Mon, Apr 10, 2017 – Residents of Corona La Linda attended their forty-fourth (44) City Council Meeting on Wed, Apr 5, 2017. The City Council have decided to defend Kort & Scott’s property rights and are suggesting the residents consider the most recent lease offers presented on Thu, Mar 30, 2017.
One of the City Council Members informed the residents that they must sign the lease by Mon, Apr 10, 2017 or the offer is off the table. The residents received their lease offers on Thu, Mar, 30, 2017 and have thirty (30) days to accept or reject the lease offer (Civil Code §798.17(b)(3)). Why would a City Council Member tell the residents that they only have until Mon, Apr 10, 2017? Something is amiss.
During the City Council Meeting, Mr. Eugene Montanez mentioned that he was going to be meeting with the residents of Corona La Linda MHP on Sat, Apr 8, 2017 to discuss the lease terms. The residents held an emergency CLLHOA meeting on Thu, Apr 6, 2017 and took a vote, they do not want to meet with Mr. Montanez after his comments at the recent City Council Meeting and the resident meeting was cancelled. The residents are now preparing to pursue this further with counsel and potentially with state officials.
The MHPHOA have reviewed the City Council Meeting numerous times. We have watched Mr. Eugene Montanez, Ms. Karen Spiegel and Mr. Dick Haley provide their commentary regarding the resident's situation. Based on those comments, the MHPHOA can only assume that these City Council Members have not read the 21-page lease agreement in its entirety. If they had, they would be advising the residents to not sign the leases and to seek legal counsel. Or, if they were like other "responsible" City Councils, they would be preparing to implement a Rent Stabilization Ordinance for the City of Corona to prevent this from happening in all of the mobile home parks in the city.
During commentary from Mr. Eugene Montanez, he suggested the audience focus on the negotiations that have taken place over the past year and a half. He revealed information we were not aware of regarding the initial planned space rent increases after Kort & Scott purchased the park in May 2015.
A year and a half ago they were talking $1,600 a month rent and then they went down to $1,200 then they went to $900 and then they actually went to $0.
Council Member Eugene Montanez
Our sources inform us that initially there was rumor that Kort & Scott were going to raise the space rents for new buyers from $650 to $1,300 per month. This is what caused the residents to organize and attend their first City Council Meeting. We had no idea that Kort & Scott were going to raise the space rents to $1,600, this according to Mr. Eugene Montanez who has been involved with the negotiations since the beginning.
Kort & Scott were going to raise the space rents in Corona La Linda from $650 to $1,600 per month. That should have been an immediate red flag for the City Council and preparations for an RSO should have begun in 2015. The City Council appear to have forgotten that there are fourteen (14) mobile home parks in the City of Corona representing 2,231 spaces or approximately 8,924 residents. All of these mobile home parks are faced with the potential of skyrocketing space rents due to the lack of protections in place, it has already happened at Corona West Mobile Home Estates which is also owned by Kort & Scott. Space rents are advertised at $1,300 per month. Green River Village owned by Hometown America are advertised at $1,035 per month.
Mr. Eugene Montanez stated during his commentary that the long-term leases provide the residents with some breathing room and the opportunity to move in the next 2-5 years. Here we have a City Council who has sided with the property owners (Kort & Scott) and is suggesting that these residents sign the leases and place themselves in economic servitude and to start preparing for the final outcome in 2-5 years.
The average space rents in Corona as of Dec 2016 were $663 per month. If we add in the space rents from the three (3) mobile home parks owned by predators ($950, $1,035, $1,300), the average increases to $755 per month. Based on the averages, the predatory park owners have increased space rents well beyond fair market value. The Corona City Council have made it clear that they will not offer any protections for the mobile home residents. The gist of the commentary from the City Council is they would rather have you prepare to move due to the increasing rents. If you can't afford to live in a Corona Mobile Home Park, move somewhere else.
The Thu, Mar 30, 2017 proposed Long-Term Lease Agreements from Sierra Corporate Management are 15 years at 7.0%, 20 years at 6.0% or 25 years with escalated annual rent increases starting at 3.5% or CPI, whichever is greater.
Shown below are ten (10) year forecasts based on Escalated 3.5%-5.0%, 3.0%, 5.0%, 6.0% and 7.0% annual space rent increases. At years 10 thru 25 we show just the Escalated Space Rent compared to a maximum 3.0% increase.
Sun, Mar 12, 2017 – On Wed, Mar 1, 2017, the residents of CLLHOA attended their forty-second (42) City Council Meeting in twenty-one (21) months seeking help from the Corona City Council.
