Another positive industry article – and from Vermont, no less. What would Bernie Sanders say (particularly if you didn’t pay him to say it)?

If you own a mobile home park in Delaware, it’s apparently time to start calling land brokers to get your parcel on the market for a better use. The folks that run Delaware are clearly nuts.

BRADENTON BEACH – In a Jan. 27 letter to the Pines Trailer Park Homeowners Association (HOA), Pines Park Investors LLC offered to sell the mobile home park to the residents for $75 million. At that price, each of the 86 mobile homeowners would be responsible for $872,093.02.

To make this mobile home park worth $872,093 per lot, at a 6% cap rate, would require a monthly lot rent of around $8,000 per month. That’s probably not going to work. Some mobile home parks can’t make sense continuing in that capacity regardless of how high you raise the lot rent.

“We evaluate special-use permits, if they are allowable by the town,” Borisenok told the audience, some of whom tried to shout him down calling him a “coward” and a “liar.” “We do subdivisions, site plan approval. That’s what we do here.”

Yes, and another park bites the dust. Is anyone paying attention here? Only higher lot rents stop redevelopment. Once again, in this case, the lot rents simply weren’t high enough.

Residents were ordered to leave the mobile home park in Sweetwater, Florida, when its management company, CREI Holdings, announced plans to redevelop the site into government-subsidized affordable housing, displacing nearly 6,000 residents across 900 homes. Notices were issued in October 2024, giving residents until May 19 to make alternative living arrangements, a move many residents and legal experts argue violates Florida’s landlord-tenant statutes. 

Yes, even non-profits have figured out that mobile home parks make for GREAT redevelopment parcels. Once again, these 6,000 residents could have been saved from all of this if the lot rents had been high enough to make it the best use of the land. They failed.

Mellissa Finch, who inherited the park after her mother’s passing in 2024, said the reason for the rent increase is property taxes have been raised from $4,400 to $37,000 and insurance prices have risen.

Oh, I see how it is. The property taxes go up by 1,000% and the park owner is just supposed to shrug that off. Instead of complaining to the park owner, why not complain to the tax assessor.

As for the potential for homelessness here, it’s not the lot rent increasing that’s the risk, it’s probably going to be Ms. Finch realizing how much more this parcel is worth in a different use. That’s going to come to her soon enough as the tenants deliberately create so much mental anxiety that there will soon come an offer from a developer and she’ll quickly agree.

This article is wrong on so many counts:

• The false assertion that lot rent of $1,000 per month in Albuquerque is “horribly high” when the average apartment rent in Albuquerque is $1,708 per month and the average single-family home is priced at $308,000. When mobile home park lot rents are 40% lower than apartments and 80% less than the single-family home mortgage and taxes, it would seem to me that mobile home park lot rents are actually very low NOT high.
• The false claim that corporate owners somehow lead to lower property condition when, in fact, they are well-known to inject million of dollars into large properties, such as this one, to bring infrastructure and cosmetics back to life – something that former mom and pop owners often let deteriorate over the decades and have no money to fix.
• The false concept that residents are having to cut back on prescription drugs and food solely as a result of higher mobile home park lot rents. As you may be aware, while all prices in the U.S. rose roughly 20% during the disastrous Biden administration, food alone is the fastest inflating commodity. On top of that, housing is only the fifth largest cost for Americans, eclipsed by health insurance, childcare, transportation and taxation. Those have risen faster than mobile home park lot rents and it’s beyond ridiculous to pretend that somehow only the mobile home park lot rent is the culprit of people being broke.
• The false narrative that somehow tenants could buy parks and lower the lot rents. Since the bulk of the cost would be to service the debt – at the exact same price as a corporate owner – plus utilities, insurance, property taxes and repairs that would all be the same regardless of ownership, the truth is that tenants pay the exact same amount no matter who the buyer is.

While the writer of this article may think that you are dumb enough that they can convince you that 2+2 = 5, hopefully they failed.

A concept plan by WithersRavenel dated Oct. 2 showed 90 townhomes and 328 multi-family units on 27 acres at 607 Cedar St., which is the mobile home park’s address.

Clearly, being able to replace around 270 mobile home park lots that rent for $400 per month with 90 townhomes and 328 apartments that will rent for around $2,000 per month is a no-brainer financially. And this is the story for most of the mobile home parks in the U.S. in the years ahead. As I’ve been writing about for years now, mobile home parks make ideal redevelopment parcels as they have 1) great locations 2) great road frontage 3) access to all utilities 4) the correct acreage size and 5) the city is willing to give out whatever permits you need to get the park torn down. The sooner that people understand this, the better. Owners are not stuck with mobile home parks as their only option, and only higher lot rents will fend off the wrecking ball. In this case, the lot rents simply weren’t high enough.

