MHInsider™ March/April 2020 - Tunica Show/MHI Congress & Expo Edition

THE MAGAZINE FOR MANUFACTURED HOUSING PROFESSIONALS

A NEW ERA FOR MANUFACTURED HOUSING Manufactured Housing Institute’s CEO Dr. Lesli Gooch and President Mark Bowersox

TUNICA MANUFACTURED HOUSING SHOW MARCH 24 – 26 MHI CONGRESS & EXPO APRIL 6 – 8

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58 CONTENTS

A NEW ERA FOR MANUFACTURED HOUSING

HAPPENINGS 8 Industry Happenings EVENTS 12 The Louisville Show Roundup 14 HUD Uses Affordable Housing Bus Tour to Announce Major Changes 17 Plans for 2nd Annual Innovative Housing Showcase 18 Upcoming Industry Events TRENDS / INSIGHTS 20 Analytics Matter: Fundamental Metrics to Understanding Your Web Traffic 2020 TUNICA MANUFACTURED HOUSING SHOW GUIDE 26 Show Hours and Seminar Schedule 27 Manufacturer Exhibit Area Map 28 Service & Supplier Area Map STATE ADVOCACY 32 A Word from the State Execs SERVICE / SUPPLIER 38 Confessions of a Self-Described ‘Deal Junky’ 42 Let Some Light In

VOLUME 3 • ISSUE 2 MARCH / APRIL 2020 MHInsider.com Publisher Patrick Revere patrick@mhvillage.com

74 OCEAN BREEZE ON MARATHON KEY

BUILT FOR THE STRONGEST STORMS

Contributing Editor George Allen gfa7156@aol.com

Senior Graphic Designer Merit Kathan merit@mhvillage.com

Contributors Steven Blank Ken Corbin Kevan Enger Dr. Lesli Gooch Edward Hicks Matt Sterkenburg John Ace Underwood Josh Weston

Cover Image Photo courtesy of MHI

FINANCE 44 Greenfield vs. Brownfield Communities?

48 Triad Financial Services Offers Attractive New Financing BUILDER / RETAILER 52 College Visit Leads to New Business Plan, Affordable Home Builder MHI 2020 CONGRESS & EXPO 56 Event Highlights NATIONAL ADVOCACY 68 What it Means to be A Member in MHI 2.0 COMMUNITY 78 Low-Hanging Fruit – The Essentials of Operating a Manufactured Housing Community 82 Preparing & Positioning Your Park & Pocket for Rent Control SALES 86 Changing Our Image... and the Power of Retail 92 Simple Community Home Sales Tips THE ALLEN LEGACY 98 Do You Know MH Lingo?

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Disclaimer Although we made 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 Notice Copyright ©2020 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.

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FROM THE PUBLISHER

WHAT’S IN A NAME?

E

Early in life, I realized my fascination with language, with names of things, and where those names originate.

Language is much more than a spontaneous happening, it’s a process. And an emotional appeal of some sort, intended or otherwise.

So, what is in a name? What is in the word “home”? (Old English “ham”, as in hamlet)

So, wherever you walk along that path, wherever you labor or rest your head, ask yourself ‘What can I do from here that will bring us together?’

Without beleaguering etymology, home is a place we go for respite. Respite hopefully in a welcoming and healthy environment.

This is true for any home.

Being a Revere is something in which I’ve always found a certain pride. The word beyond the name means to trust and honor, which is always something I’ve tried to do. Paul Revere was neither an aristocrat nor a founding father, but he is a hero of the nation. He was a leader of the artisan masses. He was someone who could communicate for and represent the people.

6 | MARCH / APRIL 2020 • MHINSIDER.COM

The act of bringing together, the act of building community, is again, something I’ve focused on.

Our republic did not occur in a courtroom or by some transatlantic decree. The brave minds and strong backs that built this country did so in the workshops, storefronts, and village squares. They did so by decades of practice, building a common ideal and carrying it out.

It took time for the republic to take shape, and again for the states to be united. The process was a struggle, often painful even, but the results are glorious.

Industry is much the same. We build homes. We build language and culture. And we share that, more freely all the time, with others. Because we must. Because it’s the honorable act, and the act that will bear fruit.

This I know is true.

So, if you want to talk to me, wave me down or give me a call. I’m here for you. If I can help you, I will.

Since the inception of this magazine two years ago, we’ve asked for your contributions, either in language or in ideal.

What’s happening around you? What’s important and not being said? We want to say it.

Last year, as an industry, we were asked to come together with other homebuilders and home sellers and organizers of community to show the fruits of our labor on the National Mall, the U.S. Capitol rising above. This year, for the first time in the long history of the International Builder’s Show, we were invited and displayed a manufactured home in the outdoor Show Village.

Why? Because it was the right thing to do. It will bear fruit.

In this edition of The MHInsider, we bring together many topics, many people, many stories, many voices. We also bring together the detail of two iconic events, The Tunica Manufactured Housing Show and the Congress and Expo in Las Vegas.

The distance that separates Tunica, Miss., from Las Vegas is 1,592 miles.

Organizations and individuals along each mile of that path have the opportunity to contribute to change and progress in housing. These homes we build, we do so because we want to provide that place of respite in a welcoming and healthy environment. All of us.

So, wherever you walk along that path, wherever you labor or rest your head, ask yourself “What can I do from here that will bring us together?” That, too, will bear fruit.

With that, enjoy the read. Question what’s asserted. Ask why and why not. And tell me about it. I want to hear it all.

I am proud to be the publisher of this magazine and proud to be a part of this industry. I trust you feel the same.

Patrick Revere is associate vice president of publications for 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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INDUSTRY

Happenings Arkansas Association Names Annual Award Winners at Chairman’s Banquet The Arkansas Manufactured Housing Association at the Chairman’s Banquet named Clayton Homes of Savannah, Tenn., as the recipient of the Manufacturer of the Year award, A&R Mobile Home Services, of Cabot, Ark., as state industry Supplier of the Year, Hawks Homes of Conway, Ark., was named Retail Sales Center of the Year, and 2019 Factory Sales Representative of the Year went to Tom Gilbert of Cappaert Manufactured Housing in Vicksburg, Miss.

“The AMHA Achievement Awards recognize companies and individuals that have demonstrated dedicated service and unwavering support to the factory-built housing industry in Arkansas and to those Arkansas families that choose manufactured homes as their source of affordable home ownership,” AMHA Executive Director J.D. Harper said.

Clayton Homes Partners with Family Promise to Address Homelessness Fa m i ly P rom ise, a n ation a l non-profit, and Clayton Homes, one

The Warren family of Colorado Springs, Colo., cuts the ribbon on a new home through Family Promise and Clayton Homes. Photos Courtesy of Clayton.

of the nation’s leading home builders, have partnered for a program called A Future Begins at Home that seeks to prevent homelessness and stabilize families.

“Family Promise’s holistic approach to the crisis of family homelessness includes three key areas of focus: prevention, shelter, and stabilization,” said Claas Ehlers, CEO of Family Promise. “With Clayton, we are moving families from being homeless to homeowners – and helping them to create sustainable independence.”

Clayton has periodically gifted manufactured homes to Family Promise

HAPPENINGS

families as a permanent housing solution, the latest being the Warren family of Colorado Springs, Colo., in October 2019.

“It’s an honor to join Family Promise in this important partnership and further Clayton’s commitment to opening doors to a better life through attainable homeownership,” said Susan Brown, director of philanthropy for Clayton. “We believe that everyone deserves the opportunity to achieve homeownership and have a safe, secure home of their own.”

Maverick Commercial Mortgage Arranges $2 Million Loan for Middlefield MHC Maverick Commercial Mortgage has arranged a $2 million loan for the acquisition of Middlefield MHC, a 152-site manufactured housing community in Middlefield, Ohio.

Ben Kadish of Maverick arranged the 10-year, fixed-rate loan with a 30-year amortization schedule. A national lender provided the nonrecourse loan. Middlefield is owned by Park Place Communities, which owns or operates 35 manufactured housing communities in 13 states.

Manufactured Housing Properties Inc. Names Andrew D. Coatley as Chief Operating Officer Manufactured Housing Properties Inc., which acquires, owns, and operates manufactured housing communities, announced that Andrew D. Coatley joined the company as chief operating officer.

“We are very excited to have Andrew join our team, Andrew has extensive experience in real estate operation management and develop-

ment. Andrew has a proven record of successfully building and managing highly effective and motivated teams,” President and CFO Michael Z. Anise said. Coatley’s background is in due diligence, project management, and property operations, furthering the company’s ability to acquire and manage the portfolio.

Capital One Finances $7.7 Million Loan for Central Valley Manufactured Home Community Capital One provided a $7.7 million Fannie Mae loan for the acquisition of Almond Blossom Estates, a 139-unit, age-restricted manufactured housing community in Manteca, Calif., 75 miles east of San Francisco. Capital One Senior Vice President Damon Reed and Vice President Monica Schroeder originated the transaction.

The fixed-rate loan has a 12-year term with five years of interest-only payments followed by amortization on a 30-year schedule. Capital One closed the deal 75 days after the date of acceptance of the loan application in order to meet the seller’s timing.

The funds for the acquisition came from a refinance of another property the sponsor owned and Capital One closed in June 2019.

Hunt Real Estate Capital Provides $26.8 Million to Refinance Four Wisconsin Properties Hunt Real Estate Capital has provided four Freddie Mac Small Balance Loans to refinance a recently constructed four-property, 202-unit portfolio in Pleasant Prairie, Wisc.

The borrower and sponsor, Jeff Marlow, purchased the land for all

four Fountain Ridge properties in September of 2016 and construction was completed in 2018. All properties are fully occupied. Freddie Mac Small Balance Loans are structured with a 10-year, fixed-rate term with a 30-year amortization schedule.

The loans have a yield maintenance prepayment schedule (1% with the last 90 days open).

SG Realty Opens in Presque Isle, Maine SG Realty, a real estate agency and modular home seller, and a division of Schiavi Homes, opened in Presque Isle, Maine, in October. Presque Isle natives Dan Amero and Dan Castle serve as SG Realty’s designated broker/location manager and sales agent/planner, respectively.

SG Realty offers virtual tours and drone footage, allowing potential buyers to view homes anytime. “We serve all of Aroostook County,” Amero said.

“People won’t have to go to Bangor to learn about the process.”

Puyallup Mobile Home Park to Become Tiny Home Community Bridgeview Asset Management is converting a Puyallup, Ore., mobile park into a tiny home community. The intent is to build four 313 square-foot homes that are customizable. Each can include a loft, kitchen, and bathroom with hardwood floors. The starting price is $60,000, which includes a 30year lease of the lot space, and access to water and sewer hookup. There is an HOA with a monthly fee of $800.

Mobile homes already placed in the community will remain. »

MHINSIDER.COM • MARCH / APRIL 2020 | 9

HAPPENINGS

Manufactured Housing Community Planned South of Spartanburg, S.C. A new manufactured home community from AM Partners will include 196 manufactured homes priced between $50,000 and $100,000. City View Community will sit on a 48.5 acre site with two- to four-bedroom, two bath homes. “We’re going to offer quality, brand new homes,” developer Tim Mason said. Each home will be placed on a brick foundation in a landscaped community that has an open common area, a walking trail, and other amenities. Construction was scheduled for March, with the first phase of homes coming in the summer of 2020.

Andy Nemeth Named CEO of Patrick Industries Elkhart, Ind.-based Patrick Industries, Inc. President Andy Nemeth has been named chief executive officer, succeeding former CEO Todd Cleveland. Cleveland is now executive chairman and remains chairman of the board. Nemeth joined the company in 1996 and has held multiple executive roles, including vice president of finance and chief financial officer. Patrick Industries is a multi-faceted manufacturer and supplier for the recreational vehicle, marine, and manufactured housing industries.

RHP Properties Buys Chicago Area Community RHP Properties, the nation’s largest private owner and operator of manufactured home communities, has acquired Country Club Woods, located in Countryside, Ill. RHP now

10 | MARCH / APRIL 2020 • MHINSIDER.COM

operates 260 manufactured home communities nationwide.

UMH’s Memphis Blues Community Expands

The Carlyle Group bought Orange Brook Mobile Home Estates, a 344site, 24-acre mobile home park in Hollywood, Calif., for $25.2 million.

Carlyle Group is one of the world’s largest private equity firms with $212 billion in assets. Orange Brook caters to a 55+ lifestyle and borders the Orangebrook Golf and Country Club.

In November, UMH’s all-rental community Memphis Blues held the opening for phase two of its development, which adds 50 sites to the 37 homes that became available to rent in 2017. Three days after the opening, there was a waiting list for potential occupants. The community offers two and three-bedroom homes, with prices starting at $709 a month. In total, UMH plans for the neighborhood to have 150 homes.

Manufactured Housing Properties Acquires Spring Lake Manufactured Home Park

WCCRC Seeks to Replace Dilapidated Mobile Homes in Rural New York

Manufactured Housing Properties Inc., a community owner and operator, purchased Spring Lake MHC in November. The 225-pad property is located in Warner Robins, Ga., and was the company’s fourth acquisition during 2019. MHP now owns 13 communities and continues to expand its portfolio.

Western Catskills Community Revitalization Council, Inc. is seeking funds to replace dilapidated mobile and manufactured homes in Schoharie County, N.Y. The program is for homeowners of older mobile homes interested in replacement.

Eligibility will be based on household income, location, and the condition of the existing home.

Carlyle Group Expands Portfolio

MHVillage Promotes MHInsider Editor Gra nd R apid s , M ich .-ba sed MHVillage has named Content Director and MHInsider Executive Editor Patrick Revere to the role of Magazine Publisher and Associate Vice President of Publications for MHVillage. Revere joined MHVillage as a content marketing specialist in April of 2017. MHVillage is the leading online marketplace for manufactured and mobile home, and MHInsider is the premier industry source of manufactured housing news.

New Mobile Home Community in Crested Butte, CO The Crested Butte Town Council and Gunnison Valley Housing Fund have begun the joint application process for a six-unit mobile home cluster located at 114 Butte Avenue.

The homes will be 500-square-foot one-bedroom manufactured homes and offered as rentals to locals.

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EVENTS

The Louisville Show

T

Roundup

he Louisville Manufactured Housing Show enjoyed one of its best years in recent history with 3,536 attendees coming together for three days in January

at The Kentucky Exposition Center. In addition to the 53 new models homes on display, there were 1,132 companies represented, including the robust collection of service and supply exhibitors. The hall was packed for The Louisville Show’s education seminars. Sen. Todd Young of Indiana stopped in to talk with industry professionals, and toured some of the homes. “I think everybody would agree that this year’s show was a success,” Dennis Hill, of Show Ways Unlimited, said. “The degree of enthusiasm was most rewarding. We are looking forward to the 2021 show.” MHV

EVENTS

HUD Uses Affordable Housing Bus Tour to Announce Major Changes

By Patrick Revere

Alabama Gov. Kay Ivey greets HUD Secretary Ben Carson during the "Driving Affordable Housing Across America" bus tour on its stop in Russellville, Ala. Photos courtesy of Clayton.

