interrelated cooperation between Porter and SBRA’s Technical Advisory Committee, with Hayman Engineering; plus financial support from ten suppliers/businesses and the encouragement of 36 manufactured housing association executives!

The SBRA (formerly the Manufactured Housing Research Alliance), FYI “…is a non-profit organization with the mission of developing new technologies to enhance the value, quality, and performance of the nation’s factory-built structures.” As such, it served as the linchpin for this project. It provided the venue for establishment of scientific proof, and solicitation of engineering support, for the ‘frost free foundation’ or ‘FFF’ concept, and its’ applicability to HUD-Code manufactured homes!”

So, what’s ‘FFF’ all about? Instructing raw land developers and owners/operators of land-lease-lifestyle communities (a.k.a. manufactured home communities) how to properly implement and maintain frost free foundations in lieu of expensive monolithic concrete foundations. Read that sentence again. It’s the gist of what’s to follow here!

Permission has been sought to reproduce the 11 page ‘FFF’ report, cited in this blog posting, as a booklet to be made available to anyone in the HUD-Code manufactured housing industry and LLLCommunity asset class who requests it. Cost? To be determined, but minimal, with any profits generated going to the RV/MH Heritage Foundation’s Hall of Fame facility in Elkhart, IN, or possibly the SBRA. More information on that when available, along with ordering instructions.

In the meantime, for more information, simply phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 to reach the Community Owners (7 part) Business Alliance® or COBA7®.

But Whoa! There’s More to The FFF Story! Some of it Good, Some of it Hardly so….

First the Good.

Want to make the Frost Free Foundation, or ‘FFF’, appropriate to your particular LLLCommunity(ies) application? Heed this sage advice from one Midwest manufactured housing state association to their members:

• Obtain a copy of ‘A Frost Free Foundation® (FFF): An Alternative Shallow Frost Protected Foundation Design for Manufactured Homes, prepared by Paul W. Hayman, MS, PE, Hayman Engineering, Inc. (This should be part of every Installation Manual, but isn’t. And why we’re attempting to reprint the document)

• Require a soil test by a licensed soil tester

• Require the ‘FFF’ design be used only with certain soil types, unless native soil is replaced

• Require the frost line be above the water table

• Require drain tile and or roof gutter installation to facilitate movement of water away from the ‘FFF’

• Have an ‘FFF’ plan (See first bullet point) sealed by a registered engineer; and if applicable (given a statewide building code), pay the state – where ‘FFF’ is to be utilized, to have design ‘state approved’. Doing so, in the latter instance, forces local building inspectors to accept the design – since, at this point, ‘FFF’ is not mentioned in most Installation Manuals. Furthermore, and this is an important point, if a local inspector attempts to decline accepting an ‘FFF’ design because it’s not in new home Installation Manual, remember: the HUD-Code is what it says, and if home manufacturer overlooks a viable alternative (i.e. ‘FFF’ plan sealed by a registered engineer), that’s an issue under warranty law for the licensed installer and home manufacturer to work out. It isn’t a code issue.

.

Now, for the Not so Good

To date, as a land-lease-lifestyle community owner/operator, I’ve reviewed official Home Installation Manuals prepared and distributed by several HUD-Code home manufacturers, to see if the aforementioned Frost Free Foundation system is included therein (It isn’t), or even mentioned, e.g. Is ‘FFF’ in the index to the manual? (It isn’t). Thus, the emergence of this disturbing reality:

While it’s easy to be impressed with the detailed and complicated descriptions, in these Installation Manuals, as to effecting the proper installation of a HUD-Code home. From the home manufacturers’ perspective, this is their ‘bread & butter’, their means of ensuring – as far as it goes – the safe, secure, and stable installation of their product. But the question that comes to mind is, ‘Why the absence of (any) mention of ‘FFF’ in Installation Manuals?’

Frankly, most – to – all HUD-Code home manufacturers (i.e. certainly MHI direct, dues-paying members) are well aware of the ‘FFF’ researched and codified, engineering wise, by the Systems Building Research Alliance in 2010, given SBRA’s close working relationship with MHI.

Perhaps it is a matter of perspective, as suggested in a previous paragraph. The home manufacturer’s primary installation concern is to explain how to do it ‘right and well’, per the design and performance requirements of their HUD-Code housing product. And expensive installation costs be damned, as those high dollar costs are not the manufacturer’s responsibility. Remember however, these are the folk about whom the image-compromising apercu, ‘D&R Deliveries’ (i.e. ‘Drop & Run!) was coined in the early days of the industry. So maybe not much has changed, yet…..