Since Jun 2015, the residents have attended all City Council Meetings (twice monthly) and have staged over a dozen rallies protesting the City Council’s lack of action to help protect the residents from the predatory business practices of the new park owners, a Kort & Scott company doing business as Corona La Linda Associates LP, Corona La Linda GP LLC and Sierra Corporate Management Inc.
Some members of the Corona City Council have had a change of heart and are now supporting the resident’s attempts with Sierra Corporate Management to negotiate a 25-year long-term lease agreement with a maximum 3.0% annual increase.
Based on the City Council's comments during the meeting, it appears that Sierra Corporate Management have misled the Council Members regarding the particulars of the lease – first by Abraham Arrigotti, the previous President of SCM, and now by Richard K. Pinel, the current President.
On Thu, Mar 9, 2017, the Corona La Linda Homeowners Association received this email message from Richard K. Pinel, President of Sierra Corporate Management.
Our Long Term Lease has been delivered and as you more than likely recall, stands at 5% or CPI, whichever is greater (for the 25 year lease option).
The MHPHOA are expecting the Corona City Council Members to respond to the above reply from the SCM President during the Council Meeting on Wed, Mar 15, 2017. How much longer will the City Council allow this to continue? When will Council Members seriously consider a Mobile Home Park Rent Stabilization Ordinance for the City of Corona?
Wed, Oct 19, 2016 – Kort & Scott Financial Group purchased Corona La Linda Mobile Home Park in May 2015 for $16.7MM. Dixon, one of several previous landowners who agreed to the deal, said he felt forced to comply with the majority decision.
I have a feeling the new owners are about as aggressive as they can be. I personally feel terrible for having done the deal.
The Press Enterprise
It is now sixteen (16) months after purchase and here is a select timeline of events that have occurred.
Jun 2015 – Residents are informed through anonymous resources that the space rent for new buyers of mobile homes will be increased from $650 to $1,300 per month. Within a few days, a large percentage of the residents (100) organize and form a GSMOL Chapter for their mobile home park. One resident attends the first of many Corona City Council Meetings on behalf of those residents who organized.
Dec 2015 – A number of residents have attended multiple Corona City Council Meetings to voice their concerns about the proposed rent increase for new buyers along with the 20% rent increase for existing mobile home owners. City Council Members have been listening but little is being done to prevent what is happening. Residents are informed by the City Council that this is a private matter between the mobile home park owners and the residents. The residents do achieve a small victory during this time and the space rents for new buyers are reduced from $1,300 to $950 per month. Existing mobile home owners will receive a 20% increase in May 2016 from $650 to $780 on average.
Feb 2016 – The residents of Corona La Linda Homeowners Association (CLLHOA) stage one of many Rallies that are now held monthly, normally on Saturdays from 9:00-11:00 AM at 480 North Main Street in Corona, California 92880. Mobile home owners from various mobile home parks attend and show their support for a Rent Stabilization Ordinance (RSO) for the City of Corona mobile home parks.
Oct 2016 – The residents of CLLHOA have been diligent in their continued efforts to seek help from the Corona City Council. Since Jun 2015, the residents have attended thirty-three (33) Council meetings and have staged over a dozen Rallies protesting the City Council’s lack of action to help protect the residents from the predatory business practices of the new park owners, a Kort & Scott company doing business as Corona La Linda Associates LP, Corona La Linda GP LLC and Sierra Corporate Management Inc.
Since Kort & Scott purchased Corona La Linda (132 Spaces) in May 2015, there has been a turnover of nineteen (19) mobile home spaces and/or homes. That’s a 14% turnover in just sixteen (16) months. This type of “flipping” is not a normal occurrence in most mobile home parks.
The Corona City Council meets at 6:30 PM on the first and third Wednesdays of the month at the City Hall, Council Chamber, 400 South Vicentia Avenue, Corona, California 92882. Residents of CLLHOA will be attending the Wed, Oct 19, 2016 Corona City Council meeting and will be presenting further information and documentation to the City Council Members along with the residents’ continued pleas for help.
You can watch these meetings live on https://Corona.VieBit.com/. Links to previous City Council meeting videos are available. The MHPHOA also maintains a library of select Corona City Council meetings in the CLLHOA Media Library.
If you’re in the Corona area and would like to show your support for the mobile home owners in the City of Corona, you are welcome to attend the City Council Meetings. You can fill out a speaker card (3 minutes) and share your support of the residents with the Corona City Council.
Fri, Nov 22, 2019 –
Kabateck LLP attorneys representing hundreds of low-income mobile home residents in Long Beach, California secured a nearly $57 million settlement, which is the largest settlement ever involving a mobile home park.