March/April 2022 by MHInsider

THE MAGAZINE FOR MANUFACTURED HOUSING PROFESSIONALS

RETAIL EDITION MARCH / APRIL 2022 | MHINSIDER.COM

MHI KEEPS MANUFACTURED HOUSING ON THE NATIONAL AGENDA RETAIL SALES IN THE SOUTH CONTINUE TO EXPAND TAMMAC MAKES BIG RE-ENTRY TO INDUSTRY

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PAGE 39

CONTENTS

RETAIL SALES IN THE SOUTH

Clayton Home Centers in the South provide a multi-state system of retail locations for a variety of homebuyer preferences.

HAPPENINGS 6 Industry Happenings INDUSTRY NEWS 11 MH REITs Report: A Quarterly Overview of Manufactured Housing Industry Real Estate Investment Trusts 16

Reconstructing the Trades

GSE Reform is Alive… But Not by Much

EVENTS 25 Manufactured Housing Industry Events 26

Franklin Homes Debuts at IBS ‘22 in Orlando

Biloxi Offers Historic Gulf-Side Venue for New MH Expo

31 Congress and Expo Features ‘The Neighborhood’ of New Homes, Keynote Panel with Top Builders

2 | MARCH / APRIL 2022 EDITION

VOLUME 5 • EDITION 2 MARCH / APRIL 2022 MHInsider.com Publisher

Patrick Revere patrick@mhvillage.com

Senior Graphic Designer Merit Kathan merit@mhvillage.com

Contributing Editor George Allen gfa7156@aol.com

PAGE 51

Tammac Holdings, a Wilke-Barre, Pa.-based business that works in multiple industries and sectors, has made a strong re-entry to manufactured housing with a goal of providing $700 million in financing during the next three years.

Editor

Sean Vichinsky sean@mhvillage.com

Contributors

Nick Bertino Erik Edwards Suzanne Felber Dr. Lesli Gooch Matt Herskowitz Dawn Highhouse Tony Petosa Alex Pettee

Cover Image

COMMUNITY 32 Havenpark Spends $24 Million In Community Upgrades 35

Top Community Amenities

BUILDER 44 Top Builders Invest in North Carolina 48 Black Palm Siding Enters the Market LENDING 54 Yesterday Once More ADVOCACY 59 Longtime WMA Executive Retires 60 A Word From the State Execs 72 MHI Keeps Manufactured Housing on the National Agenda THE ALLEN LEGACY 76 The Evolution of Community Appraisal PART 2

Cover Photo Courtesy of Clayton Homes

Advertising Sales

(877) 406-0232 advertise@mhvillage.com

Editorial & General Inquiries Patrick Revere 2600 Five Mile Road NE Grand Rapids, MI, 49525 (616) 888-6994 patrick@mhvillage.com

Disclaimer

Although we make every effort to ensure that the information in this issue was correct before publication, MHVillage, Inc. and the publisher do not assume and hereby disclaim any liability to any party for any loss, damage, or disruption caused by errors or omissions, whether such errors or omissions result from negligence, accident, or any other cause. Opinions expressed are those of the author or persons quoted and not necessarily those of MHInsider or the publisher MHVillage, Inc.

Copyright ©2022 MHVillage, Inc. All rights reserved. Reproduction of MHInsider content, MHI or other contributor content, in part or in whole, is prohibited without written authorization from MHVillage, Inc.

MHInsider™ is published by:

2600 Five Mile Road NE Grand Rapids, MI 49525 (800) 397-2158 www.MHVillage.com MHINSIDER.COM | 3

FROM THE

publisher

Build the Shelf

In most industries, the leading professionals look at the business opportunity in front of them as a big pie, one that draws you in to take a slice, a larger one all the time if you can. The manufactured housing industry, particularly in today’s market, is a different consideration. No matter what your market share may be, the view of that single pie sitting on a large shelf alone is a bit unsettling. An analysis at the end of last year by housing-focused economist Gleb Nechayev, head of research and chief economist at Berkshire Residential Investments, noted that the U.S. now seems to be more than 2 million units behind schedule in housing production, the highest in at least 30 years. “The market clearly needs substantially more new housing for both renter and owner-occupancy and in both single-family and multifamily segments,” he stated. “Our prior analysis based on other data sources strongly suggests that virtually all this new supply is needed at the middle and lower ranges of the price spectrum.” There we sit, amid pie crumbs and with a load of empty space on that shelf for pies of all shape, color, and taste.

4 | MARCH / APRIL 2022 EDITION

When manufactured housing is a primary contributor — more so all the time — to that vital middle market, the onus is on each of us to envision the pie that’s yet to be baked, the next taste the consumer may want, and most importantly in recruiting and building the partnerships needed to fill that shelf. Maintaining capacity to meet the unprecedented current demand clearly is at the forefront, but not at the expense of innovation and industry development. These are topics that will be at the center of conversation if at no other time, then certainly during our industry spring gatherings in Biloxi and at the Congress and Expo in Orlando. Happy networking and strategizing manufactured housing professionals, all of your knowledge and energy is needed, the health and safety of so many homebuyers here and now abroad depend on it.

Patrick Revere is associate vice president of MHVillage and publisher for the MHInsider magazine and blog for industry professionals. His background is in print news, language, and communication.

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Happenings

Indu stry

HAPPENINGS

Transactions Shopoff Realty Investments Sells Three Illinois Communities, 611 Homesites Shopoff Realty Investments , a national manager of opportunistic and value-add real estate investments,

170 new jobs and allowing Impact Housing to serve the southeastern market.

Forrest Street Partners Buys 255site Arkansas Community

has sold its 611-homesite, three-property portfolio of

Southern Pines, a manufactured home community

manufactured housing communities in North Central

near Little Rock, Ark., has been purchased by Forrest

Illinois to Clear Sky Capital. The three properties

Street Partners. Forrest Street partner Todd Baldree

include Oak Creek Estates, in the City of Bourbonnais,

said 181 of the 255 homesites at Southern Pines are

55 miles from Downtown Chicago, Lincoln Terrace,

occupied. FSP has plans to asphalt all roads in the

in Lincoln, equidistant to Bloomington and Spring-

community, upgrade the office and mail kiosk,

field, and Belle Aire, located in Marseilles, 80 miles

pressure wash, and re-skirt homes that need updates

southwest of Chicago. Shopoff had purchased the

while adding about 40 new homes.

portfolio in April 2021.

Arizona Owner Invests in Florida EcoVest Opens Atlanta-area Homebuilding Operation

Cove Communities, a Phoenix-based portfolio owner, has purchased Jamaica Bay in Fort Myers. The 55+

EcoVest Capital and Place Properties have formed

community has 1,400 homes, three clubhouses, pools,

a new organization, Impact Housing Group, a fully

tennis, and a library, and is a destination 230-acre

integrated, volumetric modular homebuilding com-

property along the gulf coast.

pany. Its mission is to provide a solution for affordable homes for working families. The new organization has acquired a facility in Baxley, Ga., to assemble more than 50 single-family homes per month, providing

6 | MARCH / APRIL 2022 EDITION

Manufactured Housing Properties Inc. Buys Three Properties Manufactured Housing Properties Inc. has acquired three communities in the area of Charlotte, N.C., totaling 301 homesites. A pair of the communities are in Asheboro and the other is in Morganton. The company now has 43 owned and operated manufactured home communities with 2,044 sites.

Capital Square 1031 Buys Florida Community Capital Square 2031, has acquired Palm Lake Club, a 55+ manufactured housing community in Sebastian, Fla., the organization’s 10th age-restricted community in the state. Palm Lake Club is close to city parks, shopping, golf courses, and wildlife preserves. Onsite

Colorado Residents Purchase Community

amenities include a heated pool, clubhouse, library,

ROC USA® Network has assisted Leadville MHC

recreational facilities, a shuffleboard court and a

residents in the purchase of their community, the

seven-acre lake surrounded by resident homes. Capital

sixth resident-owned community in Colorado. This

Square Chief Strategy and Investment Officer Whitson

community was offered for sale to the residents by the

Huffman said they plan to make upgrades to the

owner. Negotiations with the previous owner began

clubhouse, landscaping, outdoor lighting, roadways

in early 2021 and the deal closed by the end of the

and other amenities that will further enhance the

year. The seller said he is passionate about the ROC

value of the property to residents and investors alike. »

concept, with more to come in the future.

MHINSIDER.COM | 7

Happenings

Law Firm Changes Names in Succession Hart King, highly regarded in the manufactured housing practice, has changed its name to Hart

Capital News Funding for Manufactured Housing Allocated in NY

Kienle Pentecost to reflect new firm leadership and

More than 60 grants worth $25 million were

completing transition and transfer of firm ownership

awarded through New York state and federal-

from founder Bill Hart. Kienle and Pentecost will

ly funded programs including to Mobile and

lead the firm into 2022 and beyond with a shared

Manufactured Home Replacement, a non profit

commitment to maintain and deliver the personalized

that assists low- and moderate-income homeowners

and full-service legal expertise that has been the

to replace dated homes.

cornerstone of the firm for the last 40 years.

“Every New Yorker deserves the dignity and stability of a secure place to live, and this funding will provide

Yale Capital Reports on Strong Close to ’21

much-needed support to affordable and supportive

Closing out a record-breaking year in December

housing services,” Governor Kathy Hochul said. “These

2021, Yale Advisors transacted on $154 million

grants will go toward small communities all across

through 11 properties across the nation. Yale’s De-

the state, and they will fund critical programs that

cember volume consisted of eight manufactured

provide immediate assistance to New Yorkers in need.

home communities three RV resorts, and one hybrid community, totaling 2,157 sites.

84-Site Bozeman Community Sells

Honors Florida College Honors Residential Constructions Trade Nonprofit

Hidden Valley Estates in Bozeman, Mont., on 30

Florida Technical College has named Building Tal-

acres near Interstate 90 sold in early 2022. The family

ent Foundation, a non-profit organization committed

community, built in 1973, has been at or near full

to building a sustainable residential construction

occupancy. It has off-street parking and a playground.

workforce, as its 2021 Construction Trades Partner of the Year. The FTC Distinguished Partnership Awards

Southern California Property Changes Hands

honor and recognize a leader or an organization that

Royal Palms Mobile Home Estates in Tulare, Calif.,

works to strengthen the pathway between college

has been sold for a reported $10.2 million. The age-re-

coursework and career success, demonstrates strong

stricted community near 96-site manufactured home

commitment to providing work-integrated learning

community was owned by Three Pillars.

opportunities, and hiring of FTC students, and/or has shown a high level of overall support of FTC’s

Gemstone Communities Expands in 2021

mission. “Building Talent Foundation has become a

Gemstone Communities in 2021 completed a $93

critical and important partner for FTC,” FTC President

million recapitalization of 13 of its Southwest Florida

Dr. James Michael Burkett said. “Thanks to the great

properties. In addition, Gemstone has acquired four

partnership we have with the organization, it has led

properties in the fourth quarter of 2021, two in the

to remarkable programs designed to empower and

Amarillo, Texas — Adobe Estates and Southgate Man-

further the development of our students.”

ufactured Housing Community— as well as Pepper Point in the Shreveport, La., and Homosassa Springs in Homosassa, Fla. The four properties consist of over 750 units and brings Gemstone’s portfolio to 51 properties with more than 6,500 homesites.

Alabama Association Announces State HOF Inductees Eric Boehm and Bart Mercer have been inducted into the Alabama Manufactured Housing Industry Hall of Fame, the state association recently announced. A ceremony was held on Feb. 16. Boehm is a successful regional vice president for Clayton Homes, located in Maryville, Tenn. Boehm is respon-

8 | MARCH / APRIL 2022 EDITION

in December. Born on Feb. 19, 1958, to Dr. Joseph and

locations and over 200 employees. His Clayton Homes

Dorothy Turk of Athens, he graduated from Ath-

career began in 2003 as a general manager. Mercer

ens High School and attended Sam Houston State

has more than 30 years of business experience as

University. He proudly served in the U.S. Navy on

the vice president of Jenilyn’s Creations, Inc. He

Midway Island and after was an integral part of the

is president of Mercer Property Management, Inc.

manufactured housing industry his entire life. He

and serves on the Alabama Manufactured Housing

will be greatly missed by his wife Norma of Robinson,

Board of Directors where he served as chairman for

sons Wyatt and Clayton, sisters Joan Turk and Rynda

three years. Mercer is a licensed home builder, land-

McMurray, his three nieces and a nephew, as well as

scaper, and serves on boards including the National

his Oak Creek family and the many suppliers and

Association of Counties’ Broadband Task Force, and

retailers he worked with for years.

the Elmore Fire Department.