T

he U.S. Department of Housing and Urban Development Secretary Ben Carson took to the road in late January and February to tour home building facilities, and to talk with locals who need access to better affordable housing.

HUD’s “Driving Affordable Housing Across America” is a multi-city bus tour that will run through the spring of 2020. In addition to touring the facility, Secretary Carson took questions during an employee town hall.

The bus tour kicked off in Louisville, Ky., made a stop in Nashville, Tenn., and toured a Clayton Homes factory,

14 | MARCH / APRIL 2020 • MHINSIDER.COM

talking with manufactured housing industry professionals in Russellville, Ala. “This first leg is through the great American south, and the real focus of the travel has been to meet with local government officials and looking at how we can work together to reduce a lot of the regulatory barriers that are driving up the cost of housing,” Carson said to an audience of hundreds in Russellville. “I was delighted to be here this morning and to be able to look at the incredible development that’s been going on with manufactured housing.

“A lot of people… they have no idea what’s happening in this industry,” he said.

EVENTS

The Progress Being Made in Affordable Housing Manufactured Housing Institute CEO Lesli Gooch joined the Clayton Homes and HUD teams for the tour.

“We’re honored that Secretary Carson and the HUD team chose a manufactured housing facility for one of the first stops on the tour,” Gooch said. “It’s an excellent example of the department’s commitment to elevating manufactured housing’s role in affordable housing.”

Among the many changes in direction and policy to arise from HUD in recent years, the bus tour announcements have particular appeal to the manufactured housing industry.

“Policies that exclude manufactured housing development prevent affordable alternatives to traditional stick-built housing, and that’s not a good thing,” Carson said.

For more than two years, MHI has been providing policy insight and suggestions for the Manufactured Housing Consensus Committee, and much of that new language is now under review and up for consideration in a revised HUD code.

“When finalized, these proposed changes will be the first major updates to the standards in over a decade,” Carson said. “These changes will reduce regulatory burdens for manufacturers while maintaining high levels of quality and safety for the consumer.”

“I think these things will help to accelerate the use of manufactured housing across the nation,” Carson said.

Another change proposed by HUD covers regulatory requirements for the use of materials that contain formaldehyde.

“This final rule eliminates overlap in the regulation of wood products that contain formaldehyde so that manufacturers don’t have to comply with multiple regulations that all try to get to the same goal,” Carson said. “It also eliminates the regulatory burden on manufacturers of providing a formaldehyde notice creating a more level playing field with stick-built housing.”

Carson pointed to four key improvements to the code: 1. Eliminates the need for manufacturers to obtain alternative construction approvals from HUD when they install certain modern design features not covered in the current building code, including garages and carports.

2. Includes requirements for carbon monoxide detectors that will increase health and safety while eliminating the need for manufacturers to comply with state-based requirements.

3. Implements standards that allow for more optimal use of manufactured housing in urban areas, including opportunity zones.

4. Updates reference standards that will increase design flexibility, and aligns federal standards with industry practices.

Secretary Carson, left, gets a tour of Clayton’s Russellville plant.

Clayton CEO Kevin Clayton is seated at center.

The Affordable Housing Crisis Kevin Clayton, the CEO for Clayton, introduced Secretary Carson for his talk in Russellville. His words echo what many industry professionals have been thinking about the reinvigorated enthusiasm for factory-built housing.

“He is the hardest working secretary we have ever seen,” Clayton said of Carson. “And he has absolutely made manufactured housing a centerpiece of his housing strategy across America. He’s spoke very highly of this industry for »

MHINSIDER.COM • MARCH / APRIL 2020 | 15

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his entire term serving as secretary, and we are so very grateful for that.”

And Carson was just as complimentary of the hard work industry professionals have initiated.

“I was immediately in awe of the hard work that’s being done here, and it really all goes to make the American Dream a reality for so many people,” Carson said.

He noted that in many U.S. markets the average home price is approaching or exceeding $300,000.

“What young couple can afford that?” he asked “And yet we look at the model you guys built here in two weeks, and it’s absolutely gorgeous, beautiful. And you know it provides an opportunity for that young couple to be able to afford something that builds equity for them,” he said.

“And, they don’t need to live in their grandmother’s basement.”

Manufactured housing makes up about 10% of annual housing starts each year, and is home to more than 22 million Americans.

“It’s a big part of housing,” Carson said of the industry. “Manufactured housing also plays an important part in the wider economy, employing in excess of 40,00 people, and when you look at suppliers to manufactured housing you really get into hundreds of thousands of people.”

Keeping the manufactured housing construction code up to date is critical for ensuring the industry can efficiently produce homes with innovative features and amenities consumers want.

“We want to clear the path for you to help our own communities reach their highest potential,” Carson said in closing. “When we put politics aside and work together to do what’s right we can deliver truly life-changing results for the people.” MHV

EVENTS

Passers-by on the National Mall take a look at one of three manufactured homes set up in D.C. during the 2019 Innovative Housing Showcase.

Plans for 2nd Annual Innovative Housing Showcase

By Patrick Revere

T

he U.S. Department of Housing and Urban Development will host the 2nd Annual Innovative Housing Showcase on Sept. 12-14 on the National Mall in Washington, D.C. HUD Secretary Ben Carson announced the dates for the 2020 public event during the International Builder’s Show in Las Vegas.

The Innovative Housing Showcase is a large, public display of innovative designs, structures, and advances in housing, particularly toward energy-efficiency, durability, and affordability.

Manufactured Housing at the Innovative Housing Showcase Last year, the Manufactured Housing Institute and Skyline Champion Corporation, UMH Properties, and Cavco Industries teamed to set up a trio of manufactured homes on the National Mall.

“An average of 1,000 people per day toured the homes over the five-day period, including administration officials,

members of Congress, and the general public,” MHI noted in a statement following Carson’s announcement. “With these homes on display, policymakers and the public saw with their own eyes that today’s modern manufactured homes are indistinguishable from site-built homes and about half the cost per square foot.”

In 2020, innovative builders again will host law and policymakers through the week, as well as manufactured housing professionals who invest in and plan out affordable, safe, and healthy places to live.

Manufactured Housing Industry Professional News MHInsider will continue to track details for the 2nd Annual Innovative Housing Showcase. Check back for updates on exhibiting, registering, speaker agenda, and hotel accommodations. As part of the effort to keep up on news for manufactured housing professionals, MHInsider maintains a list of manufactured housing industry trade shows, conferences, and events. MHV MHINSIDER.COM • MARCH / APRIL 2020 | 17

upcoming INDUSTRY EVENTS The 2020 Tunica Show March 24-26 Tunica, Miss. — Hollywood Casino The Southeast’s premier event for manufactured housing professionals.

As the largest outdoor manufactured housing show in the nation, the Tunica Show captures the attention of the manufactured housing industry as few events can.

IMHA Annual Conference & Member Meeting April 22-23 Oak Brook, Ill. — The Drake Hotel The Illinois Manufactured Housing Association invites members for legislative and regulatory updates, networking, and educational programming to help grow your business and sell more homes.

2020 MHI Congress & Expo April 6-8 Las Vegas, Nev. — MGM Grand The national trade show where you can obtain the knowledge and resources necessary to excel in today’s housing marketplace. Choose from attending top quality educational programs with powerful speakers, networking with the industry’s most successful professionals, developing new ideas for your business, and visiting the exhibit floor to see the latest and greatest products and technologies.

Pennsylvania Manufactured Housing Association Retailer Symposium June 10 State College, Pa. — Wyndham Garden This one-day event tied to the annual PMH PAC Golf outing on June 11 provides education, networking, and exhibitor booths geared to retailers and their sales teams.

18 | MARCH / APRIL 2020 • MHINSIDER.COM

2020 Multi-State Convention July 25-27 Orange Beach, Ala. — Perdido Beach Resort Join the Alabama, Louisiana, and Mississippi MH associations for an exciting convention that includes networking receptions, a banquet, educational speakers, and entertainment in a resort setting.

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MHI NCC Western Summit August dates and venue TBD This second annual event in the western U.S. features education, networking, and exhibitor booths geared to community managers and smaller owner/operators. Join others within the industry for three days of community insights, educational workshops, ongoing engagement, and a local plant tour.

2020 Georgia Manufactured Housing Association Annual Convention Aug. 18-20 Jekyll Island, Ga. — The Westin Jekyll Island The GMHA will open its annual gathering with an introduction and keynote speaker. The convention also will include a silent auction, golf tournament, banquet, entertainment, and professional networking.

MH FacTOURy Summit 2020 Aug. 4-5 Elkhart, Ind. — RV/MH Hall of Fame Two days of factory tours and educational workshops. Retailers, community owner/operators, and vendors from around the nation will have the chance to come together to learn the latest trends in community operation, management, finance, sales, and products.

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TRENDS / INSIGHT

Sure, you can make changes to your website, run new campaigns, continue creating content, but if done blindly the success of your efforts will be limited.

20 | MARCH / APRIL 2020 • MHINSIDER.COM

TRENDS / INSIGHT

Analytics Matter: Fundamental Metrics to Understanding Your Web Traffic

By Matt Sterkenburg

T

he importance of having a dedicated digital marketing program is pretty well understood today by most organizations. Many companies realize the value that a well-optimized website and online presence have as a modern sales tool.

However, it is worth a reminder that the biggest advantage digital marketing can offer a business is measurement. The ability to track, monitor, and evaluate the performance of any effort is what allows you to eliminate as much guesswork in

your operation as possible. From a marketing perspective, a large part of this is getting to know your customers on a deep level.

This means understanding what their needs are, where they spend their time, what topics resonate with them, and how they interact with your brand. To strategically invest your time and money in the right areas, you need to know what’s working, what’s not, and why.

This is where web analytics comes in. »

MHINSIDER.COM • MARCH / APRIL 2020 | 21

TRENDS / INSIGHT

What Are Web Analytics?

Web analytics can seem overwhelming for anyone who is unfamiliar with the terminology, metrics, or what to look for in the marketing results. The sheer amount of available information can feel like a massive sea of data points that you’re unsure about jumping into.

However, when you can make sense of it, the data will help you better understand your web traffic and gain deeper insights into what your customers care about.

Quick Tip: When choosing an analytics tool for your business, go with Google Analytics. Google Analytics is the industry standard for web measurement platforms. It’s a highly capable and effective tool that’s free for all businesses.

Regardless of company, it is the best solution. There are dozens of excellent, free resources readily available to help users learn more about the platform at any level.

But before you spend too much time looking in your analytics account and drawing conclusions, it’s crucial that you begin with a correct understanding of what these numbers represent and how they differ from one another.

Let’s start by defining a handful of basic, but fundamental metrics for measuring web traffic.

• Sessions • Users • Pageviews

Sessions

Any time a new person lands on your site, Google Analytics assigns them a unique ID that gets stored in a cookie in their web browser (like Google Chrome). When they return to your site using the same browser and device, they are recognized as a returning visitor.

It’s important to know that users are tracked separately on different devices. So if the same person visited your site on a desktop and smartphone, these each would be tallied as a new user.

Users are an optimal way to measure unique web traffic.

However, like most things in digital marketing, a single metric only offers so much intel when analyzed by itself.

Users are helpful for understanding how many people visited your site in a given time period, but it’s best to look at users alongside of sessions, pageviews, and other engagement metrics to really get a sense of the biggest factors driving your traffic.

Pageviews More straightforward than the above metrics, a pageview is counted every time a page on your website is viewed, as you may have guessed. If someone lands on the homepage, goes to the About page, Contact page, then back to Home, that’s four views. If they reloaded the About page five times, it’s counted as five pageviews. Pageviews are counted very generously in analytics and will always be much higher than both users and sessions.

When looking at sessions, think total visits, not people.

Every time someone visits your website a session begins.

It starts immediately when the first page loads and ends after there has been 30 minutes of inactivity.

If a user leaves your site, then returns again one hour later, a new session begins. One person can log multiple sessions on a website, so it is common for sessions to be significantly greater than users when looking at analytics.

Sessions are a useful metric for understanding how your website traffic is changing from month to month, or during key periods throughout the year. When you have marketing campaigns running at certain times, sessions can help you evaluate how these efforts are impacting traffic.

Hits

Users

Platform Comparisons: Google Analytics vs Webalizer vs AWStats

When looking at users, think individual people, not visits.

Users refer to the number of new and returning visitors to a website. It’s best to think of users as individual people, but there are a few nuances.

22 | MARCH / APRIL 2020 • MHINSIDER.COM

To be honest, there won’t ever be much to infer with hits as a metric for traffic. Hits are irrelevant for measuring web traffic, primarily because there are just too many actions, often repetitive or misleading actions, that get tracked as a hit. Naturally, some marketers will reach for the biggest number and opt to showcase hits as a measure of site visits or users, but this is a hasty and inflated representation of actual traffic. Equating hits to a metric like sessions is misguided and ill-advised. Hits always will be much greater in volume than users, sessions, or pageviews.

Hits may be a good measure of overall server usage, but it doesn’t tell you much about your audience.

If you have yet to adopt a traffic measurement tool, there are several platforms for your business to consider. As mentioned, Google Analytics is by far the most widely

TRENDS / INSIGHT

used tool today, and we recommend it against a few others for key reasons.

Alternative analytics platforms like Webalizer and AWStats are known to overestimate traffic data and report inflated numbers. This is because these programs collect data differently than Google Analytics.

Webalizer and AWStats are “Server-side” analytics platforms, meaning they gather data from a website’s server logs to report traffic. Instead of only showing activity from actual human visitors, the data contained in these log files includes activity from both humans and bots. The server responds to human visitors, but also to automated requests

made by bots. These requests can include anything like image files, graphics, audio files, and HTML pages.

This significantly skews the data and thus shows much higher numbers than the more refined results from Google Analytics.

Overall, platforms like Webalizer lack cookies to recognize real, unique visitors, so they use data from server logs to give it’s best guess at how many actual people visited the site. Server-side collection is an inferior way to measure website traffic, especially for any sites that receive a sizable volume. »

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Getting Onboard with Analytics

Together, we build the confidence that sells homes.

You Build It, We’ll Back You Up.

In this article, we really just scratch the surface of what is possible with web analytics. If all of this sounds new or vaguely familiar to you, it’s a topic worthy of further investigation. Strengthening your knowledge of analytics will always help in uncovering new insights about your customer, how they shop, and how they buy.

