by Richard “Dick” Jennison
As President and CEO of the Manufactured Housing Institute (MHI), I participated in a manufactured home communities focused event held this year in San Diego, Calif. During my presentation, I took the opportunity to educate the approximately 250 members of the land-lease community sector of the manufactured housing industry on the work that MHI undertakes each day representing industry interests in Washington, D.C. I also outlined the benefits and importance of the National Communities Council, the only national organization devoted to advancing the interests of manufactured home community owners, managers, developers, lenders, brokers and service suppliers. Such forums as this also provide me an excellent opportunity to hear first-hand from industry members and to clarify and reinforce MHI positions on key industry issues.
The annual gathering of the land-lease manufactured home communities industry drew approximately 250 attendees from 27 states to discuss the state of land-lease communities.
Reinforcing the sentiments of other manufactured housing industry events over the past 12 months, the meeting featured three key themes:
a renewed or new confidence in the role and value of land-lease manufactured home communities;
innovation on the part of manufactured home builders in terms of new, creative designs for homes built specifically for placement in land-lease communities, as well as new financing programs designed to assist communities to retain residents and boost occupancy rates; and
the continuing need for dialogue between financial lenders/analysts and community owners on how to accurately valuate land-lease communities.
On the first point – renewed or new confidence in land-lease communities – it was both somewhat surprising and encouraging to hear more than two dozen investors declare their strong interests in acquiring land-lease communities across all regions of the country. This level of enthusiasm and confidence will be critical in maintaining and rebuilding land-lease manufactured home communities as a viable housing option for low- and middle-income American families.
As to the issue of innovation by manufacturers in home designs, there were numerous “business development officers” from major manufacturers who were there with the sole focus of reaching out to community owners to showcase their new series of manufactured homes designed specifically to accommodate the smaller lot sizes of older land-lease communities. From what I heard and saw, their efforts were greatly appreciated by the community owners who are looking for ways of upgrading and filling their communities with homes that appeal to a broader audience.
Another key factor in maintaining manufactured home communities is helping community owners and managers keep their occupancy rates strong and ensure the financial viability of communities. Several new financing programs designed to build partnerships between the financial services sector and community owners, such as the C.A.S.H. Lending Program from 21st Mortgage Corp., were highlighted and generated a significant interest on the part of the community owners. Again, this ability to fill communities with new residents and new homes is vitally important in maintaining the viability of land-lease communities.
Yet the meeting was not without some points of debate.
There was continuing concern voiced over how financial analysts and investors valuate land-lease communities, with many community owners encouraging analysts and investors to rethink their valuation formulas and approaches. While this “friction” is not ideal, the point is that this issue was openly discussed and methods for resolving it are “on the table.” Such open communication and debate are the proper way to creating valuation methods that serve both the investors’ and owners’ interest.
All of these meeting themes – even the need for ongoing dialogue – reinforce the positive outlook for our industry that I hear and see every day, both from our industry colleagues and from people interested in being part of our industry renewal.
Land-lease manufactured home communities are critically important to the residents who live and depend of them for a “quality-of-life” hard to find elsewhere in today’s housing marketplace, as well as to the owners and operators who have invested so much time, energy and resources to build and maintain their communities.
It is genuinely encouraging to see and hear that all forces within the communities sector are moving in the right direction, looking at the future with confidence and innovation. Such sentiments bode well for both the communities sector and the manufactured housing industry at large. ##
Richard Jennison is President and CEO of the Manufactured Housing Institute (MHI). He can be contacted directly at (703) 558-0678 or visit www.manufacturedhousing.org.