Industry Giving Yes Communities Volunteers Renovate Resident’s Home

Industry Mourns Veteran Communities Professional Wally Moreland passed away Jan. 10, 2022, less than one month after

Sandhill Shores in Fort Pierce, Fla., owned and

receiving a diagnosis of Acute My-

operated by Yes Communities, completed a vol-

eloid Leukemia, four days before his

unteer effort to renovate the home of a longtime

75th birthday. He worked with Yes

resident. Employees and local vendors pitched in

Communities for 40 years, having retired in 2019.

on the Hug-A-Home effort. Each year Yes Commu-

Mr. Moreland attended NW Louisiana State and

nities team members donate thousands of hours

received his Bachelor of Science degree in physical

and other vital resources toward Hug-A-Home and

education. Born to Edward A. and Anne Moreland

other programs. “This is the kindest thing anyone

on Jan. 14, 1947, in Peoria, Ill., he is survived by his

has ever done for me and I’m grateful for Sandhill

wife Helle, son Dane (Vanessa), and daughter, Kara,

Shores and Yes Communities for doing this,” 25-year

as well as five grandchildren. Nothing pleased him

resident Connie Silvas said.

more than cooking special breakfasts, dinners, or holiday meals for loved ones and friends. His wonderful sense of humor kept everyone feeling positive. His optimistic outlook always made anything seem brighter. He was the rock of the family. In lieu of flowers, please consider donations to be made to the Lymphoma and Leukemia Society.

Manufactured Housing Advocate, Lumber Supplier Passes Donald L. Harris, 74, an executive with Universal Forest Products, died Jan. 15, 2022. Mr. Harris proudly served in the U.S. Army, attended Franklin and Marshall College, and studied engineering at Rochester Institute of Technology. He retired as president and chairman of the board for UFP, providing the industry

In Memoriam Longtime Texas MH Pro Passes Will Turk, the sales manager for Oak Creek Homes

with treated lumber building products. He is survived by his wife Sandy, two daughters, Tracey and Ashley, son J. Tyler, and four grandchildren.

and a longtime resident of Athens, Texas, passed away MHINSIDER.COM | 9

Happenings

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by Alex Pettee

The research team at Hoya Capital Real Estate is

sites across the United States with a portfolio skewed

excited to continue our quarterly column published

toward higher-end communities with a more

in partnership with MHInsider to provide insight and

“retiree-oriented” demographic than the all-ages

commentary on publicly-traded manufactured hous-

community.

ing stocks. Every quarter, we’ll publish an update to

Through a series of acquisitions, Equity Lifestyle

discuss the stock performance, earnings results, and

and Sun Communities have recently expanded into

major news and events reported by manufactured

boat marinas as well, while the smaller UMH Proper-

housing real estate investment trusts, or MH REITs.

ties and newly-listed Flagship Communities continue to focus primarily on traditional manufactured

Overview of MH REITs

housing communities.

There are three U.S. exchange-listed Manufactured

Manufactured housing REITs have emerged over

Housing REITs that collectively account for roughly

the past decade from relative obscurity into several

$35 billion in market value: Equity Lifestyle (ELS),

of the largest publicly-traded owners of real estate

Sun Communities (SUI), and UMH Properties (UMH).

in the world. Beneficiaries of the lingering housing

Additionally, newly-listed Flagship Communities

shortage across the United States resulting from

(FLGMP) trades on the Toronto Stock exchange.

a decade of underbuilding, manufactured hous-

Manufactured Housing REITs collectively own

ing REITs have been the single-best performing

roughly 350,000 manufactured housing and RV

REIT sector since the start of 2010, delivering an » MHINSIDER.COM | 11

Industry News

MH REITs Report: A Quarterly Overview of Manufactured Housing Industry Real Estate Investment Trusts

Industry News incredible 24.3% annual compound total returns

which was only a bit higher than the average annual

from 2010 through 2021.

increase of 3.5% over the past decade.

With total returns of 42%, manufactured housing

Manufactured Housing REITs still managed to

REITs outperformed the broad-based Equity REIT

deliver their strongest year on record across nearly

Index for a remarkable ninth-straight year in 2021,

all critical earnings metrics. Driven by strong perfor-

the longest streak of outperformance for any property

mance in their RV segment and occupancy increases

sector since the dawn of the “Modern REIT Era” in

in their core manufactured housing parks, the three

the early 1990s.

major MH REITs – ELS, SUI, and UMH - delivered

From an investment perspective, despite their high

same-store NOI growth of 10% for full-year 2021 and

growth rates, MH REITs are a traditionally defensive

these REITs are expecting NOI growth of another 8% in

and countercyclical sector due to the “sticky” nature

2022 at the midpoint of their initial financial outlook.

of MH demand and cash flows. While these REITs

Growth in funds from operations (“FFO”) — the

are not known for their high dividend yields, these

earnings per share “equivalent” for REITs — is driven

REITs have delivered some of the strongest rates of

by the combination of same-store “organic” growth

dividend growth of any REIT sector.

and by external growth through acquisitions and new development. Manufactured housing REITs delivered

Recent MH REIT Fundamental Performance

incredible FFO growth of over 22% in 2021, which

Symptomatic of the lingering housing shortage

was significantly above their earlier estimates and

in the United States, rents are soaring at the fastest

was the strongest year of FFO growth on record for

pace on record in essentially every segment of the

all three of these REITs. The initial outlook for 2022

residential rental market across the country. Inter-

calls for average FFO growth of 8.1%, but these REITs

estingly, manufactured housing renters have so far

have historically provided conservative estimates in

escaped the double-digit rates of rent growth seen in

their initial outlook and raised their growth targets

apartment and single-family rental markets, as MH

throughout the year, so another year of double-digit

REITs raised rents by just 3.9%, on average in 2021,

earnings growth is certainly achievable.

12 | MARCH / APRIL 2022 EDITION

have continued to grow externally by adding units

2022, predicting another record year with 614,000 shipments anticipated by the end of the year.

to existing sites and by growing via acquisitions and

The National Marine Manufacturers Association

site expansions. MH REITs acquired $2.15 billion

(NMMA), meanwhile, reported last month that

worth of property in 2021 – the largest full-year total

following record sales in 2020, powerboat sales

on record. The most significant deal in 2021 was Sun

exceeded 300,000 units for only the second time in

Communities’ $1.3 billion purchase of Park Holidays,

15 years. As of early January, the NMMA is projecting

which is the second largest owner and operator of

new boat sales to exceed the 300,000 unit mark for

holiday communities in the UK, with 40 owned

a third straight year and surpass 2021 totals by as

and operated communities and an additional two

much as 3%. Sun Communities has been the most

managed communities. The acquisition, which is

active of the four MH REITs in growing their marina

expected to be accretive to 2022 Core FFO per share,

business, which now accounts for nearly 20% of its

will represent approximately 7% of the company’s

annual revenues. Marinas offer substantial operating

properties and 8% of its total real estate asset value.

parallels to the RV business and SUI is now the largest owner of marina slips in the United States, followed

Manufactured Housing Industry Data Points

closely behind by Equity Lifestyle.

MH REITs’ amplified focus on analogous asset classes — RV parks and marinas — was perfectly timed,

MH REITs Key Takeaways

providing an added external growth tailwind as the

While the share prices of MH REITs have unchar-

“Work-from-Anywhere” era has fueled soaring RV,

acteristically lagged through the first two months of

boat, and vacation home sales. The RV Industry Asso-

2022 as the sector has been pressured by concerns

ciation (RVIA) reported in January that despite supply

over rising rates, inflation, a broader rotation from

chain issues and labor shortages, 2021 was the best

growth into value, the long-term fundamental outlook

year on record for shipments of recreational vehicles

for the sector remains highly promising given the

with 600,240 RVs last year — beating 2017’s record by

lingering undersupply of housing units across the »

19%. The RVIA sees the momentum continuing into

MHINSIDER.COM | 13

Industry News

Utilizing a strong cost of equity capital, these REITs

April 11-13, 2022

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profitability of real estate portfolios. NOI equals all

providers of affordable housing.

revenue from the property, minus all reasonably

Consistent with the trends across the residential

necessary operating expenses.

REIT sectors over the past 12 months MH REITs delivered their strongest year on record in 2021

Hoya Capital Disclosures

across essentially every critical earnings metric,

I am/we are long ELS and SUI. I am not receiving

and the momentum is expected to continue into

compensation for it. It is not possible to invest di-

2022. Low supply and strong demand have driven

rectly in an index. Index performance cited in this

stellar fundamental performance for MH REITs over

commentary does not reflect the performance of

the past half decade, and shareholders have been

any fund or other account managed or serviced by

rewarded with a record-setting nine consecutive years

Hoya Capital Real Estate. Nothing on our website

of outperformance relative to the REIT sector average.

nor any published commentary by Hoya Capital is intended to be investment, tax, or legal advice or an

MH REITs REPORT Terms Defined

offer to buy or sell securities. Information presented

FFO (Funds From Operations): The most common-

is believed to be factual and up-to-date, but we do not

ly accepted and reported measure of REIT operating

guarantee its accuracy and should not be considered

performance. Equal to a REIT’s net income, excluding

a complete discussion of all factors and risks. A com-

gains or losses from sales of property and adding back

plete discussion of important disclosures is available

real estate depreciation.

at www.HoyaCapital.com. MHV

AFFO (Adjusted Funds From Operations): A

Alex Pettee, CFA, is the director of research

non-standardized measurement of recurring/nor-

at Hoya Capital Real Estate, a research-fo-

malized FFO after deducting capital improvement

cused Registered Investment Advisor based

funding and adjusting for “straight line” rents.

in Rowayton, Conn, and founded with the

NOI (Net Operating Income): Typically report-

mission of making real estate more accessible

ed on a “same-store” comparable basis, NOI is a

to all investors. Hoya is among the most widely-read and

calculation used to analyze the property-level

cited publishers of real estate commentary and research.

MHINSIDER.COM | 15

Industry News

United States and these REITs’ position as leading

Industry News

Reconstructing the Trades by Patrick Revere

Tim Taylor has worked alongside the National

force of craft professionals as well as expanding

Center for Construction Education and Research

it s comprehensive work force development

for more than a decade, but just at the beginning

system and curricula selection.

of this year, he came on in a newly formed position

He had been at the University of Kentucky in

to conduct research and provide solutions to repair

the civil engineering department. Focusing on the

the vital craft and trade work that for decades

craftworker shortage in his research, and providing

has been ill-supported.

innovative solutions that other groups, like NCCER,

NCCER, based in Alachua, Fla., dates back to the early 1990s when leading contractors came together to

would carry out. In 2018 Taylor and NCCER published “Restoring the Dignity of Work”.

standardize training and provide industry-recognized

“We do some really cool things here,” Taylor said

credentials. Over time, NCCER has expanded to be-

of NCCER. “I’ve worked with them for a long time

come the industry’s source for training, assessments,

and some of the programs are new even to me.

and certification. NCCER continues to evolve beyond

It’s very exciting.”

the construction and maintenance industries both domestically and globally. Today, NCCER develops curricula for over 70 craft areas that have been used in all 50 states and in 20 countries.

Extended Research, Work in the Trades Taylor said his mindset, and that of the staff and partners at NCCER, is to address the problems that

Taylor is the organization’s new director of

affect as many people as possible, including the trade

research, heading up the continued effort to

workers, their families, and the families they build

build a safe, productive, and sustainable work-

for and help support.