What are they smoking at Sedona city hall? The state has a law that says that mobile home parks allow short term rentals. The City of Sedona apparently doesn’t care what the law says. So they found some woke judge that hates the Republican-led state fathers so much that they will rule against anything they say. Now it gets appealed and the judge’s ruling gets tossed. What a waste of taxpayer funds. Pitiful.

The cooperative did have to increase some land rents to have enough revenue to pay off interest from its loans, said David Stouder, who serves as the board’s operation manager. Land rents, which formerly ranged somewhere between $780 and $995 per month, will now be $960 per month for all residents, he said.

So the residents had to raise the rent – on day one – from $780 to $960 per month? That’s compared to the $50 or so raise the corporate owner was proposing. Yeah, that’s a pretty big success … having the rent go up nearly $200 per month right out of the chute. It’s bizarre that they aren’t embarrassed to tell this tale.

But that’s not nearly embarrassing enough. Up to bat next will come the park falling apart as the tenant managers will fail to collect rent or enforce rules on their friends as well as never being able to raise additional capital to make repairs. Maybe these folks haven’t head about the other great tenant buyout of the Sans Souci Park, also in Colorado. Read this article when you have a chance.

Great article. Fair and balanced. I’m impressed.

While I disagree with the premise that mobile home parks are best served by resident ownership (which I have discussed in detail every week) the article explores more than that one item and concludes that mobile home parks are important for the community and should be saved from redevelopment by perhaps having the state/county/city gift the necessary infrastructure repair that many older parks face, as well as to help residents obtain the funds to buy them, when possible.

Once again, overall, a favorable article for the industry.

No surprise for anyone who reads this weekly missive, as I have been writing for years about the fact that mobile home parks are perfect for redevelopment as they have great locations on major roads, access to water and sewer, and are just the right amount of acreage for most uses.

If lot rents don’t go up substantially, many mobile home parks will be redeveloped in the years ahead.

They better hope that large, well-funded groups keep buying these mobile home parks as they are the only people who have the capital to fix the flooding issues in North Carolina that FEMA has no money to help with.

I’m impressed that there was no negativity to this article – that’s refreshing.

I have no idea how anyone in Pacific Palisades can ever overcome everything that has happened there, but just the fact that there were mobile home parks in such a prestigious area elevates most American’s opinion of the mobile home park product.

It’s strange that they would be that concerned about a storm shelter in an area that rarely has a storm but it’s nice that the city is FEMA is gifting $70,000 to a mobile home park for this project.

In addition to acquiring assets, Group Fund II is making renovations to properties, which includes improving infrastructure, bolstering amenities and common areas, paving and landscaping, as well as implementing new affordable homes. GMF, which has invested almost $30 million in its MHCs portfolio, hopes that these moves will provide a boost in value for both residents and investors.

Once again, I’m impressed that this writer, rather than advance the false narrative that “private equity groups make evil landlords”, instead told the truth that these well-capitalized buyers are the ones that have the money to bring old mobile home parks back to life.

Residents of the Woodland Estates Mobile Home Community learned about the park’s rezoning last year after the park owner reached an agreement with Core5 Industrial Properties, which filed plans to build 1.2 million square feet of warehouses on the property.

And another park bites the dust. Seeing a trend here? Guess why? The lot rents were too low to beat out the industrial redevelopment option.

The mobile home park — already listed as “permanently closed” online and no longer accepting new tenants — is slated to be redeveloped into a 90-unit apartment complex in the next few years, eliminating one of the most-affordable housing options in the city. Average rent in Meridian is almost $1,500 a month, according to Apartment List, while residents on the 40 lots in Elm Grove own their homes and pay $590 a month.

And here’s another park closing for redevelopment. People who don’t own parks have no idea how strong the demand is for redeveloping the land they sit on. The typical mobile home park has a strong suburban location with great frontage and access to all utilities, which is perfect for apartments. And, as the writer duly notes, 90 apartment units at $1,500 per month is a whole lot more revenue than 40 lots at $590 per month. But the existing park didn’t need millions of dollars in construction capital and interest costs and there probably was a lot rent number that could have saved it. Was it $700? $750? Somebody should have asked when the first hint was given that the park might sell. Instead, the park is yet another victim of greener pastures and an escape from criticism.

The management team is concerned about the long-term viability of the park.“The cumulative impact of delinquency, loss of units, and the need for significant investments makes it clear that the park’s current model is no longer feasible," the letter said.

Most residents – and certainly the media – don’t seem to realize that a mobile home park is a business, just like any other form of commercial real estate. Any business that does not make money ultimately shuts down. And any use of land that has a more profitable replacement will ultimately be redeveloped. In so many of these articles the attitude is that the mobile home park owner is somehow a governmental non-profit. They’re not. Nor did they ever ask to be.

