I just returned from George Allen’s International Networking Roundtable for Manufactured Home Community Owners and Operators.  If you are an owner, operator, lender or professional management company you shouldn’t miss this annual event.  It is packed with helpful discussions and break-out sessions and the networking opportunities are incredible.  The event included 160 of the “Who’s Who” in our industry from around the country and sessions ran non-stop from morning until night.  Every attendee comes with the intention of openly sharing information and I have met some of the most informative and helpful people in our industry at this event.  Click here for a few of the highlights. 
 
MH COMMUNITY CLOSINGS were discussed and they are a problem in many parts of the country.  Florida, Arizona, California, Oregon, Washington, Idaho and Nevada have the greatest concentration of closures and local municipalities continue to press for increased regulations given that the industry has virtually no consensus on what to do or any consistent talking points when dealing with the media and the public.  Just last night, the ABC Television affiliate in Portland, Oregon ran a story during their 11:00 PM newscast regarding an older, failing mobile home community Commonwealth is closing in the Portland suburb of Sherwood.  The story was riddled with inaccuracies (they never contacted us for comment) including the statement "one-fourth of all mobile home communities in Oregon have closed in the last year".  The truth is approximately 4% of the communities/spaces have been closed in the last five years.  The also said "a stricter law regulating community closures will likely be discussed in the next legislature" when in fact a more lenient law is being negotiated in the MH Landlord/Tenant Coalition.  There was absolutely no mention of the $10,000 TAX CREDIT available to MH owners  to offset the cost of moving, nor was it mentioned that the $3000/$3500 in cash offered to each homeowner by the community owner was a generous gesture of goodwill to the tenants on his community and something not required by state law.  In Oregon City, Oregon, another Portland suburb the City Council is expected to pass another strict “community closure ordinance” much like other Oregon cities have passed this year.  These ordinances include requiring the community operator to purchase each home at retail value or locate a replacement space for the home and pay the entire cost of moving the home.
 
There is absolutely no doubt that this is a serious and growing issue.  There is also absolutely no doubt that these residents deserve to be treated fairly and their plight properly recognized and examined.  I feel strongly that regardless of what the rental agreement and other documents said when they rented the space, an implied commitment was made between the community owner and the resident that meant: If you pay the rent on time, keep your place up and abide by the rules you can live here indefinitely.  Having said that, no one foresaw the red hot real estate market, sustained record low interest rates and a housing boom like no other in history.  There if a feeding frenzy on develop-able land and manufactured home communities are attractive redevelopment sites to developers.  When you own and operate a community that is worth millions more as something else it is tough for ANYONE to say no to these huge unsolicited offers.  Nevertheless, we should be able to come up with some type of relocation assistance for the residents, and cities, counties and states should actively participate in streamlining the process to acquire and develop replacement communities for these displaced residents.  GOVERNMENT PLAYS THE BIGGEST ROLE OF ALL and they aren’t doing a damn thing towards making land available for replacement communities.  These residents like living in a mobile/manufactured home community, but instead of building them another community and moving them into it, thus retaining them within the industry and building good will, the only thing we’re working on is getting them enough money to leave our industry and move into a house, apartment or condo.  Like we haven’t done enough already in this industry to drive away customers and give away our market share to the site-built the housing builders!!!
 
Manufactured housing shipments were down nearly 13% in July for California as compared to 2005.  Year-to-date Florida is down 42.9%, California is down 33.1%, and Arizona is down 17.2%.   In the Pacific Northwest, shipments have declined.  Washington is down 7.8% and Oregon is down 10%.  The Pacific consensus division as reported by MHI is down 25.2% and the Mountain division is down 18.5%.  But the industry nationally is trending down only slightly.  However, total “floors” shipped in July 2006 were 14,290, down 15.15% from July 2005.  Through July total HUD-coded shipments were essentially unchanged according to MHI when compared to 2005.  States with the greatest increases in July included Mississippi + 58.7%, Louisiana + 51.4% and Alabama + 20.9%.  Idaho was also looking good, +27.8%.
 
I love this industry and I want to be a part of its growth and prosperity.  Doing the right thing for our consumers and building public awareness of the quality and affordability of our product needs to be heavily promoted on a national level.  We need  to win back homebuyers, go after the young, first time buyer and get back the market share we gave away during the biggest housing boom in history.  There is a groundswell building across the country, pushing for a national marketing and public relations/public education campaign geared to promote manufactured housing.  Stay tuned as we discuss this in more detail in the near future.
 
SAVE THE DATE.  Commonwealth’s 5th Annual Manufactured Housing Industry Summit will be Thursday, January 25, 2007 at the Red Lion Hotel on the River in Portland, Oregon.  Visit our website soon for details.

Greg Harmon - President
Commonwealth Real Estate Services
E-mail: greg@cwres.com
Telephone 503.244.2300 Ext. 101