16 | MARCH / APRIL 2022 EDITION

NCCER found that with many households enjoying

ber one challenge we have in construction,” Taylor

a dual income, it made it more difficult to pull up

said. “We look at this from the standpoint of how to

and leave if a job moved from one part of the state to

study the trades, and we want to study the questions

another, or to a different state altogether. A second

that construction professionals care about.”

certification, another skill, might mean the difference between a contract job and full-time employment, or

Revisiting Questions of the Past One solution to the craft shortage that has been put forward in the past is the idea of multi-skilling.

extended full-time employment. “They need to stay on in a geographic region,” Taylor said.

Multi-skilling is when craft professionals gain train-

Another observation NCCER plans to address is

ing and experience in multiple trades. In a recent

the demographics of its entry-level workers versus

research project, the group re-asked a 20-year old

the typical age of a college student. The average age

question about the reasons for multiskilling and

of a college student is 20, and the average age of a

found that the answers had changed. In the late

construction trades apprentice is 28.

1990s tradespeople said they were getting added

“There is something happening in that time in

training, additional certificates, or taking advantages

between,” Taylor said. “We’re missing 8-10 years that

of other career development opportunities because

are important in getting tradespeople moving into

they might be able to earn additional hours, get

and up in the industry.”

paid overtime, or would be kept on a job site longer through the phasing of a project. In 2022, “I don’t want to move,” was the answer, Taylor said.

More information on NCCER and its research efforts can be found at www.nccer.org. NCCER’s plan for restoring the craft workforce is available at https:// www.nccer.org/news-research/research/rt335. MHV

Website

MHINSIDER.COM | 17

Industry News

“In my mind, the craft worker shortage is the num-

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Industry News

GSE Reform is Alive… But Not by Much

In mid-February, Don Layton, senior fellow at the

Harvard Joint Center for Housing Studies, posed a question that might startle or even frighten many manufactured housing professionals.

toward many of the Biden Administration’s priorities, fair housing in particular. On the cover, it may not seem like much. But for those in the industry who have been dismayed with

The question: Is GSE Reform Dead?

the Enterprises’ collective lack of pursuit in chattel

As Layton explains, no it is not.

lending, and achingly slow progress on Duty to Serve,

This is all against the backdrop that the GSEs gained

the story of rapidly increasing market share may have

market share in single family, and have demonstrated

to be enough for now.

strong profitability as housing prices have gone up.

They are 14 years into conservatorship, a legal state

“You don’t get a lot of loan loss when everyone has

of oversight that was to end long ago. Yet, it remains

10% more equity, for instance, in their homes,” Layton

— largely as a means of urging reform. Though talk of

said in an interview with MHInsider.

exiting conservatorship was common in the Trump

The GSEs also have announced various initiatives

administration, and among FHFA leadership includ-

that reflect the FHFA after the Supreme Court ruling

ing with Director Mark Calabria, the discussion has

that eliminated their independence and are working

tapered off with the change in leadership. » MHINSIDER.COM | 19

Industry News

In that light, Layton provides insight on a set of

Through the ebb and flow of political sentiment

reform initiatives, some of which have faded into

and policy ideals, Layton says that in 2018 the housing

the background while growth elsewhere continues.

finance policy community and the mortgage industry moved “away from revolution” and toward evolution.

Status of Reform Initiatives in Housing “From 2009–2016, individuals and groups from a

Support to keep the GSEs became a matter of avoiding disruption to our complex mortgage markets.

variety of backgrounds — including industry asso-

“This change also reflected a political rehabilitation

ciations, policy advocates on both the political left

based upon the companies performing unexpectedly

and right, academics and, of course, government

well during their decade of conservatorship and

officials — made proposals that eschewed incre-

during the pandemic,” Layton said.

mentalism and looked to replace the GSEs with ‘something different,” Layton writes.

GSE Reform Quietly Underway

The ideas included a single, government-owned

Layton says that the most important current GSE

monopoly, many smaller competing GSEs, one or two

reform activity involves both Fannie and Freddie

cooperatives owned by the primary mortgage lending

retaining all their earnings to build capital.

industry, and a full wind-down of the two companies

“I cannot emphasize enough how important this

with the private market left to somehow replace the

is. First, it makes the GSEs more financially stable,

volume of mortgages previously financed by the GSEs.

meaning that during conservatorship they are less

As these proposals called for the GSEs to be replaced,

likely to call on the taxpayer, through Treasury, to

they were often referred to as “comprehensive GSE

make additional cash injections into the companies

reform”, Layton writes.

if losses were to be incurred,” he writes. “Second, it makes a conservatorship exit, whether by legislative or administrative means, much easier to implement.” The capital accumulation began late in the Trump administration and continues with the Biden administration. As of Sept. 30, 2021, the latest figures available at press time, the GSEs between them have a net worth of $67.5 billion, a much-improved position over the near-zero figure of just a few years earlier. The second reform activity underway is the FHFA,

Written Insured Warranties specifically designed for Manufactured Housing

under acting Director Sandra Thompson, making important if limited revisions to the Calabria-era regulatory minimum capital rule, which is widely viewed as (i) calling for an unnecessarily high level of capital, as well as (ii) being poorly structured as it creates incentives for the GSEs to make uneconomic

The MHWC Warranty provides unrivaled protection for your business against unexpected surprises or potential financial burdens, firmly preserving your bottom line. With MHWC, you will limit your liability, dial back your risk, and save time and money. Contact me for a quote or more info. Stress less and score big with MHWC!

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Tifanee McCall 800.247.1812 Ext. 2132 sales@mhwconline.com www.mhwconline.com

22 | MARCH / APRIL 2022 EDITION

decisions. The limited revisions now underway are designed to eliminate (i) a perverse incentive for the GSEs to take on high-risk mortgages and (ii) an equally perverse disincentive to lay off mortgage credit risk to institutional investors. These two paths may be the only remaining active reform initiatives underway with the GSEs, but they are extremely important measures, Layton asserts. MHV

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Events

2022 MHCA Annual Conference

housing professionals with an update on the economy,

and Golf Tournament

recent legislation, COVID liability issues, and other

Tuesday, May 10 — Thursday, May 12

trending topics in Florida and around the country.

Fort McDowell, Ariz. — We-Ko-Pa Resort

Attendance, exhibitor, and sponsorship opportunities

Located a short drive from the Sky Harbor airport

are currently available.

and just north of Scottsdale, We-Ko-Pa offers a prime locale to meet, exhibit, and shop for the latest industry developments and trends. With awe-inspiring views

2022 Multi-State Convention

and a day of great golfing, Manufactured Commu-

Saturday, July 23 — Monday, July 25

nities of Arizona invites manufactured housing

Orange Beach, Ala. — Perdido Beach Resort

professionals for a productive three-day outing in the

Join the Alabama, Louisiana, and Mississippi

desert. Inquire for sponsorship and exhibitor details.

manufactured housing associations to explore valuable networking opportunities, attend banquets, educational seminars, and state-specific continuing

Florida Manufactured Housing

education. Attendees can explore an upscale marina

Association Annual Convention

near the resort that offers deep-sea fishing, dolphin

Tuesday, June 21 — Wednesday, June 22

excursions, boutique shopping, a day spa, and local

Tampa Fla. — Grand Hyatt Tampa Bay

eateries. Of course, a round of golf is nearby at a

FMHA welcomes back members and guests with an

number of signature courses. Registration, exhibitor,

annual industry meeting that will help manufactured

and sponsorship opportunities are available.

If you have an event or gathering — virtual or in person — you would like to have listed with MHInsider, please contact us at: www.mhvillage.com/pro/manufactured-housingindustry-trade-shows/

MHINSIDER.COM | 25

Events

MANUFACTURED HOUSING INDUSTRY

Photos courtesy of Lisa Stewart Photography.

Franklin Homes Debuts at IBS ‘22 in Orlando by Suzanne Felber

It takes a lot of perseverance and downright guts to

step out of your comfort zone to try something new, but that is exactly what Franklin Homes did this year by making their debut at the International Builder’s Show in Orlando, Fla. After showing their modular homes in the traditional industry shows, this year they decided to show their homes to site builders and other building professionals who might not be as familiar with Franklin, or factory-built homes. The Domino V home was a modular, off-frame build with a more contemporary feel. At over 2,300 square feet, the home was promoted as an “off-site-built product with a high degree of energy efficiency that helps lower monthly costs for homeowners,as well”. Fred Carl and C3 Design are no strangers to the site-built industry. Carl is the founder and former CEO of Viking Range Corp, a company that he sold in 2012. He was always looking for a better way to build a well-constructed, beautiful home and saw that factory-built homes could be the perfect solution.

26 | MARCH / APRIL 2022 EDITION

helping guide the company toward building a home

and innovation more than cost-cutting, they have been able to stake a claim.

that developers would be interested in using in their

The company is also very focused on designing

site-built communities, and one that would draw the

market-specific designs. In the past two years they

appreciation of homeowners with innovative designs

opened one of their first retail centers in Austin, Texas.

and energy-saving features.

They also sell to over 94 retail locations in 14 states.

The Domino Series definitely accomplishes that.

If the Domino show home is any example, we will be seeing a lot more of Franklin and their PreFab-brand-

Homes in the ‘Village’ KBIS and IBS ‘22 in Orlando served as a much-await-

ed modular homes at other non-industry events, as well as at our favorite industry shows. MHV

ing return to in-person events for builders and

Lifestylist Suzanne Felber has been active

suppliers worldwide, drawing more than 70,000

in the housing industry for more than 30

professionals to the Orange County Convention Center

years. Felber realized that factory-built

in early February.

housing was the housing of the future, and

Franklin was joined by Genesis Homes by Champion

has been actively working to promote the

in the outdoor village, for the second time in three

lifestyle ever since. She started American Housing Advo-

years (IBS 2021 was held virtually).

cates as a way to share the great news about manufactured

The Franklin PreFab line offers a broad selection

housing. To learn more about her work, visit www.lifestylist.

of designs and styles, and each floorplan and set

com and www.americanhousingadvocates.com, or read her

of home interior options can be customized for

@lifestylist social media posts.

the buyer. Though many prefab buyers intend to install the Franklin series on a foundation and with the local modular code, Franklin PreFab also can be built to the HUD code and can be placed as a manufactured home. Franklin also understands the importance of building strong relationships with your vendors —

A non-proﬁt housing organization

something that Carl is very familiar with on both the Viking and Franklin sides of his career. Blake Jackson is the sales manager for Franklin Homes. He said they are the largest solid surface customer in the industry with Shaw, and over 85% of the homes they build feature ceramic showers. “Franklin understands that big kitchens and nice bathrooms make a lasting impression with consumers,” Jackson said. “We decided to brand our homes using reputable, mainstream products in these areas where the quality of the product matches the quality of the home.” For instance, Franklin has forged a relationship

We buy properties. Talk to us about selling your community today!

with GE Appliances, which has helped the company tremendously during the appliance shortages of recent few years. Jackson said the goal is to have “the highest quality in the business”. By partnering with companies like

etaylor@augustacommunities.org (909) 981-0192 augustacommunities.org

LG and Shaw that are also focused on high quality MHINSIDER.COM | 27

Events

Since purchasing Franklin in 2015, he has been

Events

Biloxi Offers Historic Gulf-Side Venue for New MH Expo

The historic city of Biloxi in 2022 hosts the newest

Sound lighthouses, which was built in Baltimore and

industry trade show on the circuit, with an impressive

shipped down for completion in 1848. Through wars,

list of retail- and community-oriented sales and oper-

hurricanes, and social disruption, it stands today as

ations seminars presented by leading manufactured

a registered historic site and a point of state pride.

housing professionals from across the country.

Biloxi also is a gaming center, with more than half

Situated on the Gulf of Mexico at the mouth of the

a dozen destination casino resorts, including the IP

Tchoutacabouffa River, pronounced “CHOO-tah-kah-

Casino and Spa, home base for the new event, and

buff”, it and its sister city Gulfport are renowned for

one of the grandest hospitality centers in the country.

local seafood flare, architecture, and monuments that

For attendees of the Biloxi Manufactured Housing

mark its long native, French, and American history.