Without a professional analytics program, you won’t truly have the information you need to adapt your marketing strategy. Sure, you can make changes to your website, run new campaigns, continue creating content, but if done blindly the success of your efforts will be limited. MHV Matt Sterkenburg is the senior digital strategist at MHVillage, working in the areas of SEO strategy, content strategy, and paid advertising. He previously worked as general manager at a

Ron D’Ambra National Manufactured Modular Program Manager

marketing agency overseeing client strategy and managing day-to-day business operations.

Sterkenburg is a regular contributor to the MHVillage blogs.

803.917.1946 rodambra@2-10.com

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2020 SHOW SPONSORS at time of print

8am - 11am................................................................Pre-Show Seminars 9am - 10am.................................Sponsored Breakfast for Suppliers 11am - 5pm.......................................................EXHIBITS OPEN

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Silver Sponsors Blevins, Inc. Cappaert Manufactured Housing Cavco Industries

Deer Valley Home Builders, Inc. Franklin Structures, LLC Lonestar Wheel Components N. Tech Industries, LLC Northpoint Commercial Finance Oliver Technologies

8am.............................................................................. Registration Opens 9am..................................................................Bloody Mary Mixer in the Service & Supplier Exhibit Area 9am - 5pm....................................................... EXHIBITS OPEN 11am - 1:30pm....................................SCMHI’s Hospitality Luncheon in the Hollywood Buffet Area

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Thursday, March 26

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9am - 1pm........................................................ EXHIBITS OPEN

Senco Brands Shaw Floors Style Crest, Inc. Superior Axle, LLC Triad Financial Services UFP Distribution, LLC

2020 SEMINAR SCHEDULE Tuesday, March 24 8am - 8:45am.........................................................State of the Industry

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MARCH 24-26

GUESTS ENTRANCE

TO RESTROOMS & MAIN HOTEL LOBBY

ENTRANCE

AMHA MMHA

ENTRANCE

REGISTRATION

82 83 84 85 86 87 88 89

55 56 57 58 59 60 61 62 63 64 65 76 75 74 73 72 71 70 69 68 67 66

38 39 40 41 42 43 44 51 50 49 48 47 46 45

5

9 10 11 12

35 36 37 54 53 52

4

8

17 18 19 20 21 22 23 30 29 28 27 26 25 24

3

7

13 14 15 16 34 33 32 31

2

77 78 79 80 81

1

6

SERVICE & SUPPLIER AREA MAP

Next Step Network........................................................ 36 Nortek Global HVAC......................................................12 Northpoint Commercial Finance................................ 17 Novik................................................................................. 63 Oliver Technologies, Inc.................................. 30, 31, 32 Panel Processing, Inc.................................................... 27 R-Co Products Corporation......................................... 39 Remote Trax.......................................... Outside Display Rustique Enterprises, Inc............................................. 58 Senco Brands, Inc....................................................19, 20 Shaw Floors..................................................................... 38 Strong Skirt........................................................ 66, 67, 68 StyleCrest, Inc...............................................................6, 7 TAG Lending........................................Across from 2-10 Tie Down Engineering.......................................... 53, 54 Translift Sales & Service, Inc............. Outside Display Triad Financial Services, Inc....................................9, 10 Tri-State Distribution, Inc.......................................75, 76 UFP Distribution, LLC......................................49, 50, 51 VMF Homes............................................................. 24, 25 Water Systems, Inc........................................................64

eLend......................................................Across from 2-10 Everlock Systems........................................................... 33 First Bank...................................................................61, 62 First Federal Bank.......................................................... 26 Gama Sonic Solar Lighting......................................... 34 Go Mortgage............................................................ 40, 41 Heritage Distributing, LLC.......................................... 35 HMH Supply.................................................................... 72 HomeCarePlus................................................................29 LearnMH........................................................................... 87 LoneStar Wheel Components, Inc............................ 28 Louisiana Pacific Building Products...........................11 Manufacturedhomes.com............................. 87, 88, 89 Manufacturedhome.loan...................................... 82, 83 MH Manager................................................................... 43 MHCRM............................................................................84 MHVillage/Datacomp............................................73, 74 MHWC.................................................................................3 Minute Man Anchors, Inc............................................48 Modularhomes.com...............................................85, 86 N. Tech Industries, LLC................................................. 52 Newport Pacific............................................................... 13

2-10 Home Buyers Warranty...........end of booths 35 & 54

21st Mortgage Corporation............................ 77, 78, 79

A & G Commercial Trucking / Transco Express.....65

American Insurance Alliance, LLC..............................14

American Modern Insurance Group........................... 8

Atlas Molded Products..................................................16

Baymont, Inc.......................................................21, 22, 23

Bennett Truck Transport, LLC....................................69

Blevins, Inc......................................................... 55, 56, 57

CANA Cabinetry......................................................46, 47

Cascade Financial Services...................................70, 71

CIS Home Loans, Inc..................................................4, 5

Cordell International, Inc........................................80, 81

Country Place Mortgage.............................................. 37

Credit Human Federal Credit Union..................59, 60

Croft, LLC..........................................................................18

CrossCountry Mortgage...............................................44

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STATE ADVOCAC Y

»A WORD FROM THE STATE EXECS MHInsider asked the directors from four state associations across the country 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 Alabama, Arizona, Florida, and Texas had to say.

DEPUTY EXECUTIVE DIRECTOR LANCE LATHAM

PRESIDENT KEN ANDERSON

EXECUTIVE DIRECTOR JIM AYOTTE

EXECUTIVE DIRECTOR D.J. PENDLETON

STATE ADVOCAC Y

»1

hat industry changes in W your state require the most amount of your attention on a daily basis?

Florida Manufactured Housing Association Executive Director Jim Ayotte: We are spending more time dealing with new local government regulations. While Florida has done a good job preempting most industry regulation to the state, local governments are continually adopting discriminatory land use ordinances and regulations that make it expensive, if not impossible, to replace homes and redevelop older mobile home parks and manufactured housing communities. In 2019, the FMHA Board of Directors approved a local government strategy to challenge local government overreach.

This strategy was effective in 2019 and will continue in 2020.

Alabama Manufactured Housing Association Deputy Executive Director Lance Latham: Much of the work we do is promoting the industry to the public through our social media and digital advertising campaigns.

Our focus in those campaigns is in showing just how much our homes have changed and improved over the years. We spend a lot of time talking with homeowners and potential homeowners – especially through our social media platforms – about the changes in quality, efficiency, financing, and even the aesthetics of today’s manufactured homes.

Manufactured Housing Industry of Arizona President Ken Anderson: Changing enforcement standards by our SAA (State Administrative Agency) has consumed much of our industry.

amount of unsubsidized affordable housing in Florida.

We a re a l so cont i nu i ng to aggressively challenge discriminatory manufactured housing land use ordinances. Last year, the threat of litigation was enough to convince at least

Texas Manufactured Housing Association Executive Director D.J. Pendleton: This varies from what probably most would think and that which is most obvious - state legislative issues - to less thought-of issues like administrative rule writing and regulatory interaction with the industry. There is the whole other basket of issues serving members, answering questions, intervening when needed, developing tools, planning, and having events, and the other host of typical association duties. Then, of course, there are the random curve balls that come out of thin air.

»2

What do you anticipate being the biggest industry breakthrough in your state this year?

Jim Ayotte: The equitable treatment of manufactured housing. Legislation has been proposed in the 2020 legislative session to reduce sales tax on manufactured housing by 50%.

Currently, manufactured home buyers in Florida pay sales tax on a 100% of the purchase price of the home. A 50% reduction will make the sales tax on manufactured housing comparable with site-built homes. This proposal is being promoted as a middle-class tax cut and a way to increase the

The industry’s time has come to be recognized as part of the solution to this country’s growing need for unsubsidized affordable housing.

–Jim Ayotte

one city to change its discriminatory land use ordinance. The association is continuing with this strategy with the expectation that sooner or later litigation will be required. The longterm goal is to obtain a favorable legal decision to require local government to adopt nondiscriminatory land use policies statewide.

Lance Latham: Alabama is one of the leading states for manufacturing, and our manufacturers are always looking for new ways to stand out.

With so many manufacturers bringing new and exciting developments to the industry, it’s hard to single out just one or two breakthroughs that we may see in 2020. »

MHINSIDER.COM • MARCH / APRIL 2020 | 33

STATE ADVOCAC Y

Ken Anderson: The addition of the CrossMod™ product by one of our retailers using the Multiple Listing Service.

D.J. Pendleton: I’ve been doing this nearly 14 years, and our industry’s ability to innovate and try big bold new ideas still pleasantly surprises me. That said, it is difficult to forecast breakouts, I’d argue in pretty much any industry. But as far as a few of the many things we are looking at - roll out of CrossMods, federal responses to calls for zoning parity, manufactured home community sales and acquisitions trends in Texas, and MH market share growth in rural areas, in particular in the multi-section space.

»3

hat do you feel is the most relevant W national issue in the industry today?

to be discriminated against and thought of as an inferior housing product. The HUD code needs to be updated on a continual basis to stay current with the International Residential Code.

The need for non-subsidized affordable housing for American workers has never been greater. The CrossMod home should open access to areas where traditional manufactured homes have been excluded. When consumers and public officials realize the benefits of the factory home building process, they will become more receptive to traditional manufactured housing and manufactured home communities. If embraced and promoted by industry, the CrossMod home has the potential to elevate the entire industry.

In the words of President John F. Kennedy, ”A rising tide lifts all boats.”

Jim Ayotte: There are two issues of utmost importance.

Lance Latham: Zoning is an issue that is getting a lot

Updating the HUD Manufactured Home Construction and Safety Standards and promoting the new CrossMod home.

The HUD code must be comparable with state building codes. Otherwise, manufactured housing will continue

more attention lately. We are also seeing more and more focus on communities and landlord issues. Another issue that doesn’t get as much attention but continues to be an area that many state associations are working on is fair and accurate appraisals, as well as the need for more installers and better training methods for the installer segment of the industry.

Ken Anderson: As I believe we are a finance driven industry, the progress of both Fannie Mae and Freddie Mac will have a substantial impact on our industry for both FHA Title I and II programs.

ld i u B t ’ on es!”

D e W “ om H e l i b Mo

D.J. Pendleton: The financial institutions’ growing interest, acceptance, and participation in our various market segments.

And then, hopefully, growing “comfort” with our industry.

»4

hat do you make of the current merging W of factory-built and site-built practices?

Jim Ayotte: The merging of the factory-home building

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34 | MARCH / APRIL 2020 • MHINSIDER.COM

process with the site-built industry is not new. Site-builders have been using factory-built components for many years to achieve efficiencies. Think roof trusses and wall panels as examples.

The CrossMod home is another step in integrating factory construction to the building site. The CrossMod product offers traditional site builders a solution to one of their biggest impediments – the lack of skilled labor.

The CrossMod also creates opportunities for traditional

STATE ADVOCAC Y

manufactured home retailers wanting to expand their market reach. The lines between factory-built housing and site-built housing will continue to be blurred as more homes and components are constructed off site.

Lance Latham: Anything that helps expand our customer base or makes our homes better and more affordable is a good thing. There are a lot of Americans who have been caught in the housing crisis: wanting the look and feel of a site-built home without the larger mortgages that come with a site-built home. That’s where modern HUD-code homes, modular homes and, now, the new CrossMod homes can fill that need.

In many ways this is a natural merging as market competitive forces push both sides - site-built to gain efficiencies and lower costs and factory-built to learn from site-built to gain market acceptance in the eyes of would-be homebuyers and their lenders, and quickly by extension to governmental bodies.

D.J. Pendleton: We are pulling from a multitude of industries. We see advances in factory design to improve building conditions for labor comfort, as well as efficiency, and retention. And then with experiments in automation, robotics, 3D printing, and utilizing new materials and technologies. If Amazon moves products around in their massive warehouses on robots and SpaceX is landing rockets back on floating drone ships in the ocean after falling from space... I’d say there are ample industries we can learn from.

Specifically, the factory to site-built merger has been occurring for some time now, mostly, I’d argue, in the interiors of the home. The more recent shift now looks to match exteriors as well as interiors.

»5

hat can you tell us about your recent W conversations and negotiations that might be surprising?

Jim Ayotte: Everyday numerous news articles are published detailing the need for affordable workforce housing.

On one hand I have been encouraged by the attention given »

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MHINSIDER.COM • MARCH / APRIL 2020 | 35

STATE ADVOCAC Y

to alternative types of housing, such as tiny homes and container homes, but at the same time I have been perplexed by the short shrift given to manufactured housing. The industry’s time has come to be recognized as part of the solution to this country’s growing need for unsubsidized affordable housing. The industry needs to plow resources into educating consumers and public officials about the unique role of manufactured housing in addressing one of the country’s most challenging social and economic issues.

Lance Latham: There has been a push both nationally and here in Alabama for more investment in infrastructure.

Those road and bridge construction projects cause traffic delays, but those delays sometimes get blamed on the trucking industry and, more specifically, drivers transporting manufactured homes along the interstates. So, the surprise has been a recent interest from some lawmakers in trying to further restrict the hours when we can transport

our homes. So far, we have had success negotiating with lawmakers to find an industry-led solution, but the issue is certainly not settled.

Ken Anderson: The need for affordable housing is forcing cities, towns, counties to open their eyes to MH.

D.J. Pendleton: I’m not sure I have anything surprising that I can share. I will say, the general sentiment I hear is continued optimism, which I still like hearing because I’d equate the majority of people in our industry as candid realists. For anyone who has been through a few of the downturns they remember those conversations at times with people worrying about where the bottom was going to be. My general rule is that if you are willing to listen and regrettably accept the bad, then that also gives you license to accept it when the same candid responses are positive. MHV

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SERVICE / SUPPLY

Confessions of a SelfDescribed ‘Deal Junky’ Luis Vela Looks Back On 40-Plus Years In The Manufactured Housing Industry

by Patrick Revere

Luis Vela, vice president of Q10 Lutz, attended the National Communities Council Fall Leadership Forum in Chicago, and took time with MHInsider to talk about his career in finance.

38 | MARCH / APRIL 2020 • MHINSIDER.COM

SERVICE / SUPPLY

L

uis Vela retired for 18 months.

“I had been running the midwest real estate office for PNC Bank. I was supposed to retire at 67 and worked until 72,” Vela said. “One day I realized it just wasn’t for me.

People who retire need a big hobby, like rebuilding MGs or building something. And I don’t have that.

“I’m a deal junky,” he said.

Born on the Road Maybe part of the reason Vela has business deals in his blood is that he was born on a business trip - in South America.

