Circling the Drain or Poised for Resurgence?

Blog # 235 Copyright 2013 3 March 2013

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

I.

A Land Lease Lifestyle Community Contretemps?

II.

Removable Chassis Prompts Excitement & Questions

III.

‘Circling the Drain’ or Readying for Resurgence?

***

I.

A Land Lease Lifestyle Community Contretemps?

‘Yet Another Day (2/25/2013) likely to go down in MHIndustry History!’

On the very same day, 25 February 2013, two separate meetings, among land lease lifestyle community owners/operators, occurred in the neighboring cities of Arlington and Alexandria, Virginia.

In the first instance, the National Communities Council (‘NCC’) division’s executive committee, along with invited guests, met in a closed door planning session, in lieu of the council’s usual biannual meeting, to – in the words of one participant sharing afterwards – ‘Rethink the whole NCC thing and what we should be doing.’ That’s OK for the time being. However, proceedings from this meeting were not even mentioned at the full MHI board meeting the following day, so NCC members must wait and see, or listen for, further enlightenment, if and when it comes….

In the second instance, a small group of land lease lifestyle community owners/operators convened, elsewhere, to review the ‘State of the MHIndustry & LLLCommunity Asset Class today’; ‘How to Maximize ROI via AITR at their properties’ (See end note *1); and, as it turned out, parse the major asset class issue of the day: Need to identify contemporary and new sources of chattel finance pursuant to the self – financing of new and resale homes on – site!

What was accomplished in this latter instance? Following a brief discussion of present day programs (See end note *2), the morning turned creative, as B2P and P2P ‘crowd funding’; creative home finance and ownership partnerships between investors and REITs and other property portfolio owners/operators; and, the need to create a new nationwide ‘manufactured housing’ bank, were discussed at length. End result? The formation of a Task Force, to focus on popularizing the aforementioned sources, and identifying new $ for funding the on – site sale of new and resale manufactured homes within land lease lifestyle communities. If you’d like to participate in this process, contact Spencer Roane, MHM® via spencer@roane.com Serious inquiries only, please.

II.

Removable Chassis Prompts Excitement & Questions

Here’s what one blog flogger (reader) had to say after reading about the possible re – emergence of the removable chassis as an added option to the line of home designs available from HUD – Code home manufacturers:

“I liked your Sunday blog. I liked how you drew on history (i.e. the failed 1990 effort to approve the removable chassis measure to boost HUD – Code housing production) to present day issues (i.e. Again, ‘boost HUD – Code housing production’) for others to move to meaningful solutions!” SL

The latter part of that quote has to do with Advocacy efforts, on the part of the Manufactured Housing Association for Regulatory Reform (‘MHARR’) and the Manufactured Housing Institute (‘MHI’), to advance the removable chassis measure forward successfully, this time around!

So, what’s happening? The removable chassis possibility continues to move forward. As there are worthwhile advances to report, you’ll read about them here; so, as they say in radio, ‘Stay tuned!’

III.

‘Circling the Drain’ or Readying for Resurgence?

Editorial Posture. Everyone likes it when this blog presents – as it has during the past two weeks – clear, succinct recitations of industry issues and trends; as well as HOW TO information useful to land lease lifestyle community owners/operators. On the other hand, when circumstances appear ripe for critique, constructive and otherwise, your responses – while just as frequent, wax supportive and nay saying in near equal measure. Well, circumstances this past week, prompt the following op/ed reporting…

Before I left Indianapolis, to travel East on a week long business trip, lunching and dining with nearly a dozen business associates and clients along the way, one MHIndustry veteran, and former MHI member, opined relative to MHI’s annual Legislative Conference & Winter Meeting, it’d be akin to our industry continuing to ‘Circle the Drain!’

Ouch! But was he right or wrong? While I hope(d) ‘the latter’, it’s difficult – for the following reasons – not to fear the former. (That he’s right).

First the numbers. According to the distributed Registration List, there were 94 individuals in attendance (That’s fewer than number present at MHI’s annual meeting in San Antonio, TX., last Fall), but 13+/- of these were former legislators, governors, and lobbyists. So, of the 81+/- remaining, the best represented group present, at 16+/- , were state MHAssociation executives; then (somewhat surprisingly) 15+/- mostly chattel finance – related attendees (But tellingly, not a single LLLCommunity – focused real estate mortgage originator!); then 14+/- LLLCommunity owners/operators from 13 different firms; and (also surprisingly), 13+/- HUD – Code home manufacturers representing about eight firms. Altogether, those four segments accounted for 58 of the aforementioned 81 industry registrants. And when you subtract the 16+/- MHAssociation executives, from among the 58 subtotal, one is left with 42+/- actual business entities (i.e. Folk with bona fide ‘skin in the game’ of manufactured housing), or half the number present in toto. Not an impressive turnout for an industry struggling to survive.

Recalling the 20+ NCC members present, during the annual meeting ‘ambush’ last Fall; had all of them been present this time around (They weren’t, as their biannual scheduled membership meeting was pre empted by the aforementioned ‘closed planning session’), MHI would/could have had 100+ present for this meeting, something that hasn’t happened in quite some time.

Then the shocker. At Noon on Monday, 25 February 2013, MHI Chairman Don Glisson, Jr., of Triad Financial Services, Inc., resigned his elected position, allegedly for personal reasons. This is an unexpected, unneeded, and unwanted loss for the manufactured housing industry as a whole! Frankly, I suspect there’s more to the story than we’re being told, but I won’t go into that matter here at this time. In any event, Nathan Smith, of SSK Communities, succeeds Don Glisson as chairman of MHI.

Yes, there’s more that could be said, but you get the idea. Bottom line? It’s downright difficult to spark resurgence in an industry routinely attracting ‘less than 100 members and guests’ to biannual membership meetings; loses a good leader midstream; refuses to look beyond a limited Advocacy role and serve all its’ members’ (Not just home manufacturers) need for statistical Research and ongoing Resource services; and finally, not repeat the ‘lesson of 1985’, by catering to the few at the expense of the many (Lest you think I exaggerate by including this final point, take a close look at the proposed changes to MHI’s bylaws, before you decide….).

***

End Notes.

1. ROI: Return On &/or Of Ones’ Investment; &, AITR: ‘Alternative Income to Rent’ theory proposed by multifamily rental property consultant Allen Cymrot.

2. All present day national, super regional, and regional independent sources of chattel financing for manufactured housing, will be featured in the soon – to – be – released 15th annual National Registry of Real Estate & Chattel Lenders. To obtain your FREE copy of this ‘only such $ resource available today’, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and subscribe to the Allen Letter professional journal. The Registry will be distributed as a lagniappe in the March issue of the monthly newsletter.

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

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