Expo from March 28-30, the gulf port is a welcoming

For generations the newly enlisted came to Biloxi

venue to brush up on the latest offerings in the in-

for training and service at Keesler Air Force Base.

dustry, learn from manufactured housing experts,

Biloxi is home to one of two remaining Mississippi

and entertain new and existing clients.

The Biloxi Expo Education Schedule Retailer Seminars Tuesday, March 29, 2022

10:00 - 10:50 a.m.

9:00 - 9:50 a.m.

How Today’s MH is Changing the Industry

Virtual Selling - Competing for Buyers in a Digital World

MH Advantage™, CHOICEHome™: Fannie Mae and Freddie Mac are making a big investment by creating exciting financing pro-

Having a good location, visible signage, and fur-

grams for manufactured homes. What are the MH

nished lot models are no longer enough to attract

Advantage and CHOICEHome programs? What do

today’s buyers. Retailers MUST learn to leverage new

they mean for the MH industry… and why should

technologies to attract buyers and sell homes. What

you be paying attention?

are those technologies, and how can every retailer employ them? This session explains it all. · Discover how prospects shopping habits have changed due to technology and the pandemic. · See demonstrated creative and effective use of technology – and how to use it.

· Understand what makes a home eligible for MH Advantage or CHOICEHome. · Find out how the programs can increase the scope of your business. · Determine how and when to use MH Advantage and CHOICEHome to close more sales.

· Learn why your website and social media is the launching point for every sale you make.

10:00 - 10:30 a.m. Sales Management 3.0: You Can’t Manage Sales Like It’s Sales Like It’s 1980 Closing more sales is the objective of every company. But without effective leadership in place, sales will

28 | MARCH / APRIL 2022 EDITION

Events

not happen to the degree they could and should. Sales Management describes effective, efficient, and

· Discover the best ways to connect with and close your community's future residents.

measurable actions that must take place to achieve optimum sales results. This interactive workshop will

10:00 - 10:50 a.m.

focus on the skills necessary for good sales managers

From Rent Collector to Sales Superstar - The En-

to become great sales leaders.

hanced Role of Community Managers

· E xamine the skills exhibited by all great sales managers – and how to cultivate them. · Learn what to measure and manage, and how to turn data into dollars.

Your property managers wear several different hats. Does the “sales hat” fit them? Selling, that is, filling your empty spaces, requires a different set of skills than managing property – skills that can be learned.

· D iscover the 10 most effective management

Find out what those skills are, how to instill them in

actions and how to turn your sales team into a

all your staff, and how to measure sales effectiveness

sales juggernaut.

in this enlightening presentation. · Why every member of your property staff are also

Manufactured Home Community Seminars Wednesday, March 30, 2022

· The Top 5 Skills required for effective selling.

9:00 - 9:50 a.m.

· H ow to transition from property manager

Connecting with the Next Generation of Communi-

in sales – and how to help them embrace that.

to sales professional.

ty Residents - They’re Not Just for Seniors Anymore The pandemic and ‘work from home’ phenomenon have prompted a mass exodus from the cities, putting

11:00 - 11:30 a.m. Developing With Non-Profit Organizations

the spotlight on MH homes and communities for a

Affordable Housing is a universal issue and a specific

whole new segment of residents. This ‘new generation’

focus of many non-profit organizations. And MH is

has different needs and priorities than their prede-

the solution more and more of these organizations are

cessors. Are you prepared to connect with, attract,

turning to. Are you tapping into this huge opportunity

and satisfy them? See the data and see for yourself

to increase your sales?

in this enlightening presentation. · Review new data on where and how your next residents are shopping for their home. · Learn the top features that new tenants are looking for.

· Why the Non-Profit community is embracing MH. · How a project in Mississippi’s Delta is gaining national attention – and what that means for you. · How to connect with NPs in your area that are eager to work with you. MHINSIDER.COM | 29

CADE

Events

Congress and Expo Features ‘The Neighborhood’ of New Homes, Keynote Panel with Top Builders

Manufactured housing professionals nationwide

have waited more than two long years for an oppor-

manufactured homes, outdoor seating, games, and daily activities.”

tunity to see new homes on display, and the 2022 Congress and Expo in Orlando — April 11-13 at Rosen

Riding the Wave

Shingle Creek resort — will provide that opportunity

The manufactured housing industry had a stellar

with “The Neighborhood”, sponsored by Clayton

year in 2021, and consumer demand continues to

and Skyline Champion. The small but impressive

surge. What does that mean for this year and the

collection of new homes will provide an outdoor

future of the industry? MHI has organized an open-

gathering area where the builders can show homes,

ing keynote panel moderated by Craftsman Homes

answer questions, and learn what community owner/

President and MHI Chairman Leo Poggione. He will

operators and retailers are looking to purchase.

be joined by leadership from the three top builders

“‘The Neighborhood’ is a new feature for the 2022

in the industry.

Congress & Expo,” MHI President Mark Bowersox said.

• Bill Boor, president and CEO of Cavco Industries

“It’s a nicely designed outdoor area to feature staged

• Kevin Clayton, CEO of Clayton Homes • Mark Yost, CEO of Skyline Champion Corporation

MHI 2022 Congress and Expo Schedule

Wednesday, April 13

Monday, April 11

8:00am — 10:45am: Registration Desk Open

9:00 a.m. — Noon: 4 th Annual Hart Kienle

8:00am — 10:45am: Expo Hall Open

Pentecost and Lutz Bobo & Telfair Clay Shoot 1:00 p.m.: 16th Annual Oliver Technologies Golf Open (separate registrations for Monday activities)

8:00am — 9:00am: Continental Breakfast with Exhibitors 8:30am — 9:30am: Educational Workshops (3 sessions) 9:00am — 10:45am: Morning Coffee in Expo Hall 9:45am — 10:45am: Closing General Session

Tuesday, April 12

10:45am: Expo Hall Closes

7:00am — 6:30pm: Registration Desk Open 8:00am — 4:00pm: Exhibitor Move-in 8:00am — 4:30pm: 2022 MHI-NCC Spring Forum 8:00am — 4:30pm: Developing with Manufactured Housing Seminar 4:00am — 5:00pm: Newcomers Networking Reception 5:00am — 6:30pm: Welcome Reception in Expo Hall

Venue Information Rosen Shingle Creek opened Sept. 9, 2006, and is one of the largest full-service convention hotels in Central Florida. The 255-acre luxury hotel offers 1,501 guest rooms and suites, and 524,000 square feet of meeting/event space. For more information about registration, sponsorships, and hotel accommodations reach out to events@mfghome.org. MHINSIDER.COM | 31

Community

Havenpark Spends $24 Million In Community Upgrades Utah-based Ownership Group Brings in 500 Affordable Housing Units by Sean Vichinsky

All photos courtesy of Havenpark Communites.

Havenpark Communities, an operator and developer

of manufactured home communities, completed $24 million in community upgrades during 2021. These strategic investments across its more than 80 properties delivered safe and reliable infrastructure, state-of-the-art community amenities, beautiful landscaping throughout, and overall enhanced curb appeal for an improved resident experience. New and upgraded amenities include: · Playgrounds · Dog parks · Sport courts · Picnic pavilions · Renovated clubhouses · Upgraded swimming pools

32 | MARCH / APRIL 2022 EDITION

In 2021, Havenpark also added more than 500 affordable housing units across its communities despite pandemic-related supply chain issues. Havenpark also announced it intends to invest an additional $35 million to continue revitalizing and upgrading its communities during 2022.

Commitment to Residents Havenpark’s commitment to its residents goes beyond physical upgrades into the communities. “Belonging to a caring community is so much more than just a place you live. It’s having friendly neighbors, courteous staff, and a neighborhood and home that you are proud to call your own,” Havenpark Communities co-founder and CEO Robbie Pratt said. “These community upgrades are part of our enduring commitment to our residents.” Havenpark’s approach to investment is changing the way people view manufactured home communities. “Every time we show government officials and planners our communities, they are amazed at how clean and desirable these neighborhoods are,” Havenpark Communities President Ramie Rajabi said. “They begin to realize what we have known for some time, that manufactured housing in well-managed communities is a real solution to the affordable housing crisis in America and that residents’ investments in their homes can be secured for the long term.” Exclusive relationships with home manufacturers have enabled Havenpark to deliver new manufactured homes with modern, energy-efficient designs for a fraction of what it would cost for a similar sized single-family home. “Most people who see our homes for the first time are astounded at how nice and affordable these homes really are,” Havenpark co-founder and Chairman J. Anthony Antonelli said. In recognizing the need to help Americans achieve the dream of homeownership during the current affordable housing crisis, Havenpark is planning to install more than 1,000 new affordable manufactured housing units throughout its communities in 2022. MHV Sean Vichinsk y is an editor of MHInsider and a marketing copywriter for MHVillage. MHINSIDER.COM | 33

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Community A resident at Far Horizons East, a Cal-Am Properties community in Tucson, Ariz., hits the links on a sunny day in January.

Top Community Amenities by Dawn Highhouse

MHInsider magazine posed the question to a diverse

group of community owners and operators, “What do you feel are the most important community amenities and why?” We received lists and detailed explanations on varying approaches to creating the best possible community assets for owners and residents from pet parks to RV parking and storage. Stephanie Martin Lamberson is in sales and marketing strategy for Sun Communities, and previously worked for Carefree Communities and Cove Communities. “From my experience, dog parks are one of the more affordable and popular community amenities we can offer. The cost to us is generally fairly inexpensive, in some cases we purchase pet equipment other than doggy bag stations, but generally we can utilize a lot or area of the community that wouldn’t normally be viable for placing a home because of slope or lot size, for instance,” Lamberson said. “We turn it into an amenity » MHINSIDER.COM | 35

Community

that most people in the community with a dog can

“Having well-rounded activities programs at our

utilize. I would say they are equally as popular in all

55+ properties is one of the best things we can offer

age and 55+ properties.”

our residents,” she said. “It keeps people active and

Another very popular and viable option is to create activities programs, she said.

excited, and gives them something to look forward to - whether it is a daily or weekly activity.”

“In our 55+ communities, these often are volun-

Other amenities Sun finds important to its commu-

teer-run. Some communities have a paid activities

nities include the community clubhouse, the fitness

staff, generally based on the size of the community,”

center, and the pool.

Lamberson said. “But most programs are run by

“Those features are built when we remodel or devel-

passionate volunteers who want to share their love for

op a property from the ground up and are generally

a card game, craft, social activity, or sport with others.

required to have in all of our new developments,” Lamberson said. “And recently, we have added pickleball courts, when feasible, mostly in active adult 55+ properties.” Steven Blank, of Blank Family Communities, pointed to the playground setup and a basketball court. “It adds a large draw for families,” Blank said. “It’s cost-efficient and adds to the aesthetics of the community. “Also, a clubhouse with space for parties legitimizes the community as much as a community pool, which can be heavy maintenance, but people like them,” he added. Jennifer Ludovice, vice president of public relations for Equity LifeStyle Properties said at ELS communities pickleball is a favorite amenity among residents, along with clubhouses as gathering spaces for social activities, swimming pools, fitness centers, and dog parks. “Woodworking seems to be a growing interest in

All-age properties should include a place for kids to play, such as the one pictured below. Photos courtesy of Equity LifeStyle Properties (above) and UMH Properties (below).

activities and crafting,” she said. ‘The opportunity for social interaction among residents is highly valued, whether in small craft or activity groups or gatherings for community-wide events.” Christine Lindsay is vice president of sales for UMH Properties. “I think having amenities helps set our communities apart from others in the area,” Lindsay said. “It also increases the value of the home selling price and rent price. Many of our residents choose our communities because of the amenities that we offer. Some low maintenance amenities that are great to have include:” • Dog parks • Community bicycles • Basketball courts

36 | MARCH / APRIL 2022 EDITION

piques or furthers the hobbies or interests of

• Fitness center

residents,” Horton said.