His father, Walter A. Vela, worked for Sunoco, then known as Sun Oil, in charge of marketing, and then with General Motors, in the capacity as director to the Latin Free Trade Association (LAFTA).

“We went from Rio to San Paulo, to Buenos Aires to Lima, to Caracas and many other equatorial locales all prior to the age of 13,” Vela said. “We’d move every three to six months.”

Education, Army, and Wall Street In the United States by high school, Vela was a champion singles tennis player and played varsity tennis at Michigan State University for 1954 through ’58, where he earned his bachelor’s degree in general business and economics. Next, he went to graduate school at Columbia University in New York City where he earned a master’s degree in finance. He also was in the Reserve Officers’ Training Corps (ROTC), and joined the U.S. Army as a 2nd lieutenant.

Vela trained at Fort Campbell in Kentucky and transferred from the infantry to the Finance Corps in Indianapolis. It’s a place many of the enlisted call “the little Pentagon.” Vela later was promoted to 1st Lieutenant.

“We wrote all the payroll for the Army. We also could write up to seven checks a month for each soldier… house payment, car payment, insurance payments,” Vela said.

He worked on Wall Street for IBM, and was on the team that brought magnetic ink coding to checking accounts in the banking and finance industries.

“That’s my claim to fame,” Vela said with a smile.

“It was a lot of fun to work in New York City. There’s just a tempo there that’s unlike any other place.”

Coast to Coast Vela moved west, to Sonoma, Calif., and served as the chief financial officer for Hy-Lond Enterprises, with 34 extended care nursing facilities throughout California, Idaho, Oregon, Utah, and Washington. However, in 1972 he was badly injured in a horseback riding accident.

He looked at the best options for his own rehabilitation care, and for a good place to recover, and decided to go

He has taught me a lot in finance.

He’s a legend. He was doing deals when this industry was selling 500,000 homes.

–Community Owner and friend, John Rogosich

to Florida. While there, Vela began work with American Community Systems as vice president of real estate in the development of Colonies at Margate, in Margate, Fla. He also worked with Intercoastal Communities with Ned Allen and Richard Kearns, as executive vice president and CFO. “That’s how I got my start in MH,” Vela said. “We had seven MHC retirement communities.” »

MHINSIDER.COM • MARCH / APRIL 2020 | 39

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During this time, Vela worked huge deals with the Sun Communities, Inc., in obtaining a Fannie Mae credit facility.

“We started with $50 million and got it up to $392 million outstanding,” he said.

“We also did a whole bunch of parks in Arizona during the 1980s, in Tucson, Mesa, Apache Junction,” Vela said. “At one point, Phoenix had 80,000 park models, and it seems all of them were being bought by people coming down from Canada.

These park models all had a certain kind of look. A lot of people would extend their park model with a screened porch.

It was a good look.”

Vela then took the position of senior vice president of acquisitions with Chateau Properties, Inc., a newly formed public REIT. From there, Vela went on what many call “a rocket ride”.

“In my time, we grew the portfolio from 14,500 to 75,000 homes,” Vela said. “We were just behind Sam Zell’s MHC REIT, now called Equity LifeStyle Properties, in going public.

That was November 17, 1993.”

At its height, Chateau was the largest manufactured home community owner in the country. It won Community Operator of the Year Awards from the Manufactured Housing Institute from 1994 through ’99.

The Green Tree Years During his time with Green Tree Financial, Vela worked on providing loans for new parks, including construction loans and mezzanine and bridge real estate community expansion loans while serving as vice president of national community financing.

“That was running $8 to $10 Billion per year,” Vela said. “But then the economy tanked. We were in 2007, 2008 and were looking for a way to wade through.”

T he answer, it seemed, was a merger with Conseco Inc., of Alpharetta, Ga. Green Tree merged with Conseco, a publicly held insurance company based in Indiana and traded on the New York Stock Exchange.

“We thought if we could get each of these two large, public ‘middle-income

Q10 National Production (2018) Loan Origination: $4.6 billion Servicing Volume: $9.9 billion Locations: Eight member companies, with 14 offices in 12 states customer’ organizations together that we would be successful and get to the other side,” he said. “It didn’t work.”

At the time, Green Tree became the fifth largest corporate bankruptcy in U.S. history, right after Enron.

“Some of the finance and business books still blame us for the 2007 to 2009 sub-prime recession,” Vela said.

Financial Services, and is a licensed mortgage and real estate broker in the state of Florida.

His son is Luis R. Vela is an orthopedic surgeon and serves as Oregon State University baseball’s team physician. He has a pair of daughters, Meg, in Denver, a graduate of University of Denver, with a 19-year-old daughter and 18-year-old twin boys, and daughter Dodie, in Orlando, who went to Auburn University and works in the wellness field.

Vela’s wife is Lynne, a former flight attendant who worked as an actor in TV commercials.

Q10 Capital, the parent company to Q10 Lutz, is among the nation’s largest servicers of commercial loans, totaling $4.6 billion in loans in 2018.

Vela serves as vice president. Q10 does most of its volume in multi-family financing, with a presence in retail, office, and industrial. The manufactured housing assets make up about 6% of Q10’s volume.

“We represent nearly all of the major insurance companies, large national and regional banks, and CMBS lenders,” Vela said. “Q10 Capital does about $55 billion annually in commercial loan originations.”

“I’m not restricted to lending in one region, so that’s very good,” Vela said.”

“If I meet someone who needs help, no matter where they are based, I can help them.” MHV Patrick Revere is associate vice president of publications for MHVillage and publisher for the MHInsider magazine and blog for industry profe s s i on a l s . Hi s backg round i s in

At Home in Naples

print news, language,

Vela now resides in Naples, Fla., continues his work with Q10 Lutz

and communication.

MHINSIDER.COM • MARCH / APRIL 2020 | 41

SERVICE / SUPPLY

Let Some Light In Panel Processing's Plantation Shutters

by Josh Weston

P

anel Processing’s Plantation Shutters marry luxury looks and affordability, making them ideal for manufactured housing professionals looking for economical sales and remodeling solutions.

In fact, Panel Processing’s National Sales Manager Brad Matuzak said the Plantation Shutters’ high-end design at times has proven to be something of a problem.

Photo courtesy of Panel Processing

them to potential homebuyers as a reasonably priced upgrade, but the gut reaction is, ‘Boy, those look nice, too rich for my blood.’”

Panel Processing’s Plantation Shutters are made of PVC and a high density, moisture-resistant composite wood sheathed in a white coating.

The louvers are thinner and flatter than those of comparable shutters, allowing 40% more light to come into the room, and they have a tight seal when shut, saving the homeowner on noise, unwanted light, and energy transfer. Aesthetically, concealed tilt-controllers come standard with the product, which makes for a clean, symmetrical look, with none of the cords or sticks of traditional blinds.

On top of the luxe design and appealing price point, Panel Processing’s Plantation Shutters arrive in one piece, ready to install. The patented design uses standard cabinet door hinges that anyone can install.

How Did the Panel Maker Get Into Window Treatments?

“One of the things we’re going to have a hard time overcoming is the idea that they’re too expensive, and dealers and manufacturers tend not to ask how much something costs,” Matuzak said. “The price point is a third of what you could see at Home Depot. Factories and dealers can offer 42 | MARCH / APRIL 2020 • MHINSIDER.COM

Panel Processing, founded in 1971 and based in Alpena, Mich., with manufacturing facilities all over the country, has grown to be the largest panel fabricator in North America.

While Panel Processing has a history of working with the manufactured housing industry, supplying cabinets

and parts out of the Alabama facility, their Plantation Shutters product line marks a more direct and targeted relationship in the industry.

“We met a gentleman who had a patented product, but no manufacturing capabilities,” Matuzak said. “We’re woodworkers. We were able to pieceoff a section of one plant and take our woodworking ability as well as our folks who do assembly and pack-out, and it was a nice process. Really pretty simple. Within a couple months we were prototyping and spent the last year honing it. It’s really repeatable and we’ve had no returns so far on any of the products.”

Currently, manufactured housing industry leaders Champion Homes and Clayton Homes are using the shutters in one factory each.

Matuzak hopes Panel Processing’s presence at manufactured housing industry trade shows this year will show dealers that their Plantation Shutters are an attractive, affordable upgrade that’s too good to pass up. MHV Josh Weston is a Michigan-based writer with a background in construction and the trades. He covers the housing market, real estate, management, and finance for MHInsider.

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Greenfield vs. Brownfield Communities?

By Edward Hicks

S

lugging it out with the other hundreds of investors each vying for the few reasonably priced manufactured housing properties is getting harder and harder these days. There are a finite number of existing investment-grade communities out there. And the pool is ever decreasing.

With a few exceptions, in the past 25 years there have been no new non-age restricted communities built. The few that have been built are larger, 55+ communities in retirement areas or near large metros.

Creating a new “greenfield” land-lease community takes more time and attention than just negotiating a contract and going through due diligence, as is the case when buying an existing community. However, with the typical leveraged internal rate of return landing between 35 and 65%, greenfield projects

44 | MARCH / APRIL 2020 • MHINSIDER.COM

FINANCE

can make the extra work and wait all worthwhile for those with capital who are seeking higher returns.

Even existing “brownfield” communities that include entitled land for expansion, or those with adjacent land at a premium, are rare. With the basic operating expense base already in place, additional income from leases was virtually only subject to additional property taxes. Hard to find?

Yes, but impossible, no. Additional effective cap rate went from a poor 5.5% to a whopping 9.5% the first year.

These kinds of “value-added” deals make sense to me and my clients.

Privately funded multi-family guaranteed loans for combination construction to 40-year low interest non-recourse permanent loans are worth the discomfort of obtaining zoning and land use approvals. Once the

necessary entitlements are assured, the key to getting development loans is to show consistent market demand.

That means not only producing a review of area metrics showing intrinsic household growth, or at least stability, but also comparisons of the proposed housing costs for target residents in the context of other housing alternatives: apartments, single-family »

MHINSIDER.COM • MARCH / APRIL 2020 | 45

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Photo courtesy of Edward Hicks

starter homes, and even RV parks where indicated.

These rarely used loan guarantee programs provide for acquisition and rehabilitation, or rehabilitation and refinance of existing communities, as well as new development financing by private lenders for qualified manufactured home land-lease or cooperative communities. Subdivisions and condominium projects are not included.

Private lenders provide for up to 90% of construction costs, the land at value (not necessarily cost), and all on-site infrastructure including, but not limited to: • Storm water management, • On-site utilities • Water/sewer distribution/collection • Electrical service • Telephone and cable TV services • Natural gas • Grading and roadways • Engineering and survey costs • Governmental impact or utility tap fees

limitations are imposed other than regular operating statements, a yearly rent roll, and compliance with all local, state, and federal equal housing laws and regulations.

The community must be operated as a single-purpose legal entity, and all investors or owners with more than a 25% equity are subject to a personal history questionnaire to verify no serious previous history of default on government loans (including student loans) and no pattern of business failures. Previous real estate and/or business experience is helpful in obtaining an approval, but this is considered rather than required.

Manufactured homes may be sold in the community by the developer, but not to the exclusion of other area retailers, as long as the homes and installations meet community requirements. Cash f lows from in-community home sales may not be used as a financial justification for net operating income calculations or to justify loan equity requirements at closing.

Another similar loan guarantee program is for new apartment construction using HUD-code homes, as single-family detached housing,

writing and subsequent funding is by a private lender for qualified projects using the Multi Family Accelerated Processing system, and then is sent to HUD staff for review and approval.

As with the infrastructure program for land loans, land value and infrastructure costs are included, but no general contractor’s fees or overhead if the builder and sponsor’s profit and risk allowance is used. Loan fees range from 1.5 to 3.5 points plus audit and engineering supervision.

HUD code dwelling units must be new, not used or rehabilitated. Funding provides for up to 90% of land value, infrastructure, foundations, dwelling units, and accessories (a/c, drives, carports or garages, for instance). If the project is cost limited, the builder and sponsor profit and risk allowance and any excess of land value over cost may be used as a part of the project’s equity requirements.

For the right market conditions, reasonable construction costs, some marketing, and home sales acumen, greenfield projects may be in order. A quick summary review of a proposed project can be done online and/or with the help of a qualified lender or commercial loan broker. MHV Edward “Eddie” Hick s is principal consultant for Consultants Resource

Amenities

Group, available at

Additionally, general contractor fees, overhead, security costs, interest taxes, and insurance during construction are all included up to the loan limits. Off-site construction and excess land are not funded. These must be left out of the first phase of financed work, but may be included upon refinancing for phased expansion. Typically, no rent controls or

(844) 642-6668 and easteddie@aol.com.

Photo courtesy of Edward Hicks

With over 45 years experience as a manufactured home retailer, manufacturer,

provided the development site is zoned and approved for manufactured housing. If not, factory-built modular units must be used. This is typical when building a project with duplex or single-family attached units. Under-

developer, and real estate broker assisting clients with their community development, financing, and acquisitions. Learn more at www.mobilehomepark.com.

MHINSIDER.COM • MARCH / APRIL 2020 | 47

FINANCE

Triad Financial Services Offers Attractive New Financing

by Patrick Revere

T

riad Financial Services, a national lender for manufactured homes, has launched a new loan program for homebuyers called the Bronze program.

Terms for the new program includes a lower credit score, down to 575, and up to 50% debt to income ratio and up to 300-month term. The applicant’s minimum down payment is 10%.

“We’ve never had anything for customers with a credit score below 650. Historically, our lending partners have been banks and credit unions,” Triad Senior Vice President Darrell Boyd said. “This is a departure for us, but with the interest we’ve been getting from equity funds, credit funds, and pension funds, we’re able to do more.”

Triad recently entered a partnership with private investors who can back more generous loan terms for a new set of customers.

48 | MARCH / APRIL 2020 • MHINSIDER.COM

“Consumer borrowing is picking up again,” Boyd said.

“People are going back into bank branches again and many community banks and credit unions are also offering online credit applications.”

Triad was founded in 1959 and has three offices. The company is headquartered in Jacksonville, Fla., and has offices in Bourbonnais, Ill., and Irvine, Calif. The company works with nearly 150 lending partners, as well as with community lending programs and retailers to finance manufactured homes.

“Our customers trust Triad for its professionalism and hard work in finding competitive rates that can help their customers and clients get financing,” Boyd said. “Lenders and investors value Triad as a leading consumer lender that offers profitable portfolios in today’s market.” MHV

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BUILDER / RE TAILER

College Visit Leads to New Business Plan, Affordable Home Builder

by Patrick Revere

S

Sean Geehan was at a father-daughter weekend at Miami University in Oxford, Ohio, when he was struck by a notion that would stick with him and change the course of his career.

That was the spring of 2016.