The city of Boise announced Tuesday the receipt of $6.7 million to be dedicated to its affordable housing goals. The award comes from the U.S. Department of Housing and Urban Development (HUD), with Boise being one of 17 nationwide recipients that will dedicate the funds to “maintain, protect and stabilize affordable hosing,” a news release from the city said. Boise’s award will be used to preserve and maintain the Sage Mobile Home Park, a 2-acre mobile home park on the Boise Bench that houses 26 families and was originally purchased by the city in 2022.

This is so stupid that it would make Gavin Newsom jealous. Boise, Idaho is going to spend $6.7 million to upgrade a 26-space mobile home park? That’s over $250,000 per mobile home! You could literally give each resident a mortgage-free, 3 bed/two bath brick home on an acre of land as opposed to wasting a quarter million dollars per trailer. How is this kind of stuff even possible? Talk about government waste! But where I’m really lost is that this park is already owned by the City of Boise. So are they saying they let the park fall apart to the point that it will take $6.7 million to put it back in usable condition? Surely the writer has these numbers wrong.

Residents of a mobile home park in Bangor will be the second group in the state to purchase their community under a new Maine law. Residents of the Cedar Falls Mobile Home Park voted over the weekend to purchase their community for $8 million, using grants from Maine Housing and the city of Bangor, as well as loans from the Genesis Community Fund and a group of non-profits and banks led by Bangor Savings Bank.

Then, once the celebration is over, comes the ugly reality that they have an $8 million mortgage to service every month using their meager collections and untold maintenance surprises, all falling on a group of people who have never successfully managed anything in their entire lives. Kind of sounds like the Biden administration, right? With the same ending, no doubt.

A nonprofit that helps mobile home park residents create owner cooperatives is looking for land for a new park.
A private donor gave the Cooperative Development Institute $50,000 to jump-start the project, which is expected to cost millions of dollars and take years to complete.

Only an academic would be excited about a $50,000 donation to fund a study of a multi-million-dollar project. They will no doubt use the $50,000 for a feasibility study that will tell them – no matter what the truth is – that the concept of building a new park is absolute genius. Then, with the $50,000 gone, they will spend years forming committees and having endless discussions. At some point, to justify their existence, they will start passing the hat to raise millions of dollars for the actual construction, which will quietly never be mentioned again when they top out the fundraising at maybe $100,000. In the end the donor might have been better off just burning the $50,000 and grilling a hot dog on it. At least there would be a nicely cooked hot dog to show for it.

According to Brown, “What it really came down to, for me, was that this is truly affordable housing that you can own…[and] when investors buy these parks, they raise the rents and don't improve the infrastructure [and] it leads to ongoing issues for the residents.”

I have some basic factual problems with this often repeated, but factually incorrect, statement that include:

1. When a park sells – whether to an investor or a non-profit – a giant mortgage is placed upon it. This requires a huge increase in rent to pay it off. Mom and pop could charge a tiny rent because they owned the park free and clear. So the only way that you can stop rents from going up, in the event of a park sale, would be for mom and pop to give the park away for free. Unlikely to happen.
2. An investor and non-profit both have to pay the exact same water rate, sewer rate, electric rate, trash fee, property tax, insurance premium, repair bills – every single line item on the P&L. As a result, they both have to charge the same rent to cover those costs.
3. If you read these articles every week, you will note that just last week the non-profit admitted that the tenants will be paying the same – or more – rent by buying the park themselves.
4. Investors are much better managers and stewards of a property than the residents are. The residents lack the discipline to file evictions, make tough choices on rent levels, and enforce the rules.
5. Professional investors, in fact, are the ONLY ones out there fixing aging park infrastructure and taking these old properties to the next level.
6. I am yet to see a single park in the United States, purchased by a professional investor, that is not far nicer now than when they bought it.  

Would a “working group” accept these factual statements? Never. Common sense is left at the door when these types of committees get together. But the facts are still the facts and even if just one person reads this and understands the truth now, then it was worthwhile writing this. We can’t allow these lies to continue.

Have you noticed that the follow-up footnotes to the “Shark Tank” cast hold nothing but bad endings? Mark Cuban revealed that he spent $20 million on start-ups during his decade on the show yet collectively never made any money from any of them. Meanwhile, Daymond John’s FUBU – his personal business – went down the drain. And then it was revealed that Barbara Corcoran was living in a mobile home in California, which now has burned to the ground.

I would recommend that people read actual biographies of real, successful investors going forward and steer clear of the televised “reality show” versions that are fictional at best and give about as much insight into successful entrepreneurial ventures as I could give on quantum physics.