• Pavilion picnic/outdoor lounge area

But for every property decisions have to be made,

• Sports courts

she said, about what residents really want and what

• Playground

the market will support.

“Of course, swimming pools, hot tubs, and splash

“For instance, tennis is still a thing, too, even with all

pads are a huge plus, but do require ongoing main-

the emphasis now on pickleball,” Horton said. “And of

tenance,” Lindsay said.

course everyone should have pet areas. Walking trails

Her colleague, Ayal Dreifuss, is vice president of the

and paths are very important, too, and work well if you

rental division at UMH Properties. He said the value

have room for them. And the need for high-quality

a resident may derive from any community amenity

access wireless internet, most importantly for work

can be regarded in a pair of ways: For homeowners

and school, but also there should be a place where

and for renters.

residents who don’t have a computer can come sit and

“Of course, it’s always nice to have a swimming

contact family, do research, or read the news.” MHV

pool and a clubhouse in your community, and as

Dawn Highhouse has been in the

a selling point for homeowners it’s a great way to

manufactured housing industry for 22

show investment in the community. For renters, it’s

years and is the vice president of customer

not needed as much,” Dreifuss said. “I think most

experience at MHVillage.com. In her role,

renters are asking for a nice house in a safe neigh-

Dawn manages and implements strategic

borhood at a price they can afford… amenities would

customer service, product development,

just be something they appreciate, not something

and marketing initiatives.

they would typically ask for. “For a homeowner, I think all amenities, in general, are very important, even if you personally don’t use the swimming pool, for example, it’s always nice to look at and feels like it adds value to your personal investment,” he said. Vanessa Jasinski, of Yes Communities, concurred

Expertise in the area of Manufactured Housing Law in Delaware

with many of her colleagues in community operations

If you are thinking of purchasing or selling a community, or have questions running your community, please make us your first call.

and sales throughout the industry, endorsing playgrounds and indoor and outdoor common spaces for all-ages communities, and the clubhouse, pickleball courts and other activities at 55+ properties. However, there was one notable exception in the Yes Communities approach. “We are testing out a golf simulator at Holly Hills in Michigan,” Jaskinski said. “We have had requests

Nicole M. Faries

We are here to help you and we look forward to assisting you.

and heard that it would be great to have one in the clubhouse, and have created a specific place for it that’s still under construction. We think it’s a perfect addition for cold weather climates.” Maria Horton is the director of marketing and a regional manager for the Newport Pacific. “At some communities, like The Meadows in Irvine, there are craft rooms, a library, a machine shop, a styling salon, basically anything that

ATTORNEYS AT LAW

www.BMBde.com Wilmington | Dover | Lewes | Georgetown

302-327-1100 MHINSIDER.COM | 37

Community

• Walking trails

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Retail

Retail Sales in the South Continue to Expand by Sean Vichinsky

Clayton Home Centers in the South provide a

multi-state system of retail locations for a variety of homebuyer preferences and business throughout the Pandemic continues to grow in both the land and community segments. Eric Boehm, a regional vice president for Clayton Homes, oversees 29 home centers throughout Alabama, Mississippi, and the panhandle of Florida. “You have a lot of people who are looking to rural settings,” Boehm said. “There are a lot of places to go in Alabama, and Mississippi, especially, and still in the panhandle as well. “It all comes together and is a very viable option,” he said of the diverse offerings manufactured housing provides. “Our region’s community business has started to grow slightly, too,” the Clayton exec said. “Pools, »

MHINSIDER.COM | 39

Retail community centers, paved streets, people are looking for those types of amenities more often.”

Homebuyers Seek Open Space, High-End Finishes

Most customers are looking for hardwood or linoleum flooring

When it comes to floorplans,

throughout the home, with a

The business region-wide settles

buyers are looking for a home

small segment of buyers asking to

into thirds, land-home, land-

that flows and fits the needs of

upgrade to carpet in the bedroom.

in-lieu, and chattel. The region

their families.

has also seen an increase in all cash purchases. Boehm concedes that there are

“We are selling a lot of open

buying homes from us live out

floorplans with the kids’ rooms

in the country, they have dogs,

on one end of the home and a

many people hunt and fish,

pain points. “We’ve all waited on refrigerators and stoves, waited on windows, but you

“A lot of the people who are

they play sports,” he said.

Sourcing Homes in Alabama Nearly everything the Clayton Home

“Hard flooring is a lot easier to maintain.” DuraCraft cabinets come

roll with that,” Boehm said.

Centers sell in the three states comes

in each Clayton home and

“The morale is great; the

from homebuilding facilities in north

upgrades within that line

culture is strong. We have

Alabama. They sell Southern Homes

are among the other prima-

fantastic employees who

from Russellville, Tru from Hackleburg

ry options customers enjoy.

can really get things done.

and Lynn, Southern Estates, Southern

“DuraCraft has the look

“Customers have been

Energy from Addison, Buccaneer from

and feel of a very high-end

Hamilton and Epic from Addison.

cabinet,” he said. “But it’s

really good too,” he said. “They may love a smooth top stove or a cer tain

very light, very durable, and will last for years and years.

range hood, but they’ll take

primary suite tucked away on the

“If I’m the customer, I want to

a coil top or a similar hood if

other side of the home,” Boehm

know if I’m buying a home, that

you provide the overall positive

said. “These are floorplans that

it’s very energy efficient, too,” he

experience that they want. Each

are great for gatherings, and

added. “A lot of our customers

time they leave happy - we make

each one of our homes has an

were asking for additional energy

sure that happens.”

element of customization. The

features like digital thermostats,

list grows as you get into the

that can be controlled from any-

upper-end homes.”

where. A lot of people were asking

40 | MARCH / APRIL 2022 EDITION

worked really hard to fill on allo-

slow to develop, but the 29 Clayton

was loud and clear.”

cation what we need,” Boehm said.

home centers in the South, and throughout the country, remain

All Clayton Built® homes come

“There are some different fac-

with an ecobee smart thermostat.

tors, run rates, but we’ve been able

Additionally, Clayton Homes® in

to keep our customers supplied

“It’s taken some time to build

many markets offers an Ener-

with a product, keep them happy,

up that business, but it’s taking

gySmart® Home package, which

and keep the homes moving,” he

shape,” Boehm said. “There is a

includes a variety of energy effi-

said. “This is one of the most chal-

ton of interest and it evolves as

cient upgrades such as upgraded

lenging times I’ve been through,

we learn how to set the home and

insulation, low-E windows and a

don’t get me wrong. But the

build the on-site additions. MHV

dual element water heater.

problem is one we can deal with

“They are very efficient, and

when there is huge demand, and

it’s very residential,” Boehm said.

you know you can meet it. That’s

“Our customers come in and they

better than the opposite problem.”

committed to it.

really like what they see, it flows beautifully. You can be in the kitchen at the stove or sink and still be able to watch TV and keep an eye on the kids.”

The Steady Growth of CrossMod CrossMod, the HUD code home made for R1 residential developments and supported by lending

Home Choices and Settings The type of homes sales is nearly

programs offered through Fannie

FOR MORE INDUSTRY NEWS, VISIT OUR BLOG AT MHINSIDER.COM

Mae and Freddie Mac, have been

an even mix between single-section and multi-section, with multi-section homes tipping the scales just slightly. Boehm’s retail centers also sell some modular homes, but it’s predominantly HUD code. “It’s a very similar demographic from state to state in the region and down into the panhandle of Florida,” Boehm said. “There are some cost differences when you get down into the coastal regions for setup, largely because of wind

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zone requirements.” However, despite added costs for wind zone regulations, rising material costs, or the added time it may take to get a home, homebuyers in the region are undeterred, largely due to the increasing demand for affordable housing. “The time frames are reasonable because our building group has

RENTBUTTER.COM MHINSIDER.COM | 41

Retail

for energy efficient homes, and it

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KEN SCHEFLER Upper Midwest 323-393-0116 Ken@yaleadvisors.com

BRIAN MCDONALD Rocky Mountains 720-636-6551 Brian@yaleadvisors.com DAN COOK Pacific Southwest 305-771-3211 Dan@yaleadvisors.com

MAX HERNANDEZ Grand Canyon 415-686-8694 Max@yaleadvisors.com

JAMES MCCAUGHAN Midwest 305-588-5302 JMcCaughan@yaleadvisors.com DANA SMITH Southwest 303-323-5649 Dana@yaleadvisors.com

HARRISON BELL Mid-Atlantic 985-373-3472 Harrison@yaleadvisors.com

CHARLES CASTELLANO Southeast 305-978-0769 Charles@yaleadvisors.com

JAMES COOK Natl. Director of Brokerage 386-623-4623 James@yaleadvisors.com

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CHRIS SAN JOSE President of Lending 850-443-4580 Chris@yaleadvisors.com

GREG RAMSEY Vice President of Lending 904-864-3978 Greg@yaleadvisors.com

Land & Development

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MITCH GONZALEZ Land Sales & Development Director 734-447-6952 MGonzalez@yaleadvisors.com

CO N TAC T US FO R A FR EE VA L UAT I O N

Builder Photo Courtesy of Cavco Industries.

Top Builders Invest in North Carolina

A 37-minute drive on I-74 in North Carolina near

The two companies are leaders in manufactured

the South Carolina line connects a pair of home

housing, each with a large and growing presence

building facilities recently acquired by two of the

across the United States.

largest manufactured home builders in the country.

“In Pembroke we found a site that met our facility

Cavco Industries has agreed to acquire a 184,000

needs, had access to strong workforce assets and was

square-foot manufacturing facility in Hamlet, N.C.

capable of serving a growing regional housing mar-

that will be modified to produce HUD code homes.

ket. We are appreciative of North Carolina’s leaders

To the south, in Robeson County, Champion Homes

who were willing to work closely with Champion to

has confirmed it will begin operating out of a former

address our objectives for this expansion,” Champion

Fleetwood Homes facility with plans for more than

Homes Executive Vice President of Sales and Business

$13 million in upgrades.

Development Wade Lyall was quoted as saying in The Robesonian, a local news outlet.

44 | MARCH / APRIL 2022 EDITION

Cavco will begin re-tooling and renovations to allow

division of Skyline Champion Corporation, the largest

its homebuilding operation on the site to begin before

publicly traded manufactured home and modular

the end of the year.

builder in North America with approximately 8,100

“Demand for our homes, and affordable homes

people, nearly 70 years of homebuilding experience,

in general, continues to be very strong. With the

and 40 manufacturing facilities.

addition of this new facility, which will bring our

“On behalf of the Robeson County Board of Com-

total number of homebuilding production lines to 27,

missioners, it gives me great pleasure to welcome

we are expanding access to much-needed affordable

Champion Home as an industrial partner to Robeson

housing solutions and strengthening our position in

County,” Wixie Stephen, chairperson of the Robeson

the region,” Boor said. “This is a great opportunity to

County Board of Commissioners, state for the paper.

quickly bring new capacity online with an in-place

“This investment will provide a brighter future for

and capable workforce.”

citizens of Robeson County in both tax base and jobs.”