“I couldn’t get a hotel room and started doing some research on apartments, or hotels around colleges in rural areas and I didn’t see much,” he said. “I came across modular, and felt like it would be a great solution. But it became clear we wouldn’t want to get into apartments or hotels, and we really wanted to get into residential, which continues to be the real need.

“I worked on this for a year and a half before I even told my wife,” he said. “My background is in technology, and merger and acquisitions. I have no background in building, so I needed to do my research. I didn’t want everyone to think I’m a fool, which they probably still did.”

Geehan found some investors and began to put a team together that would provide the much-needed trades and industry experience.

“None of us were in modular two years ago,” Geehan said.

“We were at 15 people at the end of 2019, and we’re bringing on another 10. We want to continue with all on-staff labor.”

Slate Homes launched at the end of 2018, closed its first deal a year ago, and did three more projects through 2019.

In 2020, Slate Homes is in full production. »

52 | MARCH / APRIL 2020 • MHINSIDER.COM

Photos courtesy of Slate Homes

Slate produces limitedrun modular homes that fit the aesthetic of the neighborhood or area where the new homes will be placed.

BUILDER / RE TAILER

Slate produces limited-run modular homes that fit the aesthetic of the neighborhood or area where the new homes will be placed. The first home for Slate was infill for an empty parcel in Walnut Hills, a neighborhood in Cincinnati.

Slate also is working on 11 duplexes for a resort town in Colorado, with the capacity to do another 40 duplex homes as needed.

The cost of construction in these locales is about $450 per square foot and sell for $1,200 to $2,000 per square foot, depending on the market.

“It’s not just Aspen and Vale, it’s Basalt, Winter Park, and other resorts,” Geehan said. “They just can’t get any labor to build homes, and when you do it’s very pricey. It’s a commute and

you have to bring the materials in. So they’re looking at what we do, and it meets the need. We’re having a lot of success with it.”

The company also is working with developers on residential infill projects in Detroit. The Ford Innovation Center is ramping up, with the hiring of 5,000 new employees.

“So we’re working with a developer who’s buying land right around there to put in a good mix of ‘build to rent’ homes and others that are being built to sell,” Geehan said. “We have our own interior designer. Customers can come to our main office and sit down, look through the floor plans, material options, and all of our offerings.”

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thoughtful design and have a strategy that brings affordable homes quickly to the market.

“I wanted to do a more high-end home, and saw some of the stuff that’s being done out west,” Geehan said.

“We started to think about how to do mid- to high-end finishes in batches of 40 or 50 homes.”

The moderate-sized runs are enough to build in needed efficiencies but maintain the custom-look of each home.

“For us, everything is a smooth finish. You’re not going to find popcorn ceilings or seams. It’s almost like we’re putting up a custom home but we’re building 20 or 30 of them,” he said. “That middle layer is where we play. How do we take something we can run 25 times that will have the features that really draw people in. Cedar with a solid stain, maybe a different color Hardie Board and other features that are eye-catching and pleasing.”

The strategy started with a conversation Geehan had with his nephew, Travis Wilson, who is a high-end home builder and now serves as senior vice president of construction for Slate Homes. Wilson oversees all of the building and site work.

“What if we could take the assembly-line mentality and apply it to what you do?” Geehan recalls asking Wilson. “It’s all the detail like Amish custom cabinets and high-end control systems throughout.”

The strategy seems to have worked.

Slate had its 2020 calendar year filled in the first month of last year.

“And we’ll be looking to add a second production facility probably in mid2021 or early 2022,” Geehan said. MHV

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MHI CONGRESS & E XPO

2020

April 6 – 8, 2020 MGM Grand, Las Vegas

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EVENT HIGHLIGHTS

EXPO HALL HOURS

• 12 Insightful Workshops

Monday, April 6 • 5:00 PM – 6:30 PM

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Tuesday, April 7 • 8:00 AM – 6:30 PM

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Wednesday, April 8 • 8:00 AM – 10:45 AM

• 1,400+ Event Attendees

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OPENING SESSION – GROWING THE MARKET TUESDAY, APRIL 7, 2020 • 9:00 AM – 10:15 AM

Presented by: Bill Boor, President & CEO, CAVCO Kevin Clayton, CEO, Clayton Mark Yost, President & CEO, Skyline Champion

After nine consecutive years of production and shipment growth, the manufactured housing industry has leveled off. These manufacturing leaders will discuss their strategies on growing the market, including expanding existing and developing new communities.

They’ll also share how CrossMod™ homes are beginning to penetrate new markets that have previously restricted manufactured homes and the opportunity CrossMod homes represent for the industry to expand beyond 10% of the single-family housing market.

56 | MARCH / APRIL 2020 • MHINSIDER.COM

MHI CONGRESS & E XPO

ENHANCE YOUR TIME AT CONGRESS & EXPO – ADD ON EVENTS YOU WON’T WANT TO MISS 16TH ANNUAL OLIVER TECHNOLOGIES GOLF OPEN SUNDAY, APRIL 5 Enhance Congress & Expo by networking with industry stakeholders at TPC Las Vegas at the 16th Annual Oliver Technologies Golf Open! With a valued tradition of fostering business opportunities amid PGA-tour quality conditions, this tournament supports MHI’s advocacy on behalf of manufactured and modular housing. Golfers of all skill levels will bond over the thrill of testing shot-making skills where champions play.

All-inclusive registration fee includes round-trip shuttle from the MGM Grand, green and cart fees, warm-up balls, box lunches, beverages, cash prizes, gifts, and more.

4TH ANNUAL HART KING/LUTZ, BOBO & TELFAIR CLAY SHOOT SUNDAY, APRIL 5 Strengthen business opportunities during Congress & Expo with an exceptional morning of sporting clays at the Clark County Shooting Complex. Industry leaders will revel in Nevada’s 5-Star outdoor shooting facility while building camaraderie at this popular event that benefits our industry’s advocacy. Allinclusive registration fee includes round-trip shuttle from the MGM Grand, breakfast, range safety supervision, 100 shotgun shells and clay targets per person, shotgun rental, safety gear, and carts. Experience the fun of sporting clays while supporting a worthy cause and increasing your business contacts!

NATIONAL COMMUNITIES COUNCIL (NCC) SPRING FORUM MONDAY, APRIL 6 The NCC Spring Forum is a day-long event exploring trends and practices of manufactured home community owners and operators. The forum delivers a unique learning opportunity to discuss issues including market trends & acquisitions and research findings. It also shows best practices for owners and operators and provides excellent opportunities for professional networking. If you’re involved with manufactured home communities whether as an owner/ operator, service provider, lender, or consultant, this event is for you!

DEVELOPING WITH MANUFACTURED HOUSING SEMINAR MONDAY, APRIL 6 The Developer Seminar educates and provides industry knowledge for builders and developers looking to utilize factory built housing to save time and money and to provide innovative, affordable, options to homebuyers. This day-long seminar delivers a unique opportunity to explore a wide spectrum of topics that includes site selection, pro forma, due diligence, and finance.

Attendees are supplied with workbooks and are given the opportunity to “Meet the Manufacturers”, and participate in a “Shark Tank” panel.

Registration for all add on events for new Congress & Expo registrants is available online at http://www.congressandexpo.com/register/.

To add these on to an existing Congress & Expo registration, contact us at registration@mfghome.org.

MHINSIDER.COM • MARCH / APRIL 2020 | 57

MHI CEO Dr. Lesli Gooch and President Mark Bowersox.

Photos courtesy of MHI 58 | MARCH / APRIL 2020 • MHINSIDER.COM

A NE W ERA

NATIONAL ADVOCAC Y

FOR MANUFACTURED HOUSING

by Patrick Revere

T

The last decade has been one of changes and challenges for the manufactured

housing industry. Through it, the Manufactured Housing Institute has worked tirelessly in Washington to reduce regulatory barriers and change perceptions that limit access to affordable, factory-built homes.

MHI has been successful in leading change that results in industry growth. »

MHINSIDER.COM • MARCH / APRIL 2020 | 59

NATIONAL ADVOCAC Y

There is a long list of legislative and regulatory accomplishments. MHI does its work partly through expanded offerings that include a diverse selection of resources for industry professionals. Members can make connections in the industry, stay current on new rules and procedures, expand their geographical influence, and generally create a better foundation for business success.

The advocacy group has grown into a full-service trade association representing every segment of the manufactured housing industry. Much of that growth happened under the watch of former MHI President and CEO Dick Jennison, who retired at the end of 2019.

A search committee was assembled to vet and interview potential

candidates. It was nearly a year-long process. The committee met with several well-qualified candidates.

When the dust settled, the board convened a special meeting to amend the association’s bylaws and install a new leadership structure at MHI. Now, two of MHI’s top-ranking executives have stepped in to take the torch and lead the industry going forward.

MHI 2.0 In November, MHI announced Executive Vice Presidents Dr. Lesli Gooch and Mark Bowersox would be appointed to succeed Jennison as CEO and president, respectively.

“We’re calling it MHI 2.0,” said MHI Board Chairman Tom Hodges.

“Lesli and Mark are highly qualified

11

60 | MARCH / APRIL 2020 • MHINSIDER.COM

and passionate about MHI’s mission to elevate manufactured housing.

The combination of their skillsets complement the objectives of our association and we look forward to seeing the impact we know they will have as they work together to advance manufactured housing.”

That pairing should excite manufactured housing professionals who know Gooch and Bowersox — and who understand just how effective they’ve been working on behalf of the industry.

Lesli Gooch: The Advocate Gooch, a long-time staffer on Capitol Hill and former candidate for Congress, joined MHI in 2015, bringing with her a wealth of advocacy knowledge and experience.

NATIONAL ADVOCAC Y

During her time on the Hill, Gooch served as the senior policy director for Congressman Gary Miller, the vice chairman of the House Financial Services Committee. Miller, a homebuilder and developer, championed access to affordable homeownership opportunities, including through manufactured housing.

“I have dedicated my career to the affordable housing mission, especially homeownership. Manufactured housing offers the most viable -- and disruptive -- solution to filling the gap in the production of affordable homeownership options,” Gooch said. “Our industry is proof that quality and affordability are not mutually exclusive when you build smart and constantly innovate.

Manufactured housing is the great disruptor and it’s an honor to fight for a better environment for our industry and for homebuyers to thrive. I’m a true believer.”

That passion has translated into some remarkable results for the industry. Gooch has been behind some of MHI’s most impactful, landmark accomplishments.

For the last two years, U.S. Department of Housing and Urban Development Secretary Ben Carson has delivered the keynote address at MHI’s annual Congress and Expo.

It’s evidence of the work going on behind the scenes. Gooch and her team have established an excellent working relationship with members of Congress and the administration to help advance the priorities and concerns of the industry.

“Policy change does not happen overnight,” Gooch said. “I’ve spent 20 years in Washington, D.C., working within the housing policy community… if there is one thing I have

learned it is the value of maintaining relationships. Quality, productive connections open up a fast lane for getting things done here in Washington. It’s incredibly important to achieving the goals of the industry.”

And you can see those relationships at work. In June 2019, HUD announced its first annual Innovative Housing Showcase. Gooch leveraged her relationships w it h H U D a nd worked diligently to have three fully furnished HUD-code homes on the National Mall.

“Our industry shows well,” Gooch said. “Every segment of the industry stepped up in support of this effort and it would not have been possible without the commitment and hard work of our members.

“It was an excellent opportunity to show people who normally are not

Manufactured housing offers the most viable – and disruptive – solution to filling the gap in the production of affordable homeownership options.

–Dr. Lesli Gooch

exposed to manufactured homes, many of whom were policymakers and homebuyers. The high quality and design of the homes we build, it changes minds and perceptions,” she said. “That is so important to

achieving our goals on behalf of the industry and it simply could not have been done without the significant time, money, and resources our members offered to help elevate manufactured housing on the nation’s front lawn.”

White House Convenes Housing Committee Shortly after the showcase, manufactured housing was included in an executive order to establish a White House council of administration officials charged with eliminating regulatory barriers to affordable housing. Led by Secretary Carson, the council works to address policies that impede the production of affordable housing at all levels of government.

Gooch believes this should pave the way for expediting changes to the HUD code and creating a streamlined path for updates going forward. In addition, it opens up the conversation on undue scrutiny leveled at manufactured housing in zoning. » MHINSIDER.COM • MARCH / APRIL 2020 | 61

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“The conversation should start with our industry and its commitment to quality and affordability,” Gooch said. “People are looking for high-quality homes, innovatively and efficiently built, that can help navigate this shortage of affordable housing. They’re beginning to see that the answer has been here the whole time in manufactured housing,” she said. “Our champions in Congress are talking about manufactured housing with the administration and it’s creating more opportunity. Those opportunities would not be available without the quality and innovation of our industry.”

Still, Gooch says there is a lot of room to grow the market and plenty to accomplish for MHI. It’s been a decade since HUD last published a comprehensive update to the code that guides an evolving and growing industry. That, along with FHA Title I and II updates, as well as elevating the Office of Manufactured Housing Programs and a number of other HUD reforms, MHI 2.0 will

have its hands full in 2020. But its priorities are certain to make up a great deal of the equations that will grow the market.

“Everyone is extremely optimistic,” Gooch said. “We are looking ahead and the future looks very bright for our industry.”

Staying connected with and understanding the needs of our members is a major priority for our team.

–Mark Bowersox

Mark Bowersox: The Connection Leading MHI’s industry relations efforts since 2015, Bowersox has been a stellar ambassador for the association and for the industry. During his time at MHI, membership has gone from less than 300 members to better than 900. Event attendance also has increased, up more than 50% during his tenure.

“Staying connected with and understanding the needs of our members is a major priority for our team,” Bowersox said.

“We want each member to have a personal connection and unique experience with MHI. It’s all about relationships.”

Ask Bowersox and he’ll tell you his favorite days on the job

are those spent with members. From networking that creates vital connections for manufactured housing to thought leadership around the industry, and the events that provide the most important opportunities for members to connect and drive the industry forward. Facilitating that, Bowersox said, has a massive impact on the industry and the overall value for members.

Real-Time, Ground-Level Organizer Before bringing his talents to MHI, Bowersox served as the executive director of the Indiana Manufactured Housing Association — Recreation Vehicle Indiana Council where he led all aspects of the organization.

The experience was foundational for Bowersox.

His knowledge base was built from the ground up with first-hand experience in zoning, titling, installation, and other common yet challenging issues.

“Working within the industry in a situation that requires many hats is incredibly valuable,” Bowersox said.

“When our members contact MHI, they want to know they’re talking to someone who understands, from the beginning of the conversation, the industry’s challenges and needs, and how we can help them.”