However, the matter is much different from the LLLCommunity owner/operator perspective. Here, expensive installation costs do matter, they matter a lot! For example, given a properly drained rental homesite featuring concrete ribbon foundations in place, under the same fully and well-skirted home, for 30 years, with no failures whatsoever. When that home is removed from said foundation system, federal installation standards require those 30 year old ribbons be replaced with a monolithic slab (not concrete ribbons) or conventional below the frost line piers, to the tune of approximately $5,000.00. per rental homesite! On the other hand, given a properly drained rental homesite, with appropriately porous soil, and perimeter skirting around the home – all requirements of the engineered and registered Frost Free Foundation, then any home can be installed on the rental homesite using specially-designed pads or piers, even the original concrete ribbons, at little to no extra cost to the property and or home owner.

And there’s yet a further $ matter here. Who pays for the cost of the new foundation system? Well, in some locales it’s a matter of state law. How so? In states that have adopted AARP’s landlord tenant law model language, whereby the LLLCommunity owner/operator cannot make the tenant (homeowner/site lessee) pay for ‘permanent improvements’, two key questions come into play, being: 1) Is the new foundation a permanent improvement? 2) Does it serve the community or the home? Answer might be a matter of choice. If homeowner/site lessee has a choice between the two cost extremes described, he/she pays for said choice. If the property, however, ‘requires’ one or another of the options, it pays for the improvement. All the more reason to take the steps outlined earlier, to ensure one is enabled to use the ‘FFF’ alternative on-site in one’s LLLCommunity(ies).

Bottom line? Follow the money! Again, matters of perspective….

The home manufacturer fabricates and delivers a new home – with an official Installation Manual, to the rental homesite, often within a LLLCommunity, and ‘end of story’ unless there’re service issues later. On the other hand, pity the LLLCommunity owner/operator who has 100 well-functioning rental homesites, using concrete ribbons or shallow piers, for the past 30 years; and now faces the prospect of being forced, maybe beginning during year 2015, of having to retrofit every one of them, to the tune of $500,000.00. (That’s $5,000/site X 100 sites)!

For the HUD-Code home manufacturer, ‘FFF’ offers little to no value – added to their (housing) product, when the official Installation Manual is supplied with the home upon delivery. However, for the LLLCommunity owner/operator, ‘FFF’ is worth at least $5,000 per site savings, on rental homesites not presently in compliance with the nearly decade old federal home installation standards, soon to be enforced during 2015.

All this, in my opinion, is a major disconnect between two major segments of the HUD-Code manufactured housing industry. Anyone care to bet how the two national advocacy bodies, both of which are home manufacturer-dominated, will arbitrate this important and potentially costly issue – if they even allow it to see the light of day, except for social media communiqués like this blog posting? Specifically, this is a timely and serious challenge for MHI’s national communities council division to soon publicly discuss and resolve with the institute’s manufactured housing division.

In the meantime, what can you, as a LLLCommunity owner/operator do? Encourage your source of new HUD-Code homes to put ‘Frost Free Foundation’ into their Installation Manual as an approved alternative. And, if you’re a direct, dues-paying member of either or both national manufactured housing advocacy bodies, contact them ASAP, requesting they intercede, in your behalf, with their HUD-Cod manufacturer members to do the same, and put ‘FFF’ into their Installation Manual as an approved alternative.

And watch here for instructions on how to obtain your copy of ‘A Frost Free foundation® (FFF): an Alternative Shallow Frost Protected Foundation Design for Manufactured Homes’, by Paul W. Hayman, MS, PE., of Hayman Engineering, Inc. Prepared for the Systems Building Research Alliance, New York, NY., 1 July 2010.

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Good-bye Danny Ghorbani!
Or
‘See You Later as Arbitrator’?

As One Era Ends, is Another About to Begin?

Frankly, I can’t imagine the manufactured housing industry without Danny Ghorbani ‘front and center’ every day in every way, as he has been for the past 28+ years – but now (soon) waiting ‘in the wings’ ready to advise and arbitrate when asked!

But first, a brief look back at his career, one spanning more than four decades; 46 years to be precise. Not many in the business today (are old enough) to say they ‘cut their manufactured housing teeth’ reading and hearing Danny Ghorbani ‘holding forth’, as an engineer on MHI’s staff, then as founder – and now long time executive VP, of the Manufactured Housing Association for Regulatory Reform, or MHARR. I can, so take the liberty of sharing what follows here…

As an industry, we are about to lose our watchdog! Of all the labels that could be, and some have been, applied to Danny ‘over the years’, e.g. maven, guru, lobbyist par excellence – and more; ‘Watchdog’ covers the territory best! Why? Because Washington, DC., and its’ surrounds, oft referred to as ‘Inside the Beltway’ works and functions pretty much to and for itself – just think of the politicking we read, see, and hear about all the time. Well, Danny G., for nearly four decades has been our ‘first source of credible information’ about what was soon going to happen to us as an industry, where regulators, bureaucrats and politicians were concerned.