Cavco is headquartered in Phoenix and designs and produces factory-built housing products

Cavco Industries Converts Factory

primarily distributed through a network of inde-

Cavco President and CEO Bill Boor said the seller,

pendent and company-owned retailers. Its brands

Volumetric Building Companies, currently produces

include Cavco, Fleetwood, Palm Harbor, Nationwide,

multi-family residential and commercial projects

Fairmont, Friendship, Chariot Eagle, Destiny, Com-

in the facility but intends to move that production

modore, Colony, Pennwest, R-Anell, Manorwood

closer to their markets in the Northeast. VBC’s work

and MidCountry homes. MHV

will wind down during the summer, at which time

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MHINSIDER.COM | 45

Builder

Troy, Mich.-based Champion Home Builders is a

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BLACK PALM SIDING ENTERS THE MARKET by Suzanne Felber

48 | MARCH / APRIL 2022 EDITION

Builder

Smith & Fong Co., of San Francisco, has introduced

PalmShell™, a highly durable and sustainable palmwood cladding product for commercial and residential projects. Derived from the same Indian black palm resource as the company’s Durapalm interior products, PalmShell provides an entirely new, exciting look for modern exterior wall applications, and has found an immediate home in rainscreen systems. “PalmShell is a non-wood, all-natural cladding, the first of its kind in the Western market,” Smith & Fong founder and CEO Dan Smith said. “The material’s durability and capacity to adapt to moisture make it ideal for humid or wet climates.” The new cladding is made from solid palmwood with an easy-to-install groove/lap system — ideal for rainscreen or exterior cladding applications. Given its inherent weather-resistant quality, PalmShell can be installed and finished using standard exterior-grade clear finishes or natural products such as linseed oil for a raw natural look. “There are only a handful of woods that weather well outdoors, and there has been a growing demand for an exterior-use Durapalm product,” Smith said. “We are excited to launch this product and to enter the expanding market for rainscreen and exterior cladding materials.” Black palm is similar in density and hardness to Ipe and is harvested from both agricultural and residential environments. Frequently grown near homes and used for property demarcations, black palm timber, thatch, and fruit provide a wide range of uses and leave an indelible mark on rural India. Like other exotic woods, palm weathers over time, taking on a deep, rich patina. PalmShell groove/lap cladding is milled in 96” lengths with a 3 ¼” width and ¾” thickness. It is in stock next month; samples are available now. It is a sustainable natural material produced 100% urea-formaldehyde-free and can contribute to USGBC’s LEED® Credit for low-emitting materials. MHV MHINSIDER.COM | 49

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$2.1 billion in total enterprise value 127 communities, 24,000 homesites, 1 joint venture community containing 200 homesites, 11 states Housing approximately 21,000 families 7,000 total acres, 3,500 acres in Marcellus and Utica Shale regions

UMH Awarded 2021 Manufactured Home Community Operator of the Year and 2021 Retail Sales Center of the Year by the Manufactured Housing Institute For more information, visit www.umh.reit or contact ir@umh.com 50 | MARCH / APRIL 2022 EDITION

Lending

Tammac Makes Big Re-Entry to Industry by Patrick Revere

Tammac Holdings, a Wilke-Barre, Pa.-based

business that works in multiple industries and sectors, has made a strong re-entry to manufactured housing with a goal of providing $700 million in financing during the next three years. “We have a long history and are becoming more technically able for a full-spectrum offering across the manufactured housing community and dealer networks,” Tammac National Sales Manager George Ewing said. “We are now in 17 states and we’re adding nine states this year. We’re on the eastern seaboard and to Texas, which has been the focus of our growth, and we are going up into the Midwest as well.” »

MHINSIDER.COM | 51

Lending

The goal for 2022 is to provide

on lending and allow the portfolio

“A lion’s share of the customers

$100 m illion in f inancing,

to wind down taking a servicing

we get have enough information

doubling the figure each of the

approach solely. LL Funds bought

and engagement to allow us to

following two years. The 2023

the portfolio and started it up

provide a viable option,” she said.

goal of $200 million alone would

again,” Ewing said.

match 2005, Tammac’s best year lending in the industry.

In addition to Tammac, LL

Responding to the Market

Funds holds a dozen compa-

Tammac lends to individuals

“There is a need in every com-

nies, including Offerpad, a real

and institutional investors. It

munity for affordable housing

estate technology company that

looks at stability, ability, collateral,

we are committed to helping to

connects sellers and buyers that

and history.

ease,” Ewing said of the estimated

recently went public.

three million unit home shortage in the country.

New Investor Piques Industry Interest

and can easily quickly respond

ident of Lending for Tammac.

to the market,” Bowers said.

She has more than 25 years

“It’s aggressive but logically

in underwriting.

aggressive. We want to make an

“We want to see every appli-

Tammac has been in business

cation from an individual who

for 46 years and returns after a

has the intent and ability to buy

hiatus during and following the

a home,” Bowers said. “We’re

Great Recession.

looking to do as much of a home

“When the credit crisis hit the decision was made to pull back

“We are flexible and nimble

Christine Bowers is Vice Pres-

as they can afford.

impact on the community and help homebuyers.”

Opening New Headquarters A hundred miles to the southeast of Wilkes-Barre is King of Prussia, Pa., the location of Tammac’s new headquarters. It should be complete by summer. “We’re in the midst of really shaking things up and being an innovator in this industry. We will now have the right facilities to buttress that,” Ewing said. The “start-up” with 46 years’ experience appropriately will have an open office concept conducive to communication, and also a popcorn machine, snow cone maker, cornhole AKA “dummy game”, and the always appreciated, vending and snack spots. With that, one of Tammac’s mantras is “All in All the Time”. “We want to make sure that we can have some fun, and we want that to be in the air,” Ewing said. MHV

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Lending 54 | MARCH / APRIL 2022 EDITION

by Tony Petosa, Nick Bertino, Erik Edwards, and Matt Herskowitz

Editor’s Note: Wells Fargo Multifamily Capital offers MHInsider readers insight in a two-part series on current market dynamics and how multiple factors are likely to impact commercial lending for manufactured housing communities. Part I follows, and part II will be published in the May/June “State of the Industry” edition of MHInsider magazine.

We live in turbulent times with many cross-cur-

rents impacting the economy and commercial real estate. Unlike other recent economic cycles, white-hot inflation has moved into the headlines as the Federal Reserve Bank balances its dual mandates of price stability, moderate long-term interest rates, and full employment. The Consumer Price Index (CPI) is running at its highest level in four decades leading many to conclude inflation is no longer transitory. Treasury rates have been on a steady rise in 2022 with the 10-year Treasury yield eclipsing 2% in February, marking a two-year high and an approximate 150 basis point increase from the Treasury’s all-time low of 0.51% in August 2020. In order to help borrowers prepare to face a higher interest rate environment, this article will be »

MHINSIDER.COM | 55

Lending

Yesterday Once More

Lending

the first of a two-part series in which we take a look

would normally demand. Using a similar strategy

back at past economic cycles for insights, and then

in March 2020, the Fed injected more than $700

highlight alternatives borrowers should consider

billion in bond purchases, and in June 2020, it added

when assessing financing options and structures.

monthly purchases of $120 billion of bonds — $80 billion in U.S. Treasury securities and $40 billion in

Influence of the Fed The Fed influences short-term interest rates through its open market committee (FOMC), which sets the

mortgage-backed securities. That program continued until December 2021 when QE began being phased out.

federal funds rate — the interest rate applied on overnight loans from one financial institution to another.

Inflation in the U.S.

While they do not set market rates such as Treasury

The economy has rebounded following the sudden

yields, changes in the federal funds rate along with

and severe recession experienced during the first

the Fed’s policies and pronouncements are followed

half of 2020. The economy in 2021, as measured

closely by market participants, and market rates

by Gross Domestic Product, grew at an annualized rate of 5.7%, marking the fastest rate of growth in a calendar year since 1984. However, inflation

While many have been predicting materially higher interest rates for years, we now appear to be facing the possibility of rates above historical averages for the next several years.

picked up throughout the year and the CPI grew by 7%, the largest calendar-year change in the cost of living since 1981. At the end of January 2022, the 12-month inflation rate jumped to 7.5%. This resurgence of inflation appeared to force the Fed to reconsider its monetary policy and use of the term “transitory”. The Fed reduced its monthly $120 billion in bond purchases by half in December, and now plans to curtail the entire strategy by March 2022. Given all of this, it is worth re-visiting historic averages for perspective and insight into the years ahead. In statistics, regression toward the mean is the concept that extreme measurements or outliers in a defined group will be closer to the average over

along the yield curve respond accordingly. Besides

time. Outliers in economic statistics occur during

setting the much-followed fed funds rate, the FOMC

times of upheaval and then typically move closer to

also establishes Fed monetary policy which, in order

the average as more measurements are made. Because

to provide market stability, authorizes the Fed to

the 10-year Treasury is a common index used for

purchase securities (bonds). This is commonly known

fixed rate loans, we should consider the following:

as quantitative easing. Through QE the Fed buys

over the last 20-year and 30-year periods, the 10-

securities on the open market, providing a liquidity

year treasury yield has averaged 2.97% and 4.01%,

backstop and lowering the yield on bonds during

respectively. These periods include a low rate (outlier)

times of capital markets upheaval like that which

environment during the Great Recession and another

resulted from the COVID-19 outbreak in 2020. Many

during the COVID-19 pandemic. Inflation for decades

also will recall when the Fed utilized QE in 2009

had remained tame as the Fed prioritized maintaining

as financial markets muddled through the Great

a low inflation environment, and year-over-year CPI

Recession. QE aims to stimulate more lending and

increases averaged approximately 2.5% over the past

investment that keeps rates lower during times of

30 years. By managing inflation, the Fed was also

market disruption than what market participants 56 | MARCH / APRIL 2022 EDITION

persisting and oil prices spiking due to geopolitical

20-year history of the 10-year treasury yield.

threats, there appears to be no immediate relief in

However, during the six months ending January

sight for inflation.

2022, monthly CPI increases averaged 6.4% and they

Although we expect that over time there will be a

are increasing at an escalating rate. While many have

tightening in interest rate spreads that will offset some

been predicting materially higher interest rates for

of the increase in Treasury rates, we believe borrowers

years, we now appear to be facing the possibility of

should assess their current loans and borrowing

rates above historical averages for the next several

alternatives under the assumption that rates are going

years. Barring unforeseen capital market disruption

to be higher in the coming years. In part two of this

in the coming years, we expect a further increase in

series we will identify some key considerations to be

long-term fixed rates and related Treasury indices.

weighed when reviewing your current and future

Of the Fed’s mandates, price stability has been its top

financing strategies. MHV

priority in recent years. One reason for this may be

Tony Petosa, Nick Bertino, Erik Edwards, and Matt Her-

that the Fed is comprised of members who remember

skowitz are loan originators at Wells Fargo Multifamily

the years of high inflation and economic instability

Capital, specializing in providing financing for manufactured

experienced in the 1970s and early 1980s. Inflation is a

home communities through their direct Fannie Mae and

political liability that impacts fixed and lower-income

Freddie Mac lending programs and correspondent lending

households particularly hard, and we believe the Fed

relationships. If you would like to receive future newsletters

will be willing to slow the economy to rein in inflation

from them, or a copy of their Manufactured Home Com-

in a tight labor market. On top of increases in the

munity Financing Handbook, they can be reached at (760)

fed funds rate, the market also has to absorb the

438-2153 phone (Tony) or (760) 438-2692 (Nick); and email:

impact of the removal of QE. With supply chain issues

tpetosa@wellsfargo.com or nick.bertino@wellsfargo.com.

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(888) 594-5248 MHINSIDER.COM | 57

Lending

able to maintain price stability as shown below in the

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Western Manufactured Housing Communities

the interests of owners, operators, and developers

Association Executive Director Sheila Dey has re-

of manufactured home communities in California.

tired, closing out nearly three decades of service

WMA members collectively own, operate, and

at the end of February. “On behalf of California’s manufactured housing industry, we express our sincere appreciation for

control more than 175,000 mobile home spaces in California. WMA has more than 1,600 member parks located throughout the state.