Bowersox also has worked with his team to develop new training programs for community managers, salespeople, and installers, all of which have migrated to an online learning platforms that create a broad-reaching, user-friendly experience for MHI members.

“Manufactured housing is a unique industry,” said Bowersox. “Outside the HUD code, there’s really not a ‘one-size-fits-all’ category for our »

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NATIONAL ADVOCAC Y

organization. We’ve customized our educational offerings to provide the most effective teaching and training that perfectly fits the needs of our membership. It’s about creating the right conditions for industry success, and a higher quality product for homeowners.”

With the new leadersh ip in place, MHI will focus on unifying membership behind the banner of market growth.

“We need to speak with one voice as an industry,” Bowersox said. “There is a lot of strength in our numbers, especially when we come together to achieve the common goal of growing the industry by providing homebuyers with the best possible product and service at a great price.”

MHI 2.0: The Future The leadership combination resonates as a strong endorsement from the MHI Board of Directors in regard to organizational direction.

Both Bowersox and Gooch bring very well tailored background and experience that has helped carve the path to a brighter future for the association and the industry. Now, MHI moves forward with a dynamic dual watch created by the combined effort that has industry, member, and industry customer in mind.

“We’re ready,” Gooch said. “We work so well together and have shared so many wins for the industry, it feels less like a big change and a continuation of mission we’ve always worked toward — elevating the manufactured housing industry.

We have the momentum to make a difference and the plan to get it done.”

While MHI 2.0 takes shape, there are plenty of irons in the fire to keep that momentum. In late 2019, MHI 66 | MARCH / APRIL 2020 • MHINSIDER.COM

announced CrossMod would be the trademarked name for what has been referred to as the “new class of home”.

CrossMod is a certified mark MHI members will use to let homebuyers know they’re purchasing a quality HUD-code manufactured home that conforms with the requirements for conventional financing laid out by Fannie Mae and Freddie Mac. It also can be appraised using comparable site-built homes, which has the po-

This new category of home is built to the HUD code and also is nearly indiscernible from site-built homes, other than the price tag.

tential to take manufactured housing to communities that previously may have zoned them out.

“CrossMod is a big deal for manufactured housing,” Bowersox said. “It’s not a replacement for factory-built housing as we’ve known it. This new category of home is built to the HUD code and also is nearly indiscernible from site-built homes, other than the price tag. It also addresses a gap in affordability experienced across the country. There are people actively looking for quality homes under $250,000 who aren’t being served.

CrossMod has the potential to be a game-changer for that market.”

New Product to Challenge Exclusionary Zoning Exclusionary zoning practices continue to be the primary point of contention when it comes to bringing factory-built housing to the metro areas that need attainable and affordable homes.

Gooch and her team work with HUD and the administration to influence state and local regulators who have yet to consider manufactured housing. The team also focuses on expertly telling the story of manufactured homes, from the value manufactured housing brings to the people who build them and to the people who buy and live in the homes our industry builds.

“We feel very good about the direction things are headed,” Gooch said. “Our state association members and partners do phenomenal work fighting for the industry. Together, we are making progress. And supporting their efforts is among our team’s highest priorities.

“For the first time, our industry has taken center stage in the affordable housing discussion,” Gooch said.

“There’s a growing appreciation not only for the attainability of factory-built housing, but the quality and efficiency with which they are built.

That’s a good indicator of even more opportunity on the horizon.”

With Gooch and Bowersox at the helm, MHI’s team has the pieces in place to make a significant impact on the industry and in Washington.

“We entered the year in midsprint,” Bowersox said. “We have a phenomenal opportunity here to lay the groundwork for our members and the industry, and now we get to work.” “ T h at ’s w h at we do b e st ,” Gooch said. MHV

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NATIONAL ADVOCAC Y

WHAT IT MEANS TO BE A MEMBER IN MHI 2.0

by Dr. Lesli Gooch

I

It’s a new era for MHI and manufactured housing. We’re seeing a shift in perception as our industry is drawing more people looking for viable, quality solutions to overcoming the shortage of affordable housing across the country.

That means there has never been a more important time to support MHI’s work to ensure factory-built housing remains a priority for the administration, HUD and Congress’ affordable housing initiatives.

68 | MARCH / APRIL 2020 • MHINSIDER.COM

Over the last 10 years, MHI has grown and evolved to offer a wide variety of benefits for its members.

From new educational curriculums to advocating for greater access to manufactured housing, MHI’s members enjoy the representation of a phenomenal, service-minded team dedicated to creating new opportunities for elevating the industry—including a full slate of annual events aimed at connecting factory-built housing professionals, a diverse offering of

educational curriculum and regular updates to keep members informed, and a consistent focus on growing support from decision makers in Washington, D.C. And as the organization has grown, so has its membership. Nearly 1,000 members strong, MHI represents every segment of manufactured housing. We could not do it without the support and cooperation of our members, so we wanted to highlight just some of what MHI offers its »

NATIONAL ADVOCAC Y

Ensuring Federal Support for the New Class of Manufactured Home Last year, MHI announced CrossMod™, a new product category for manufactured housing. CrossMod is more than just a name. It’s a mark of quality our members can use to let homebuyers know they’re purchasing a home with all the innovations and efficiencies for which HUD code manufactured homes are known A new model home from Clayton that meets the standard for the CrossMod™ name and opens up the potential for conventional financing with appraisal comps from site-build homes as needed. Photo courtesy of Clayton Homes.

while also meeting the requirements for conventional financing with the GSEs. CrossMod homes combine the innovations and efficiencies of factory-built homes with features built on site. They can also be appraised using comparable site-built homes, from which they are virtually indistinguishable, when placed according to GSE financing requirements. With these considerations, CrossMod has the potential to find acceptance in jurisdictions that have traditionally zoned out manufactured housing.

It’s another example of how MHI is working with its members to change the conversation around manufactured housing and ensure federal policies and programs support this quality housing that is offered at a price point consumers can afford with the features they want.

MHINSIDER.COM • MARCH / APRIL 2020 | 69

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members and the industry, in terms of advocacy, events, and education.

Advocacy MHI is an effective voice for the industry in Washington.

Through our effective outreach with administration officials, consistent presence on Capitol Hill, and cultivation of strong bipartisan relationships, MHI has created a better regulatory environment for manufactured housing in Washington, D.C., and ensured that manufactured housing is part of the national dialogue when discussing solutions for addressing the country’s affordable housing shortage. Our effective advocacy for 2020 is focused on reducing regulatory barriers and expediting changes to the HUD code, improving the availability of financing, paving the way for a new class of manufactured homes, and communicating the value and promise of manufactured housing to policymakers, the media, and the public.

Reducing Regulatory Barriers Because of our successful advocacy efforts, President Trump issued an executive order last year seeking to allevi-

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ate barriers that impede the production of affordable housing and specifically references manufactured housing as an area that has been hindered due to “outdated manufactured housing regulations and restrictions”.

MHI has secured a champion in HUD Secretary Ben Carson who continually extols the benefits of manufactured housing as an affordable housing option not only during Congressional hearings, but at industry events and to the media. MHI is working with Secretary Carson and his senior leadership to expedite changes to the HUD code and exercise the department’s preemption authority to eliminate discriminatory local zoning and land-use planning regulations.

But these successes are only possible with direct engagement from our members, which is an important part of our advocacy efforts. MHI has worked to ensure our collective voice is loud and effective when it matters most.

Manufactured housing is entering an unprecedented era of acceptance and interest from policymakers and the public.

That’s due, in part, to MHI’s consistent and effective advocacy. It’s also due to the work our members are doing every day to innovate and improve the methods and processes to make high-quality manufactured homes without sacrificing affordability. It is critical that policymakers see and hear firsthand from MHI members about these advancements.

During MHI’s 2019 Legislative Fly-In and Homes on the Hill event, MHI members conducted more than 100 meetings with members of Congress advocating for important changes such as updating the HUD code, renewing the 45L tax credit for energy-efficient homes, and updating Federal Housing Administration financing programs. There is strength in numbers and the impact MHI’s members have by serving as an industry voice in front of their elected officials is critical. In addition, due to strong support from its members, MHI helped to facilitate the placement of three fully furnished manufactured homes on the National Mall for policymakers and the public to experience the quality factory-built housing across a range of price points.

Improving the Availability of Financing In addition to keeping the HUD code current and alleviating regulatory barriers, MHI is also working to improve the availability of financing for manufactured homes, through federal programs such as the Federal Housing Administration (FHA) and the Government Sponsored Enterprises (Fannie Mae and Freddie Mac). We are also working to ensure the Consumer Financial Protection

NATIONAL ADVOCAC Y

Bureau supports financing for manufactured housing in its lending regulations.

resident-owned communities. The results of that research are coming soon, so stay tuned.

Conveying the Benefits of Land-Lease Communities

Connecting the Industry

At MHI, we believe there is strength in numbers. That’s MHI continues to advocate the benefits of land-lease why we are constantly looking for new ways to bring our communities and ensure that any federal legislative or members together to network and share ideas. As the only regulatory actions do not discriminate against this homenational trade association representing every segment of ownership option. MHI is working to ensure that media, the manufactured housing industry, MHI offers a diverse policymakers, and homebuyers understand these benefits. selection of conferences and networking opportunities for Our National Communities Council has embarked on members. For a full calendar of events and offerings, visit an effort for individual owners/operators to connect with our website at www.manufacturedhousing.org. members of Congress about the value of, and resident From April 6-8, we’ll be hosting our annual Congress satisfaction with, communities in their and Expo at the MGM Grand in Las congressional districts.

Vegas. This is MHI’s premier event We want Congress and the adminfor the industry and we are on pace for At MHI, istration to understand that the vast record-breaking attendance this year. majority of investor-owned, land-lease That means even more opportunity to we believe there is communities in the United States are make connections around the industry strength in numbers. professionally managed, well-run that will help grow the market and inThat’s why we are and well-maintained by responsible spire the kind of energy and enthusiasm owners. Investors and managers are our members share for manufactured constantly looking responsible for infrastructure and housing and the home buyers they for new ways to capital improvements, and are comserve. This year attendees can make bring our members mitted to providing residents reliable, business connections while exploring high quality, and professional services over 140 vendor booths and networking together to network that are an integral component of with over 1,400 attendees. We’ll also and share ideas. residents’ quality of life and lifestyle. offer more than a dozen workshops Most importantly, the residents who that will give you the tools you need to live in these communities are highly succeed—including in-depth sessions satisfied with their housing choice according to a recent on a variety of focused topics like the NCC Spring Forum consumer survey by MHI. and Developing with Manufactured Housing. You can Further, NCC recently reaffirmed its commitment to also join us early for the annual golf outing or clay shoot ensuring residents of manufactured home communities to support the MHI-PAC. With so many opportunities have the highest quality of lifestyle by approving a nato connect and explore Las Vegas, you’re guaranteed to tional Code of Ethics. The NCC Code of Ethics outlines find your time at Congress and Expo to be worthwhile. eight principles that NCC members must abide by as Come join us and experience it for yourself! We hope part of their membership with MHI. These principles to see you there! focus on promoting the benefits of manufactured housing and land-lease communities, as well as customer Education and resident relations.

MHI also offers training and certification curriculum to MHI has also commissioned new research to demonensure uniformity and the highest quality for consumers. strate the important role land-lease communities have From installation to community management to the latest in creating affordable housing opportunities across the issues and trends, our organization is committed to providcountry. The study will provide a comparative analysis ing the tools to ensure our industry is providing consistent, between land-lease communities and other forms of housing, exceptional service. » including site-built homes and HOAs, apartment rentals and MHINSIDER.COM • MARCH / APRIL 2020 | 71

NATIONAL ADVOCAC Y

MHI offers a variety of ways to keep members and subscribers up to date on our work in Washington and issues relevant to manufactured housing—including a bi-weekly newsletter exclusively for members and webinars on key industry topics.

We also share updates on happenings in Washington during our events nationwide, as well as workshops, keynote speakers and facility tours, roundtable discussions, summits, and other educational events.

Together MHI and the Manufactured Housing Educational Institute (MHEI), announced the launch of our Accredited Community Manager (ACM) 2 course, in December.

This second curriculum requires the completion of ACM 1 and offers community managers additional tools

needed for success. The program is offered both in person and online and offers guidance for managers on how to keep sites full and treat residents fairly. Local, state, and federal guidelines can leave you liable for the actions—or inactions—of your community manager. Investing in the ACM training may save you time, money, and resources avoiding fines and fees.

MHI is committed to offering our members and the industry all of the resources they need to succeed. This course was designed and developed to ensure quality, consistent service throughout the industry. To register for ACM 2 or to learn more about MHI’s educational offerings, visit https://www.manufacturedhousing. org/education/.

Join the Fight MHI and its members have formed a unified front to pave the way for new innovations in manufactured housing.

From education to advocacy, our team is committed to creating a better future for manufactured housing by clearing the path for a regulatory environment that favors increased manufactured housing production and a better business environment for our members. MHV Dr. Lesli Gooch is the CEO of the Manufactured Housing Institute, the national trade organization representing all aspects of the factory-built housing industries.

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Ocean Breeze

on Marathon Key Built for the Biggest Storms

by Patrick Revere

74 | MARCH / APRIL 2020 • MHINSIDER.COM

New homes at Ocean Breeze on Marathon Key are built to withstand high winds and flooding. Photos courtesy of Ocean Breeze and Sun Communities.

O

cean Breeze in Marathon Key has seen its fair share of large storms, but following the destruction of Hurricane Irma in September of 2017 the community was rebuilt with a new aesthetic, and one that will help fend off the high winds and flooding of the future.

“Unfortunately we lost everything in the storm, but it’s an opportunity to redevelop,” Ocean Breeze sales associate Michelle Meszaros said.

“We worked with Nationwide and we designed these homes alongside of them to meet all the new standards that were put into effect after Irma.”

The new homes, built to local modular specifications within a stackable HUD-code envelope, are upon foundational pilings and are built to withstand high winds and flying debris.

What Makes the New Ocean Breeze More Durable?

“In a lot of cases, the homes will be more wind resistant than a concrete block structure,” Meszaros said.

“They’re made to withstand sustained winds of up to 180 miles per hour.

“With the Bahama shutters, you can open the windows and bring them inside the home to protect the window and the interior, including

the occupants,” she said. “Many storm shutters will protect from a palm tree coming through or something like that, but the glass will still break. And it’s expensive to replace a window.

This shutter protects the glass from outside debris.” »

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MHINSIDER.COM • MARCH / APRIL 2020 | 75

COMMUNIT Y

Each home has a metal roofing system and Hardie board siding, which is a concrete-fiberboard that comes in a variety of textures and colors. Both upgraded materials help protect the home during a storm. And each is much less likely than standard materials to dislodge and create a further hazard for the community.