While many ‘inside the beltway’ prefer the attitude and MO of ‘Going along to get along’ (a.k.a. consensus building) when dealing with politicians and regulators, Danny G, frequently went ‘pretty much alone’ as he confronted Congressmen, Senators, and bureaucrats – of both the appointed and career types, ‘head on’ over issues, proposed legislation, laws, regulations, and more, that would impact or already impacted manufactured housing. Of late, he’s even found time to learn more about the ‘post production’ segments of the MHIndustry, particularly chattel finance and land-lease-lifestyle communities, in his search and effort to restore easily accessible chattel capital to our business environs, and garner cooperation from resident-focused national bodies.

I sincerely hope his peers at the Manufactured Housing Association for Regulatory Reform host a retirement party in the near future, and invite the entire manufactured housing industry to fete this deserving leader and spokesperson one more time! If and when I hear about such a gathering, I’ll let you know about it here, and in the Allen Letter professional journal. Hmm. Wonder who’s going to fill Danny’s monthly ‘white paper space’ in The Journal? Bet you hadn’t thought about that…One more way he’s nigh irreplaceable in the manufactured housing industry. And make sure YOU say ‘Good – bye!’ to him in your own way!

What’s this about a NEW ERA beginning? Well, we already know a NEW ERA began for land-lease-lifestyle community owners/operators began 1 January 2014, with the launch of the Community Owners (7 Part) Business Alliance® or COBA7®. Read more about that in Part III of this blog posting (to follow) and the 26th annual ALLEN REPORT, a.k.a. ‘Who’s Who Among LLLCommunity Portfolio Owners/operators Throughout North America!’, soon to be distributed (January 2015) to COBA7 affiliates, a.k.a. ‘MHInsiders’ and owners/operators who completed AR questionnaires in their entirety. For more info on any of this, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

So, is there yet another NEW ERA on the heels of COBA7®? Some think so. The nature of this NEW ERA? Take your pick of worthy foci: major changes needed to MH business model, to attract financing and homebuyers; restructure national advocacy presence, to better fulfill needs of post-production segments of the industry/asset class; debate and decide whether we’re better off, going forward, as ‘consumer product’ or ‘affordable housing’, but not both; and more….

III

Not Yet a ‘MHInsider?’ Well, here’s how to make that happen before 2015!

If you’re reading this blog posting and haven’t yet formally affiliated with the Community Owners (7 Part) Business Alliance, commit to do so as we segue into year 2015. Why? More good reasons that I have space to tell you here, but for starters:

• More than 200 of your MHIndustry & LLLCommunity peers, including HUD-Code home manufacturers, LLLCommunity owners/operators, lenders, and vendors have already done so. Goal is to have 400 affiliates by year end 2015!

• And you’re not just affiliating with the newest and most vibrant national business alliance, but once you start reading the monthly Allen Letter professional journal, and if so opted, the Allen CONFIDENTIAL!, you in effect become a special class of businessman and woman, a true ‘MHInsider’! How so? You’re now privy to information, news, and statistics not available from any other source anywhere!

• All of a sudden, regional and national MH venues become more valuable to you, as you meet privately, and learn with COBA7® ‘MHInsiders’. For example; on 20 January 2015, in Louisville, KY., I’ll be teaching the one day Manufactured Housing Manager®, or MHM® professional property manager training and certification class. If you’re not yet ‘certified’, this is your unique and timely opportunity. And other special opportunities are being planned for this year.

• Frankly, there is/are no other sources for the directories and hard copy tools provided monthly by COBA7. For example: the ALLEN REPORT, State of the MHIndustry & LLLCommunities, National Registry of Lenders, ‘Who Ya Gonna Call in 2015 – directory of consultants, Official MH Lexicon, PM Training & Certification Directory, Industry Briefing Sheet (Best there is!), directory of national advocacy entities, only list of HUD-Code manufacturers in the U.S., annual Paradigm Shifts historical timeline, & directory of real estate brokerages.

• And the list goes on, to include: annual Networking Roundtable, periodic FOCUS Group gatherings, deal-making opportunities, even ombudsman (press) services!

Phone the aforementioned Official MHIndustry HOTLINE to affiliate, or request a COBA7® brochure listing all the above opportunities, services, products, and more.

Stop and think about it; this; there’s gotta be a very good reason why COBA7® happens to have the Official MHIndustry HOTLINE all to itself! It’s because, during the past 3 ½ decades, everyone in the MHBusiness has learned where to go for answers. Now it’s time for you to affiliate with COBA7® and become a key part of that special network of ‘MHInsiders’!

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