Sheila’s outstanding contributions and achievements

Among her many accomplishments with WMA,

during her 29 years as executive director and general

Dey said one of the most notable successes was the

counsel for WMA,” Board President Candy Holcombe

development of the Utility Upgrade Program. The

said. “Sheila worked tirelessly to champion manu-

program is now a 10-year permanent California Public

factured housing as an affordable source of quality

Utilities Commission effort to

housing, all of which took on added importance

transfer master-metered parks

during California’s housing crisis.”

to direct service by serving

During her tenure, Dey received national

investor-owned utilities.

recognition by the manufactured housing

The WMA Utilities Task Force

industry for excellence in association management

undertook this effort in 1997

and communications.

and today it is a reality. MHV

“We are pleased to extend our gratitude to Sheila for her leadership and for developing WMA into a financially strong and successful organization,” Holcombe said. WMA’s Board of Directors has selected Doug John-

STAINLESS STEEL FASTENERS

NATIONWIDE SHIPPING

son, WMA’s senior regional representative, to serve as WMA’s executive director. He has been with the organization for 28 years. “After many years of representing the interests of mobile home park owners at the local level, Doug Johnson is prepared to lead WMA,” Holcombe said. “With Doug at the helm, WMA will continue to promote the interests of an industry that provides nearly 1.5 million Californians access to quality

Nappanee, IN 46550

Ph: 574-773-7993 ext. 1 Fax: 574-773-2132

and affordable housing.” Johnson recently worked on the successful passage of a Memorandum of Understanding in Sunnyvale, Calif., which will help keep mobile and

STEPS • DECKS

manufactured homes as an affordable housing option in Sunnyvale and serve as an alternative to a rent stabilization ordinance. Western Manufactured Housing Communities Association is a nonprofit trade association created

BUY DIRECT

in 1945 for the purpose of promoting and protecting MHINSIDER.COM | 59

Advocacy

Longtime WMA Executive Retires

Advocacy

MHInsider asked the directors from four state associations their thoughts on the status of manufactured housing where they do business, as well as input on the industry as a whole. Here is what manufactured housing advocates from Tennessee, Alabama, Florida, and Mississippi had to say.

60 | MARCH / APRIL 2022 EDITION

Advocacy

re there any initiatives at A the capital that are keeping your attention? Please detail what you're working on.

Lance Latham, Alabama

leaders in the business commu-

Manufactured Housing

nity to get that bill rewritten to

Association:

respect property rights for busi-

There are a handful of issues

nesses. As usual, there have been

that we have been focused on.

bills addressing storm shelters and

Marla McAfee, Tennessee

Most recent is the fact that Ala-

first-time-homebuyer tax credits

Housing Association:

bama is losing millions of dollars

that we have been talking with

On the state side, the Tennessee

in rental assistance because the

lawmakers about, as well as other

Housing Association (THA) intro-

state agency running the program

general business issues. We’ve

duced a financial amendment this

has been too slow. We are in talks

also been keeping an eye on an

session to address the duplicative

with the governor’s office to see

effort pushed by the trial lawyer

reporting requirements centered

what we can do to avoid losing

interests to make our industry a

around unique identifiers for

more money and improve the

bigger target for frivolous lawsuits.

all online consumer mortgage

speed of service. Another issue is

So far we have been successful in

applications submitted in Ten-

the state’s unemployment fund.

fighting those efforts, but it is a

nessee. This corrective language

COVID took a huge hit to that

fight that will not be going away

affects not only manufactured

fund, which in turn led to higher

anytime soon.

housing lenders, but all lending

taxes on businesses. Alabama was

institutions and mortgage com-

able to utilize some of our federal

James Ayotte, Florida

panies doing online mortgage

COVID relief dollars to replenish

Manufactured Housing

loan applications in Tennessee.

that fund, resulting in a 29%

Association:

The process to correct existing

tax cut for businesses, and our

FMHA has focused its attention

statutory language has taken the

association was a part of the team

on sales tax parity in the 2022

better part of seven months.

that got that done. A third issue

legislative session. In Florida, a

On the national side, the THA,

moving through the Legislature

manufactured home buyer pays

as with other associations, are

has been constitutional carry

sales tax on 100% of the purchase

collectively working to address

(i.e., eliminating conceal carry

price for both new and preowned

DOE’s proposed energy standards

permits for firearms). The original

homes. Legislation has been in-

for manufactured housing. Several

bill would have had the effect of

troduced to reduce sales tax on

of THA’s members are active par-

taking away a businesses right to

new manufactured homes from

ticipants in the national review.

restrict or limit firearms on their

6% to 3%, a 50% reduction. While

property. We joined with other

the industry has compelling » MHINSIDER.COM | 61

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Advocacy

arguments to support this tax

an economic impact analysis

package, but the Senate had not

policy change, the estimated

on the sales tax legislation. The

yet released its tax package. The

recurring tax reduction to state

study concluded that a one-half

Florida Legislature will adjourn

and local governments is more

reduction in sales tax on new

on March 11, 2022, and the fate of

than $17 million a year.

manufactured homes will:

the industry’s proposal will not

FMHA has presented the policy

• E x pa nd home ow ner sh ip

change as a parity issue and a way

opportunities for 39,573 addi-

to increase the number of afford-

tional Florida families.

be known until after the governor approves the budget. Jennifer Hall, Mississippi

able housing units. With respect to

• Increase manufactured home

sales tax parity, site-built homes,

sales by 1,844 units a year;

Manufactured Housing

and modular homes are assessed

generating $148 million in

Association:

sales tax on the cost of materials

additional sales.

There is a huge push to do

only, while manufactured home

• Create 2,178 new jobs account-

away with the state income tax

buyers pay sales tax on the cost of

ing for $70 million in wages.

in Mississippi. The House has their

materials, labor, and profit. The

• Increase Florida’s economic

version and the Senate has theirs.

current taxation of manufactured

activity by $185 million.

Initially the House version had

homes is unfair, and it has a dis-

• G enerate more than $13.7

the sales tax on manufactured

parate impact on lower-income

million in new state and

housing increasing from 3% to

local taxes.

5.5 %. MMHA spent most of the

home buyers. The Center for Economic Anal-

As of the writing of this article,

summer and fall testifying at

ysis and Forecasting (CEFA) at

The Florida House has included

public hearings and educating

Florida State University performed

the sales tax language in its tax

legislators that this would have

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64 | MARCH / APRIL 2022 EDITION

being able to purchase affordable housing. Thankfully, our concerns were heard and we were deleted from the tax increase in the House version. These two tax bills will over shadow the rest of the legislative session. There is also a push by the House to change our ballot initiative but it remains uncertain what the Senate will do with this issue. There is legislation moving through the process that would allow the

We have seen the Florida unemployment rate fall from a high of 14.2% in May 2020 to 4.4% at the end of 2021. That’s a significant improvement, but we are not back to normal.

use of American Rescue Plan Act

-James Ayotte

(ARPA) funds to establish infra-

Lance Latham: Workforce recruitment and development is the main priority of our association this year. We’ve created recruitment videos, have been connecting manufacturers with local career tech centers to find students who want to work in the construction industry and recruit them to work for us, and we have been using social media and digital advertising to promote working in this industry. In short, we have a master plan that focuses on both mass marketing as well as grassroots efforts to reach not just

structure grant programs under

those already in the workforce but

the departments of Health and

also those who will be entering the

Environmental Quality, respec-

workforce in the coming years.

tively. Upon passage, the bill would

some landlord tenant bills moving

We’ve also been having conversa-

allow the Dept. of Health to es-

through the session.

tions with our counterparts at the

tablish grant programs called the ARPA Rural Water Associations Infrastructure Grant Programs. These programs would assist rural water associations in the construction of eligible drinking

ow would you gauge H the state's workforce recovery as we continue to endure but ease out of the pandemic.

water infrastructure projects that were provided in the Final Rule for

Truckers Association to see what we can do to recruit and train more drivers so we can move the homes more quickly. Overall, Alabama’s workforce is tracking in line with the national trend: improving but

Marla McAfee:

still a lot more work to do. But

the Coronavirus State and Local

This is tough! All industries are

there are efforts going on by the

Fiscal Recovery Fund established

facing a workforce shortage, and

individual plants, as well as by our

by ARPA. The legislature is also

manufactured housing is certain-

association and the business com-

committing $300 million of the

ly no different. Today’s workers

munity as a whole to recruit more

federal funds received to roads

are slower to return to active

workers and obtain more state

and bridges around the state. Lo-

employment, despite the many

funding for workforce development

cal governments have submitted

hiring events and advertisements

and training.

their top priorities of roads and

for employment opportunities on

bridges that need to be repaired

social media and other career plat-

or new construction. This is very

forms, along with higher hourly

We are seeing progress, but it’s

important to our industry as some

wages and benefit offerings. Many

going to take time. At the onset

roads are in so much need of repair

state associations, including Ten-

of the pandemic, home building

that we can not travel on them to

nessee, have career pages linked

plants shut down or greatly

deliver our homes. MMHA has also

within our websites to encourage

reduced production, much like

been working with the realtors

individuals to take a deeper look

many other businesses did. We

and the apartment association on

at the varied career paths offered

have seen the Florida unemploy-

within manufactured housing.

ment rate fall from a high of »

James Ayotte:

MHINSIDER.COM | 65

Advocacy

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one training and five days of on

ernor did establish a department

end of 2021. That’s a significant

the job training by trainees. Each

under his office to specifically

improvement, but we are not

trainee that completes the class

address the workforce training

back to normal.

room training will then work with

needs in our state.

Florida homebuilders continue

a Mississippi licensed installer for

This department is working

to expand production in response

5 days. They will have 30 days to

closely with manufacturers in

to strong demand, but several

complete this on the job training.

the state and our community

factors are impacting the ability

MMHA is partnering with licensed

colleges to address these needs.

to grow further. First, COVID is

installers in the state to accom-

This will be a better way to over

still with us. It complicates pro-

plish the on the job training. We

see the work force training funds

duction planning when pockets of

are targeting existing professions

appropriated by the legislature.

employees are exposed or become

such as firemen, EMT associates,

ill, and must isolate. The sudden

and others for an opportunity for

absence of five or six workers can

a second career. MMHA is offering

slow down or halt an entire pro-

monetary incentives as well to

duction line. Supply chain issues

promote this training program.

I s there anything else going on that our readers should know?

Marla McAfee:

also delay home completions and

The restaurant industry was

likewise make it challenging to

hit hard in Mississippi and is still

The 2022 Elections will be a

predict staffing needs.

very slow to come back due to not

hot topic! Industry members and

The labor shortage is affecting

enough labor force. Many of our

affiliates should study legislators

every industry, not just MH

fast food restaurants are still drive

carefully. It is key to learn as much

construction. Many workers

through only. This year, the Gov-

as you can about the person who »

dropped out of the workforce entirely during the pandemic, and it remains to be seen how many of them will return. FMHA will continue to identify resources for its members, but this labor market will continue to be a

Discover the Credit Human difference

challenge. This is a long-term issue

Where we’re committed to:

for the industry.

Customer needs

Jennifer Hall:

Our purpose is to improve the lives of the people we serve.

Our one in-state manufacturer is still building up their work force and most of our retailers are doing well. The one area where we need more laborers is in the

Sensible choices

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installation of our homes. Many of our established installers are retiring and we are finding it

NMLS# 486243 Contact us at: MHinfo@CreditHuman.com

difficult to replace them. This is one of the retailers’ biggest concern across the state. MMHA is developing a training course

Federally Insured by NCUA

that will include a one-day class MHINSIDER.COM | 67

Advocacy

14.2% in May 2020 to 4.4% at the

Advocacy will represent you as a citizen, as

program that would offer our

munity). All of this, of course, is in

well as choosing candidates who

members more affordable workers

addition to the usual benefits we

will support the manufactured

comp insurance than what they

provide: political representation,

housing industry. Affordable

are currently paying. This project

industry marketing, educational

housing-friendly candidates

is currently in the research phase,

services, co-hosting the Biloxi

should state publicly their support

but our members will be hearing

Expo and Multi-State Convention,

for manufactured housing as a

more about it in the coming

and an assortment of other bene-

viable solution in addressing the

months. Also, new this year is our

fits all designed with one goal in

national housing crisis. Indus-

legal hotline. We have contracted

mind: to help our members make

try-friendly candidates will be key

with the Sasser & Sefton law firm

more money!

as we continue to break ground on

to provide each of our members

issues such as zoning, financial

with up to two hours of free legal

opportunities, advancements,

advice (this does not cover legal

FMHA recently launched a new

and acceptance.

issues going on between mem-

consumer website — MyFlorida-

bers; this is for those who need

ManufacturedHome.com. The

advice on how to handle issues

website and marketing platform is

Lance Latham:

James Ayotte:

We expect to have a very exciting

with customers or tenants or who

a collaboration between Manufac-

marketing announcement coming

need general advice on business

turedHomes.com and MHVillage.

in the next few months. Details

policy matters). We continue to

The goal is to create more sales

of that are being worked out as

offer our members a discounted

opportunities for FMHA members

we speak, but it will be a major

rate on supplies at Office Depot

by creating captivating content

promotion for our industry that

and will also be hosting in April

that showcases manufactured

will garner statewide attention.

our first AMHA golf tournament

home living in Florida, provides

Our association is constantly

to raise money for our Political

a unique and engaging online

working on providing new and

Action Committee (the arm of our

shopping experience, and attracts

better benefits for our members.

association that supports political

potential consumers to contribute

Currently, we are working on cre-

candidates who are allies to our

to and reinforce the industry’s

ating a workers comp insurance

industry and the business com-

desired brand and narrative.