“It holds up really well to the hot Florida sun,” Meszaros said of the siding and trim. “It doesn’t fade like other siding might, so you don’t have to get up to paint it nearly as often.”

The community had 16 new homes in place at the beginning of 2020 with plans for another 15 homes during the first quarter. All of the homes have high ceilings and plenty of natural light.

“The homes are meant to be very low maintenance,” she said. “We have

beautiful Trex decking and also the stairway that goes up in the second level is made by Trex. And there are beautiful, nautical looking stairway rails, with posts and guy-wires.”

Likewise, all of the exterior hardware and components of the homes, as well as the community buildings and common areas, are made from noncorrosive materials. Rebar and concrete foundations are drilled and anchored into the corral below. Brick and paver driveways go under each home and throughout the community.

With Ocean Breeze rebuilt to withstand heightening forces of Atlantic storms, Sun Communities, the Michigan-based owner, can let the property be as it was intended -- an enchanted seaside resort in the middle Keys.

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Much Needed New Housing in Central Florida Keys Beyond the durability of the revamped community, the new homes it provides are much needed affordable housing in a resort area known for its multi-million dollar dwellings.

“If you talk about the Keys, our homes are affordable,” Meszaros said.

“You can’t even purchase a home on the canal for under $1 million. Right next door to us there’s a developer putting in $6.5 million homes. Ocean Breeze is very affordable for the Keys.”

Waterfront homes at Ocean Breeze will sell for $390,000, with homes in the $200s at the interior. Interior monthly site rent is $1,100 and $1,350 at the water. Former residents of Ocean Breeze are provided special pricing if they opt to return.

“Some of them are coming back. We offered them the rebuilt community, brand new homes and all the amenities, fully insured, at 5% below cost,” she said. “We are pleased that some people did come back.”

Common areas include an openair pavilion on the boardwalk. It has comfortable seating, including couches, a TV and a grill. The harbor has been dredged, and a new dock system with 14 boat slips was put in. Sun Communities also installed a sunset deck with mature coconut palms and a hammock garden.

“There’s a lot of fishing and snorkeling, obviously, so it really is a beautiful place to be,” Meszaros said.

“It’s one of the great spots because you’re right in the middle,” she said of Marathon Key. “It’s often called the heart of the Keys. There’s shopping, retail, and medical access. People don’t realize here that you can get to the grocery store in 10 minutes whereas in other spots it may take you an hour to go to the store.” MHV

COMMUNIT Y

low-hanging fruit The Essentials of Operating a Manufactured Housing Community

by Steven Blank

M

a nu fac t u red hou si ng communities are a unique for m of mu lti-fa m i ly housing, the differential being that we primarily are responsible for our community buildings, common areas, and infrastructure but not the homes, except as they relate to community aesthetics. To expand the differential between MH and other forms of multi-family, in many cases our resident’s home investment was larger than the community owners, on a persite basis. Resident-owned homes are

78 | MARCH / APRIL 2020 • MHINSIDER.COM

the reason that MH has been hailed for its ability to be run passively and why there have been so many independently owned communities. If a resident owns their home, it is their responsibility to maintain it. As such, all the community owner must do is maintain the land and common areas —a much easier feat when compared to other forms of multi-family housing.

However, much of the passiveness of the MH industry changed due to the last recession and the fallout of chattel lending, as well as the increase

in customers who no longer want to own. Those chattel lenders were replaced by recourse (to community owners) lending that had not been seen since the early 1970s. These changes, among others, including attrition outpacing sales, has had the net effect of dramatically increased vacancy rates. This pivoted our passive model into one with varying degrees of reliance home rental, in some cases completely replacing the sales model.

The impact of this business model shift cannot be understated, as it changed the entire landscape of the industry. In the past, bringing in and selling a new home was simple and there was little liability on the community owner. With recourse loans and/or the addition of rental homes, the liability never leaves the community owner as they have a stake in the success and/or failure of their residents.

In simple terms, this business model shift has made the operation

of the MH community much more important and labor intensive. Here are some considerations and best practices that community owners and operators should consider adopting to ensure they are making the most out of their asset.

Understanding that the Land in MHCs are the Most Important Asset Operating a community is like operating a small town and all the town’s utilities and infrastructure are your

concern. If you already are or plan on renting homes, that brings another layer of commitment into the picture, as you no longer are just a landlord of a land-lease community but now have responsibilities that are similar to those at an apartment complex or other standard multi-family settings.

Roadways are another key part of every community and one of the first things to be put off when times get tough and cash flow slows. Even if a community has all homeowners, those homeowners still pay for the Âť

MHINSIDER.COM • MARCH / APRIL 2020 | 79

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maintenance and upkeep of the community. And upkeep of roadways are always a primary resident concern.

As time goes on without maintenance, the more expensive roadway repairs become. Asphalt roads are the more popular option with communities as they are much cheaper than concrete

These results pivoted

master meter volume and 95% of the master meter charge amount. If your property is not meeting these goals, a good course of action would be to compare your re-billing rates and the potential for leaks. Remember, the rates you pay will go up periodically and those increased charges should be passed on to your residents. Make sure to always compare master meter usage to resident usage, often this is the only way to identify leaks in your system.

our passive model into one with varying degrees of reliance home rental, in some cases completely replacing the sales model.

–Steven Blank

(especially when it comes to repairs), but they are not nearly as durable. If your community has asphalt roads, the best bet is to continuously invest in them, by crack sealing, seal coating and pothole filling. The key here is to ensure that the base of the roads maintain their integrity. Because once the base is damaged, all bets are off about their longevity.

Utility Sub-billing The place that we constantly see the most money left on the table is with water and sewer billing and re-billing.

Many communities have a master meter that bills for all the water and corresponding sewer charges associated with the property, providing the ability to bill back those amounts to residents. What we see most often is under billing. A well-run community should be rebilling at least 90% of the 80 | MARCH / APRIL 2020 • MHINSIDER.COM

Have a Documented Operating System Good operators have documented processes and procedures that explain how to perform each job a community/ field employee conducts on a day-today basis and ensures the community staff is supported through an active supervisor and up-to-date technology. One process that is followed by all is imperative when operating multiple properties.

Many operators make the mistake of becoming overly reliant on their community managers in that they expect the managers to be able to handle anything and everything from the ground floor up. As a result, managers (sometimes the only individuals whom residents see) are not provided with adequate training and support from corporate staff, many of whom lack refined industry knowledge.

It can be a recipe for disaster.

Remember, this business is not like running other forms of residential property. Employing corporate staff with MHC experience is a necessity.

The areas of operations that will yield the most to your bottom line are: • Billing and collections • Operating community office and staff • Communication with residents • Community curb appeal • Resident relations and rule enforcement • Compliance • Sales, leasing, and marketing vide value. Residents today have more options than ever because of technology that allows them to rate, shop, or research community reputation with a smartphone and a Google search.

You cannot operate an efficient and profitable portfolio at scale without a good value proposition and the best way to do this is by understanding the wants, needs, and expectations of your residents and then meet (or surpass) those expectations.

The best recipe to ensure that this is accomplished is by maintaining all common areas and infrastructure at your property, and having a team in place that can deliver the product and service that your operating system is meant to create. MHV Steven Blank is the president of Blank Family Communities, a third-part y management group in the Midwest, with 10 years of MH owner/ operator experience and membership in the MMHA. He has a bachelor’s degree

Add Value to your Residents

from Oakland University in industrial/

Ultimately, we are here to provide affordable housing to our residents and the key piece of affordability is to pro-

organizational psychology and is the creator of the Blank Operating Method.

WWW.MONROE-GIORDANO.COM TEL (813) 229-5055 • FAX (813) 229-5363 777 S. Harbour Island Blvd., Suite 140, Tampa, FL 33602

COMMUNIT Y

Preparing Positioning Your Park & Pocket for Rent Control

by Kevan Enger

82 | MARCH / APRIL 2020 • MHINSIDER.COM

COMMUNIT Y

T

he rent control movement is gaining ground across the manufactured home community landscape.

Once just focused on the multi-family sector, the affordable housing crisis and the recent rental increases by corporate mobile home community buyers has prompted a much-publicized outcry. This outcry has spurred grassroots resident movements that have grown to fuel political soapboxes and legislative bills in the fight for the vote and the dollar. Cities and states across the country have begun moving from just talking about rent control in manufactured housing communities to implementing it. In this article, we will take a closer look at how we got here and how you can prepare for and better position your community, your residents, and your pocket for the possibility of rent control.

How We Got Here The affordable housing crisis has hit an all-time high. No state has an adequate supply of affordable rental housing for the lowest-income renters. It is estimated that nearly 38 million households nationwide, or 31.5% of all households, are cost-burdened by housing--meaning they pay more than 30% of their income on housing.

That 38 million is comprised of approximately 20.5 million renters and 17.3 million homeowners who continue to face unaffordable rents. That’s a near-record share of renters — 47.4% — and in the country’s hottest markers, even higher-income renters are being challenged by record rents and unaffordability.

Even more striking is that more than 18 million households are considered severely cost-burdened with more than half of their income going to housing. When we break it down, the numbers are revealing.

• A pproximately 9.5 million renters and 5.4 million homeowners earn less than $30,000 a year In the severely cost-burdened category, we have: • 1.1 million homeowners and 927,000 renters earning between $30,000 and $44,900 • 7 31,000 homeowners earning between $45,000 and $74,999 Why is this happening?

One of the reasons for this trend is that rising rents and home prices are growing faster than income. According to a Harvard study, rents grew another 3.6% in 2018, and after adjusting for inflation, home prices were near their highest levels since 1980.

On top of that, since 2011, the stock of low-cost rentals has shrunk by a remarkable four million units, including a million in 2017 alone.

This affordable housing crisis is what fueled the gold rush to the manufactured home sector in the first place, bringing in corporate and independent buyers eager to get a piece of the affordable housing pie.

As the acquisitions and consolidation ripple across the sector, many of the new owners took advantage of the untapped upside (in the form of below-market rents) and were quick to raise rental rates to achieve market levels. The backlash from residents was swift, and it became a talking point for politicians, municipal officials, and governments agencies. All levels of the political spectrum became reinvigorated on the topic. There has been no turning back from the upheaval since, as the rent control conversation has gained momentum and is spreading across the country.

…closer-to-market rents will increase the value of your property, provide additional revenue to make improvements to your community…

–Kevan Enger

The Implications The pros and cons of rent control are being disputed everywhere. To do the topic justice and to fully explore the implications at the micro and macro levels, we need a separate and dedicated article. What we will explore on this occasion is the topline, short-term potential impact of the trend itself on the sector and how that could affect current owners.

Notoriety Could Lead to Less Investment: From Bernie Sanders to local council folk, affordable housing and rent control are hot topics. Whether you agree with it or not, this is one of those issues that has the potential to grow » MHINSIDER.COM • MARCH / APRIL 2020 | 83

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in notoriety, especially if there are more high-profile disputes over rent hikes. The implications of this are that notoriety adds fuel to the rent control fire, limiting upside for current owners and potential investors in both value and rents. As a result, some of the more sophisticated new owners are realizing that drawing attention to the topic as a result of dramatic increases in rents upon acquisition is not the way to go.

Flight Could Create Less Supply: Ironically, upside limits in the form of rent control could lead to flight by potential investors and developers, thereby possibly exacerbating the affordable housing crisis. Why? • Decreased interest from investors would result in waning demand as investors seek opportunities with higher returns.

• Diminishing demand also would decrease the value of existing parks for current owners and decrease supply as interest in park development would dry out.

• L ess supply would lead back to higher prices for residents, thereby exacerbating the original problem rent control was supposed to solve.

So What Now? The good news is that overall, it is still a seller’s market. There is still time to take the bull by the horns and take strategic action for better positioning if rent control does come your way.

Get Involved: There is a saying that goes, “If you’re not at the table, you’re on the menu.” With that in mind, get involved in your local manufactured home association and your municipality’s economic development groups.

Make sure you have a seat at the table and your voice is heard on the topic of

rent control as well as other issues affecting the manufactured home sector.

Know Your Rent Comps: Now more than ever, knowing your rent comps is essential. This will allow you to see how much room your rates have to grow. You can then begin a gradual process of reasonable increases to leverage existing upside in your favor while protecting your residents from larger and more dramatic increases in the future.

In addition, closer-to-market rents will increase the value of your property, provide additional revenue to make improvements to your community, and allow you to achieve a better sales price when you’re ready to sell.

Get a Broker Opinion of Value: This is the time to get a broker opinion of value (BOV) on your property from an experienced seller-focused broker. A BOV will tell you the potential value and sales price of your property. In addition, I also provide sellers information on market rents and make recommendations on how they can increase the value of their property, and thus, their return. This will help you get a complete picture of the opportunity at hand.

These strategic pre-emptive actions will help you better prepare and position your park, residents, and pocket for the possibility of rent control. MHV Kevan Enger is a pa r t n e r a n d m a nu fa c t u red h ou s i n g director for Capstone MH. He specializes in helping mobile and manufactured home park property owners position, market, and sell their properties to maximize returns.

Call him at (407) 494-8541 to discuss current listings or to determine if now is the time to sell.

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SALES

CHANGING OUR IMAGE... and the Power of Retail

by John Ace Underwood

H

Here are some facts that we in the factory-built housing industry simply cannot escape.

First, we have never built a better-looking product. One only has to tour the homes at our trade shows to know this.

Second, we literally OWN the words “affordable housing”.

No one fills the American Dream of homeownership for less than we do.

The question that begs to be asked is why, then, do we still only represent 10% of all new housing starts? For the moment, setting aside the most common answers, which is the availability of financing and zoning, and all that these entail, let’s look at the impact that our image has on this percentage.

Few would argue that our industry suffers greatly from the perception the general public has of us and the homes we offer. All too often we look to manufacturers, or national and state associations to address this problem. In doing so, those who retail manufactured homes, be that on dealerships or in communities, fail to recognize the power they have in forming public perception and general opinion.

Everything the manufacturer builds into their homes in terms of quality and structural integrity must be communicated to the customer by the retailer and its sales team.

Otherwise, the consumer will be unable to see the value.

All of the options and upgrades a manufacturer offers to make their homes look spectacular can be entirely negated at the retail level.

A highly effective retailer, a great product presentation by one enthusiastic salesperson, can sell homes that may not »

86 | MARCH / APRIL 2020 • MHINSIDER.COM

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MHINSIDER.COM • MARCH / APRIL 2020 | 87

SALES

have all of the quality features their higher-priced cousins may include.

What about the availability of financing? Financing is a supply and demand issue, pure and simple. There is an endless pool of money chasing higher yields. We can’t control the lender and where they put their money. We can only control the people we market and sell to. In order to sell more homes, we have to attract more ready and able homebuyers, and once we attract them, we have to offer a better customer experience if we expect them to be willing to buy.

Everything our industry does depends entirely on what happens when a prospective buyer comes in contact with our industry in any way.

We have to identify, understand, and control each and every one of these touch points.

To identify and control these touch points, we have to look at the journey a prospective buyer takes through the process of engaging with our industry.

We have to start where they start.

The Web Lead According to marketing data, 96% of potential homebuyers begin their shopping experience using the internet. Therefore, your website is quite likely one of the first touch points.

How well is your website performing? How would you know? Simply, if your website is not generating more leads than your team can handle, there is something wrong with your website and/or your marketing strategy. You’re losing sales.

The Phone Lead The second touchpoint of the customer experience is when a lead or an inquiry is generated by your website or any of your other lead sources.

88 | MARCH / APRIL 2020 • MHINSIDER.COM

Who responds to that internet lead and what do they say? How long does it take? When are incoming sales calls being answered and by whom? If you don’t really know, meaning you’ve set expectations and measure against those standards, you’re losing sales.

I had a client with a significant number of locations who was getting literally thousands of internet leads and just as many inbound sales calls every month.

Fact: A great customer experience can often compensate for a lesser product, but even the best product cannot compensate for a poor customer experience.

My client fully believed that at least 85-90% of the calls were being effectively processed. Upon closer examination, we discovered the salespeople were answering the inbound sales 1-800 number less than 44% of the time on average, less than 29% in the worst cases and only 62% of the time at the best location, with the rest going to voicemail. What impression might remain with the potential homeowner given this scenario?

If the phone isn’t being answered, what do you think happens to inter-

net leads? How likely is it that your salespeople are tuned into voicemail and are returning calls expeditiously?

Again, if the performance is akin to the rate a ringing phone is answered, what impression does this make?

The New Lead in Person Let’s assume the website generated a lead, and the sales professional reached out to the contact and set an appointment to visit your sales center or community. When the customer arrives, does the customer experience pass the test of those customers you’re trying to attract? What impression do they have when they leave?

Chances are, the customer experience you provide appeals to those customers to whom you are selling but it may not appeal to the ones you could be selling.

If you also want to attract, capture, and sell a better-quality homebuyer, assess your marketing strategy, your sales process, your collateral material, the way in which your homes are displayed, your signage, and the appearance of your display center. All of these are part of your image and make a statement as to who you are and how you conduct business. All of these have a monumental impact on whom you sell homes to and how many homes you sell.

Based on my experience, you’re already being contacted by those additional prospects, you’re just not converting them. Understand this fully… you’re likely already being contacted by the people who will buy the additional homes you want to sell or the spaces you want to fill.

I’ve addressed just a few of the issues that could be lowering your corporate image and could be costing you additional sales. Which of these

SALES

can be resolved at the factory? How many of these can be eliminated by getting better financing? In contrast, how many of these do YOU control?

This is the power you have.

You quite literally have the power not only to increase your sales and grow your organization, but in doing so, changing the public perception of our industry as a whole.

The hardest business to measure is the business you lose. People don’t call you and tell you where, when, and how

you dropped the ball. They just buy or move somewhere else. The only defense against losing the business you could, and therefore should be closing, is to consider your overall customer experience and never, ever give your prospects a reason not to buy. That’s how you grow your company and that’s how we will change the image of our industry. MHV John Ace Underwood is a 30+ year

sales management process implementation, and leadership development.

He has worked with hundreds of retailers, manufacturers, and communities, and is a frequent presenter at state and national industry associations.

For a Business P rocess Assessment, contact him at (520) 241-9907 or e-mail: johna-

veteran of the factory-built housing

ceunderwood@

industry, focusing on marketing, sales/

gmail.com.

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MHINSIDER.COM • MARCH / APRIL 2020 | 89

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SALES

It’s the little things that are vital.

Little things make big things happen!

–John Wooden

SIMPLE Community

Home Sales Tips

by Ken Corbin

L

Let’s be honest. The primary focus of a community

manager is just that: managing the community. With that in mind, here are a few simple tips to make your “sales” life a bit easier.

92 | MARCH / APRIL 2020 • MHINSIDER.COM

SALES

Photos courtesy of Tharakan Consulting

Back Doors, Smoke Detectors, and Commodes 1. R emove the handle on the back door of your models and replace it with a double-keyed deadbolt lock.

This way, there’s no handle on either the inside or the outside and you NEVER have to remember to lock the back doors at the end of the day. It’s also a great way to avoid having anyone open the back door and perhaps fall and hurt themselves. Finally, put a nicely framed graphic on the inside of the back door with a note that simply says “NO EXIT” 2. Smoke detectors that are constantly beeping while you’re showing your homes to customers are a major distraction. Even if you take out the batteries, they’re hard-wired into the system. They can easily be discharged after the batteries are removed. This stops the irritating beeps. Talk to your manufacturer and they’ll tell you how to do this for your brand of detector.

Of course, it’s important that you recharge them and replace the batteries when the model is sold.

3. Use quality tape when securing the lids on all of your commodes. A simple note, on top, that says “Please

Use Office Restrooms” will generally work. Of course, also make sure the note is securely taped down to the lid. Many communities simply put a nicely tied bow around the bowl of the commode. It’s a simple way to say, “Sorry, I’m not available.”

4. I f you handle more than one manufacturer, or your current plant changes door suppliers, you’ll likely be stuck with multiple master keys. This can be a real pain during wet or cold weather, trying to find the right key to open the doors. To help minimize your frustration, here are a couple of suggestions:

a. If you only have two types of locks, place a small, round color-coded label at the door handle that corresponds with the labeled key.

b. T he other choice, especially if you have more than two different types of homes, is to have all the locks keyed to be identical. It’s a small expense with a local locksmith that will pay for itself many times over. »

MHINSIDER.COM • MARCH / APRIL 2020 | 93

Kitchens and Baths One of the most frustrating things I see when touring models in a community or a sales center is how they’ve lacked finishing the two most important rooms in the home – kitchens and baths.

If someone is going to invest in quality appliances, they’ll want to open the doors and easily see the inside.

It’s amazing how many companies fail to even remove the tape that secures the doors shut on appliances. Even if that part has been done, I see my share of packing materials left inside the appliances including refrigerators, ranges, microwaves, and dishwashers.

Remove all of the marketing, warranty items, and notices that are in the kitchen and bath drawers. They add absolutely no value and are nothing more than a distraction. Don’t forget all the rubber bands on cabinets and drawers.

Obviously, you’ll not remove any required governmental notices, but everything else need to go! Package it all in a box with the model number labeled and stored away until the home is sold.

Doors and Windows Remove virtually all of the stickers off the doors and windows, leaving only one on each. If you’re reading this at home, look around.

Are all the stickers that originally came with your windows and doors still on there? Of course, not! If your car was purchased new, is the window sticker still there? No, and it probably was removed the day you bought the car.

There’s no “value” in leaving the stickers and shipping materials in place. I do, however, recommend you leave one on both doors and one prominent window as a tool when you’re feature/benefiting the home.

It’s rare your competitor will ever spend any time discussing what those numbers are for, probably because they have no idea of exactly what they truly mean.

Well, let’s be honest. The first time you are reading or hearing this, you probably don’t know either... But now’s a great time to add more positives to your simple selling scale. MHV Industry consultant Ken Corbin has worked with over 800 communities, retailers, associations, and manufacturers. He’s also co-facilitator of the MH20 Group. For more information, e-mail: ken@callkencorbin.com.

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MHINSIDER.COM • MARCH / APRIL 2020 | 95

continued from page 98

THE ALLEN LEGAC Y

owners/operators of land-lease communities throughout North America. But prior to applying that apropos property label, terminology had to evolve from trailer camp to mobile home park to manufactured home community. Also during this time Gub Mix, association director in three western states, hosted the first Manufactured Housing Congress – continuing to this day, as an annual MHI event.

MHI’s Manufactured Housing Educational Institute (MHEI) launched

1996 to form the National Communities Council (NCC), now a division of MHI. This same year, David Helfand, former CEO of REITs Equity LifeStyle Properties and ARC, suggested the term owners/operators be used to describe the breadth of ownership and management of 50,000+/- communities comprising this unique income-producing property type.

In 1998 we saw 372,943+/- new HUD-code homes shipped, a sort of mini-renaissance for the industry; one in which so-called Developer Series

Photo courtesy of Tharakan Consulting

the Accredited Community Manager (ACM) training program in 1991. And in 1992, the first Industry Standard Chart of Operating Expenses, and related Operating Expense Ratios (OERs) made their appearance, just in time for the Real Estate Investment Trust (REIT) wave of 1994 and 1995.

But not before now-retired Martin Newby, of Newby Management, formalized the concept and processes for resident relations within the realty asset class, which in turn, took steps in 96 | MARCH / APRIL 2020 • MHINSIDER.COM

Homes (think “big box = big bucks”) were all the rage for a short while.

And during the same year, the ABC classification of MHCommunities methodology replaced the long defunct, since 1976, Woodall STAR system of property quality measurement and reporting.

During 2001, the Manufactured Housing Manager (MHM) professional property management and certification program was launched after a 13-year hiatus. The following

year, as the shipments of new HUDcode homes started to tank, “Be a stud, sell a HUD!” became the widespread rallying call for the industry.

In year 2009, the industry’s nadir shipment year, Community Series Homes materialized during a meeting of 100+ HUD-code housing manufacturers and community owners, at the RV/MH Hall of Fame in Elkhart, Ind. Landscape and community design consultant Don Westphal suggested during the International Networking Roundtable later that year the CSH name. And that same year, George Porter, following a personal epiphany related to installation standards, researched, codified, and introduced frost-free foundations to the manufactured housing industry.

During this same period, when the industry was struggling to survive, the term “hudular” enjoyed short-term popularity, describing new homes easily fabricated to manufactured or modular building codes.

A year later, some common trade terms underwent significant change.

Rental homesite, or just plain homesite, replaced lot, pad, space, and stall in the minds of many. Transporter replaced toter. And homeowner/site lessee, rather than tenant or resident, clearly labeled the unique homeownership/ ground-lease status of those living in land-lease communities. During 2011, longtime industry consultant William Carr popularized the terms independent (street) MHRetailer and company stores, supplanting the trite term “dealer”.

While land-lease communities, as a contemporary label, has been mentioned a couple times in this evolution of trade terminology, it wasn’t until 2012 it achieved formal status.

Why? Well, no longer are just mobile

THE ALLEN LEGAC Y

homes and manufactured homes sited therein, but now also modular homes, park model RVs, RVs for a season, stick-built homes fabricated on-site to imitate manufactured homes, and most recently, various types of accessory swelling units (ADUs) and tiny homes.

During 2018, the National Association of Manufactured Housing Community Owners (NAMHCO) was formed to lobby nationally on behalf of land-lease communities of all sizes, an especially timely and important initiative given the recent threat of national rent control.

Finally, we currently are experiencing a rush of new trade terms within the housing manufacturing segment of the industry. Think CrossMod or “new type” manufactured homes, per MHI, produced for Fannie Mae’s

MH Advantage® and Freddie Mac’s CHOICEHomeSM real estate-secured finance programs. In the meantime, land-lease community owners/operators selling, and seller-financing of new HUD-code homes on site, relied on cash transactions, lease options and leasing of homes as rental units have occurred as they anxiously await Duty to Serve (DTS) programs at both GSEs (Government Sponsored Enterprises) to make personal property financing (chattel capital) once again available for home-only loans within properties, and loans on the secondary market.

So, what will the next decade hold for us relative to evolving trade terminology? Well, that’s anyone’s guess.

But asking me, I’ll be bold and say most of our new HUD-code home sales will come from polar ends of the pricing spectrum — the high end

(via GSE DTS programs) and low end (within land-lease communities), with little else between. And communities per se? I Don’t see much change there, unless it becomes, once again, easy to develop raw land into new landlease communities for affordable housing. And, we successfully fend off present day efforts to effect national rent control. MHV George Allen has owned and fee-managed land-lease communities since 1978.

He’s a former MHI Industry Person of the Year and a member of the RV/MH Hall of Fame. He has been designated a Certified Property Manager-Emeritus and a Manufactured Housing Manager-Master. He’s also a senior consultant and staff writer with EducateMHC. Allen can be reached at (317) 346-7156 and gfa7156@aol.com.

MHINSIDER.COM • MARCH / APRIL 2020 | 97

THE ALLEN LEGAC Y

Do You Know MH Lingo?

By George Allen, CPM Emeritus, MHM-Master

M

y ea rliest memor y of mobile housing occurred when I was 5 years of age, living in southern New Jersey.

On the way home from the shore one summer evening we stopped for gas. While there, a half dozen or so small house-like trailers pulled off into the woods across the street from the service station, and their owners started hacking down brush and small trees. I asked my father what was going on and he said, “Oh, they’re making a trailer camp for the night or

maybe next couple days.” That was 70 years ago, and much has changed, especially housing trade terminology.

One of the earliest and most persistent trade terms, extending back 50 years, has been “D&R deliveries”. Ever since the early 1970s, our industry has been known, sad to say, for this style of drop and run for new trailers, mobile homes, and manufactured homes. And 1974-1976 is when HUD code and manufactured housing replaced mobile homes. And in the same timeframe, “syndicators” of mobile home park limited partnerships

ushered in the initial consolidation of individual properties into portfolios.

During the early 1980s, “newly wed and that nearly dead” became the truism describing folk buying mobile homes, then and now. In 1985, as the term manufactured housing became increasingly commonplace, the Manufactured Housing Association for Regulatory Reform (MHARR) was birthed by a former executive and members of the Manufactured Housing Institute (MHI).

The ALLEN REPORT debuted in 1989, today identifying 500+/- portfolio continued on page 96

98 | MARCH / APRIL 2020 • MHINSIDER.COM

REDEFINING VALUE FOR THE MH/RV ASSET CLASS BROKERAGE & ADVISORY SERVICES  CLIENT

FOCUSED

 DRIVEN

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Christopher Nortley President | CEO (586) 884-8416 chris@mhreinc.com

RESULTS

Colleen Lannoo Melissa Wade Broker Associate | Senior Transaction Director of Data Research Manger (586) 580-7322 (586) 884-8415 colleen@mhreinc.com melissa@mhreinc.com

Richard Zicker Senior Advisor (407) 640-7044 richard@mhreinc.com

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Detroit HQ Location 12900 Hall Road, Suite 190 Sterling Heights, MI 48313

Michel Mikkola Senior Advisor (407) 640-7046 michel@mhreinc.com

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Melanie Ng Senior Analyst | Sales Associate melanie@mhreinc.com

www.mhreinc.com

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