68 | MARCH / APRIL 2022 EDITION

and emailed to retailers and sales

We are very excited about the

MMHA continues to increase

personnel monthly. MMHA has

expo and all it has to offer the

our digital marketing efforts lead

been very successful with our

attendees. It has been way too

by our outstanding Communica-

home owner promotions and cre-

long for our industry members

tion Director Lorie Hanson. Mrs.

ated some excellent testimonies

to get together and it will be like

Hanson uses Facebook, Insta-

by our home owners. The response

a manufactured housing family

gram, and Google Ads to promote

to these testimonies on our social

reunion. The expo not only of-

our messaging. Last year we had

media platforms has been over-

fers a golf tournament, exciting

2 million people engage and our

whelming. The important fact

welcome reception, informative

efforts generated 2,965 leads to

regarding these testimonies is

education sessions, outstanding

our retailers. We reached 9 million

that they are from the consumer…

exhibitors, but an opportunity to

people during our campaigns in

not scripted by MMHA.

win some great prizes. We hope to

2021 and 6 million played our

MMHA is very happy to partner

see many MHInsider readers in

videos for the year. We understand

with the Alabama Association

Biloxi, Miss. on March 28-30. MHV

that folks are on their phones and

and host the Biloxi Expo which

computers 24/7…so we need to

will be a grand opportunity to

continue our digital campaign

network with industry partners

efforts to promote our industry.

and leaders. The Expo is hosted by

MMHA leverages our platforms to

the South Central Manufactured

generate consumer leads for our

Housing Institute, which is made

retailers to pursue. These leads are

up of six members from each of

made available via our Dropbox

the two associations.

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Advocacy

MHI Keeps Manufactured Housing on the National Agenda by Dr. Lesli Gooch

Policymakers in Washington

Manufactured housing supply

can better support the purchase

are keenly focused on ways to

was a leading component of this

of manufactured homes.

address the nation’s affordable

effort, with White House Press

With current HUD Secretary

housing supply shortage. The need

Secretary Jen Psaki highlighting

Marcia Fudge pledging her sup-

for immediate solutions is only

the administration’s commit-

port of manufactured housing at

increasing — in 2021, home prices

ment to boosting the supply of

numerous congressional hear-

increased by more than 18% while

manufactured housing. Beyond

ings, saying it is an “outstanding

“real” average weekly earnings for

Washington, the plan included

option,” MHI’s efforts to educate

U.S. workers fell by more than 3%.

calling on state and local gov-

policymakers has positioned us to

With housing inventory at near

ernments to reduce zoning and

ensure federal efforts to increase

historic lows and economists

financing barriers to manufac-

the affordable housing supply in

estimating more than five mil-

tured housing which “allows

America will include changes in

lion homes are needed, finding

families to achieve homeowner-

policy that support manufactured

ways the federal government can

ship and build wealth.”

housing. In addition, to support by

help spur additional affordable

This is a historic time for our

administration officials, MHI has

housing supply is at the top of

industry when our efforts in

worked to ensure that the benefits

the agenda. The Manufactured

Washington continue to yield

of manufactured housing are a

Housing Institute is working to

attention at the highest levels

topic at every affordable housing

ensure manufactured housing

of government to help more

hearing that has taken place in

is well-positioned to be at the

Americans achieve homeown-

the 117th Congress.

forefront of these deliberations.

ership through manufactured

We are not just cultivating

Last September, the Biden-Har-

housing. As a result of the White

relationships with those con-

ris administration directed

House directive, an inter-agency

gressional representatives that

federal agencies to use “every

task force has been convened to

already know us. We are taking

tool available in government to

look at federal homeownership

our message about the quality

produce more affordable housing

financing programs and how they

and affordability of manufactured

supply as quickly as possible.” 72 | MARCH / APRIL 2022 EDITION

homes to congressional leaders,

Advocacy

including many who have never

ing are feasible and cost-effective;

efficiency rule; and administration

seen a manufactured home but

moving the federal government

efforts to address lumber prices

want more quality affordable

to address local exclusionary

and supply chain shortages. MHI

homeownership options in their

zoning policies and enforce the

is also developing partnerships

districts. Our efforts have yielded

preemption of the HUD Code; and

with key national housing and

results and through our advocacy,

supporting the preservation of

business coalitions to ensure

we have support from congres-

land-lease communities.

industry priorities are embraced

sional members on both sides of

In addition to our direct work

by the advocacy community so

the aisle and from all parts of the

with federal policymakers, MHI’s

that our voice to policymakers

country – saying at hearings that

membership has served as a key

is even stronger. Through these

manufactured housing is “the

grassroots connection to elected

relationships, MHI has participat-

most affordable homeownership

representatives and regulators.

ed in numerous housing industry

option available nationwide” and

Since the beginning of the 117th

events, including the National As-

“manufactured housing offers a

Congress and the Biden Admin-

sociation of Realtors® December

safe and affordable, wonderful,

istration, we have generated

“Real Estate Forecast Summit: The

place for a family to call home.”

more than 1,500 contacts to the

Year Ahead.”

Now is our time, and MHI is

administration and Congress. Our

MHI is continuing to build upon

seizing the opportunity to advance

advocacy has resulted in the first

our momentum from 2021 so

key priorities to grow the mar-

update to the FHA Title I program

that we can continue to elevate

ket, including ensuring federal

in 40 years; the first comprehen-

housing innovation and expand

housing finance programs (FHA,

sive updates to the HUD code in

attainable homeownership. We

Fannie Mae, Freddie Mac, USDA,

decades; the Senate telling HUD

will continue to build relation-

VA) support manufactured hous-

to expedite further updates to

ships with federal policymakers

ing; updating the HUD code on a

the HUD code and further FHA fi-

and ensure the manufactured

regular cadence; making sure ef-

nancing reforms; House members

housing industry continues to

forts to increase energy efficiency

telling the Department of Energy

be a part of the federal dialogue

standards for manufactured hous-

they do not support the proposed

about addressing our nation’s » MHINSIDER.COM | 73

Advocacy

housing challenges. Our access

opportunities. In addition, we

message, we will ensure federal

to Washington policymakers is as

are growing our resources for

policymakers support our indus-

strong as ever and it is bolstered

members, ranging from useful

try’s growth so that the American

by the direct engagement from

economic reports to interactive

Dream of homeownership can be

MHI members to their elected

maps on topics like zoning and

a reality for more Americans. MHV

representatives to keep our issues

manufactured housing communi-

Dr. Lesli Gooch

at the forefront.

ties, to timely news and updates.

is the CEO of the

In addition to advocacy, we are

MHI continues to gain momentum

Manufactured

committed to supporting our

in Washington, not only due to

Housing Institute,

members with quality events,

our effective advocacy strategy

the national trade

education, and information. Our

but because of what is happening

organization

upcoming in-person conferences

in the industry - the quality of our

representing all aspects of the

will be packed with exceptional

houses and our people. Together,

factory-built housing industries.

programming and networking

with a strong voice and unified

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THE EVOLUTION OF COMMUNITY APPRAISAL PART 2

Veteran manufactured housing professional George Allen in an MHInsider exclusive provides a review of manufactured housing community and land-lease property valuation approaches. The second in the two-part series focuses on the emergence of due diligence leading to sale. by George Allen, CPM Emeritus, MHM-Master

The first part of our series on land-lease community

valuation and appraisal focused on valuation methods, culminating in the mid-1990s with the current practice of using a cap rate to express value, and a description of how that number is derived. In part II, we welcome the entry of due diligence in the industry. During the mid- to late-1990s, it became commonplace for transaction due diligence to be formalized, concentrated on two separate and distinct areas: property operations accounting, via actual performance comparison with charts of accounts and OERs, as

76 | MARCH / APRIL 2022 EDITION

Allen Legacy

well as nature and condition of

income stream as rentals could be,

(or VCW) in 1994; an attempt to

property infrastructure. This was

they too carried heavy operational

combine the three traditional

an analysis of the underground

expenses. So, the calculation of

approaches to investment realty

or overhead utilities, sewer line

the value of those homes, and

valuation into a do-it-yourself

infiltration if any, water supply,

their respective income stream

worksheet. The VCW continues

age/condition of electrical service,

and expenses, became a separate

to enjoy some popularity among

and again, the degree and nature

accounting record and calculation

owners/operators of smaller

of functional obsolescence relative

in many if not most instances.

communities and is featured in

to homesites.

Over the decades there have

my book Swan Song.

been many instances of formulae

Finally, today’s valuation cli-

and unique methodologies sug-

mate is affected by an unusually

gested for land-lease community

strong sellers market trend, where

Rental homes on-site in manu-

valuation purposes. One was the

land-lease communities are

factured home communities had

Valuation Calculation Worksheet

concerned. As a result, cap rate

How Community Rental Homes Affected Valuation

been a common phenomenon during the 1970s and 80s. But when consolidation started in earnest among manufactured home communities, the rentals were routinely converted to contract sales, to ease the sale of properties. And this practice continued through the early REIT years (1994 - 2005) until the national economy tanked, leaving just about the only way to fill vacant rental homesites was via the acquisition of resale and new manufactured homes to be used as rental units. This complicated the community valuation process,

Pro te c t i n g Y Protecting Your our IInvestments nv e s t m e n t s

given the addition of the “parkowned homes” rental income to that of land-lease revenues. And how was that handled? At first, it was anyway one desired. However, over time it was realized that as lucrative an

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Allen Legacy

compression has become the valuation aberration of

valid for an average income-producing property. And

the day. There was a time when the cap rate percent-

why the New Rule of 72 moniker? Because the Original

ages 8, 10, and 12 pretty accurately pigeonholed A,

Rule of 72, used to calculate how long it takes to

B, and C quality grade communities. In some minor

double the value of one’s investment at a given rate

markets and among small communities (fewer than

of return, has been around forever — and no need to

100 rental homesites), that’s still the case. However,

confuse it with the New Rule of 72.

among the larger, institutional-grade investment

When I use the New Rule of 72 for a property, I

land-lease communities, expect to see cap rates that

run the numbers twice, the first time assuming all

once were fine at 7 and 8%, now compressed to 3-5%.

rental homesites are occupied and paid current, (an

Seriously. It’s that out of whack — for now.

estimate of the maximum potential value), then use actual number occupied and paid, to demonstrate

A Final Tidbit About a decade ago I stumbled on a unique and simple three step formula for estimating the in-

what the land-lease income stream is worth today. From there, you still need to add the value of any park-owned homes.

come value of an average land-lease community.

As was pointed out earlier, land-lease community

It’s simply this: The New Rule of 72: Multiply the

valuation has always been a niche specialty among

number of occupied and paid rental homesites

investment real estate appraisers. And back in the ear-

X rental rate X 72; for example 200 X 200 X 72 =

ly days, it was more in error than accurate…routinely

$2,880,000.00. The very same value as shown in the

undervaluing these properties. However, today the

earlier paragraph demonstrating the use of income

property type is widely accepted, even popular, and is

capitalization formula.

eagerly sought by investors, so valuation methodology

Here are two clarifying thoughts. First, this is only

78 | MARCH / APRIL 2022 EDITION

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WHY MHRE MHRE’s proprietary marketing platform strategically strives to ensure the highest probability of achieving our client’s objective. MHRE’s PROCESS starts with a Complimentary Broker Opinion of Value (BOV) of a community or portfolio, to determine its value and address all of the financial and physical characteristics that the valuation is predicated upon.

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