Mobile Home Owner News – May 2023
Resident curated mobile home owners news and information for residents of Mobile Home Parks owned by Kort & Scott (KS) companies. The MHPHOA also provides news coverage for Mobile Home Parks not owned by KS companies.
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RE: Capitola, California / Cabrillo Mobilehome Estates / Vieira Enterprises Inc
Fri, May 26, 2023 –
The Capitola City Council voted unanimously Thursday to add mobile home rent stabilization measures to its municipal code just days before a steep increase in rental prices for residents of Cabrillo Mobile Home Estates Park were set to roll out.
The decision came after weeks of protest from residents of Cabrillo Mobile Home Estates Park who said that the park’s private owner had informed them that their rents would increase 56% from $641 to $1,000 beginning June 1, 2023 after expiration of an existing 12-year lease.
The ordinance, requiring a four-fifths majority, took immediate effect after its passage Thursday night.
According to the staff report, the ordinance sets a maximum allowable annual rent increase at 5% plus the consumer price index or up to 10% of the base rent, whichever is lower. The base rent is the rent as of May 25, 2023.
The council also approved the first reading of another ordinance that is substantively the same as the urgency ordinance, but is intended as a more long-term replacement that will provide an extra layer of protection against potential challenges.
That ordinance is on track to replace the immediate ordinance and take effect by July 8, 2023.
Wed, May 24, 2023 –
A 12-year-long lease, which includes affordability caps, is coming to an end for residents at a Capitola mobile home park. Now, the landlord plans to increase rent by 56%.
In March, Cabrillo Mobile Home Estate Parks, owned by Vieira Enterprises Inc., notified people it would increase rent from $641 to $1,000.
The steep increase prompted city council to consider an urgent ordinance that would cap rent increases at 5 percent plus the local average CPI or up to 10 percent of the base rent, depending on which is lower.
RE: CalMatters / California Department of Housing and Community Development (HCD)
Thu, May 18, 2023 –
California officials depend largely on residents filing complaints to find out about health and safety problems at mobile home parks. Here’s how to file a complaint.
A five-month CalMatters investigation found most park residents don’t know how to file a complaint or fear what could happen if they do. We took the most common questions we heard from park residents about the complaint system and put together a guide for you.
If management at my mobile home park doesn’t fix a problem, who can I turn to for help?
What can I file a complaint about?
How do I file a complaint?
How do I avoid retaliation?
What can I expect after filing a complaint?
RE: Sam Zell / Equity LifeStyle Properties
Thu, May 18, 2023 –
Equity LifeStyle Properties, Inc. (NYSE:ELS) (referred to herein as “we,” “us,” “our,” “Company,” and “ELS”) announced the passing of Samuel Zell, the Company’s Chairman.
Sam served as Chairman of our Board of Directors since March 1995 and as our Chief Executive Officer from March 1995 to August 1996. Sam was an entrepreneur and investor with a global perspective and is recognized as a founder of the modern real estate investment trust industry.
In addition to his service at ELS, Sam served as chairman of Equity Group Investments, the private investment firm he founded more than 50 years ago, Equity Residential, a publicly traded apartment REIT, Equity Commonwealth, a publicly traded office REIT and Equity International, a private investment firm focused on real estate-related companies outside the United States.
Sam was an active philanthropist with a focus on entrepreneurial education. Through the Zell Family Foundation, he led the sponsorship of several leading entrepreneurship programs, including programs at the University of Michigan’s Ross School of Business, Northwestern University’s Kellogg School of Management, Reichman University in Israel and the University of Pennsylvania’s Wharton School.
You can find more detail about Sam’s impressive life and career at https://SamZellLegacy.com/.
It is with great sadness that we announce that Sam Zell, chairman of Equity Group Investments, Equity LifeStyle Properties, Equity Residential, and Equity Commonwealth, died today at home due to complications from a recent illness. The family of Equity companies mourns his loss.
Equity Group Investments Press Release – Sam Zell 1941–2023 (PDF)
RE: Huntington Beach, California / Kennedy Commission
Fri, May 12, 2023 –
A state appeals court ordered the city of Huntington Beach to pay $3.5 million in legal fees to an affordable housing group stemming from the organization’s 2015 lawsuit over the city’s housing plan.
The three-judge panel ruled the Kennedy Commission’s lawsuit was a catalyst in forcing the city to bring its 2013-21 ‘housing element’ into compliance with state law.
While the city ultimately amended that earlier plan, Surf City leaders once again are embroiled in new legal battles with the state over their refusal to adopt a new plan, now 19 months overdue.
The appellate ruling Thursday, May 11 also follows news that the Huntington Beach City Attorney’s Office has reached a $5 million to $7 million court settlement with the Pacific Airshow.
Huntington Beach Councilmember Dan Kalmick estimated the airshow settlement could total up to $8.5 million. As of November 2021, the city’s litigation reserve was $14 million. These two cases potentially could eat up $10 million to $12 million of that.
RE: Sam Zell / Equity LifeStyle Properties
Thu, May 11, 2023 –
Billionaire Sam Zell is the largest mobile home landlord in the US, but his tenants say they reckon with disrepair, neglect, flooding and rising rents. Some have had enough.
Residents complain their dreams have been dashed by the park’s billionaire owner. They say they face hikes in rent and fees, while amenities like the pool and clubhouse are intermittently closed, there are few ramps or other accommodations for the elderly, and property maintenance has been neglected.
The man they blame is Sam Zell, the property mogul who is the largest landlord of mobile homes in the US. He styles himself as a ‘grave dancer’ for his business habit of buying up distressed assets, and serves as chairman of the board of Equity Lifestyle Properties (ELS), which owns Down Yonder and more than 400 other mobile home parks across the US. Residents at other ELS properties across the country tell the Guardian that they have raised similar complaints.
We’re withholding our lot rent because it’s the only voice we have and it’s the only thing Sam Zell pays attention to: money,’ Gartner said. And she plans to keep doing it until Zell and ELS ‘do something for us that they’re contracted to do, which is to take care of us. That’s why we moved here. It’s why we put our lives and safety in their hands. They told us they had our back. They don’t.
Equity Lifestyle Properties denied all allegations of lack of maintenance and upkeep, and characterizations of its property managers as harassing residents. It has filed eviction notices against the three residents at Down Yonder for failure to pay rent. ‘We are confident that the community is in full compliance of the Florida Mobile Home Act,’ which mandates that landlords must take good care of their properties, it said.
Sam Zell has an estimated net worth of about $6bn. He is one of the largest landlords of US rental properties full stop, with a huge real estate portfolio spread among affiliates under Equity Group Investments, his investment firm.
RE: Alden Global Capital / Smith Management
Tue, May 9, 2023 –
It’s late November, and nighttime temperatures have dropped below freezing in Christiansburg, Virginia, a town tucked in a valley between Blacksburg and the Blue Ridge Mountains. Sarah Rupp, an aide at Belview Elementary School, learned from a kindergartner’s grandparent that eviction notices were being posted at Massie’s Mobile Home Park, the only low-income housing in town. The modest manufactured homes, arranged in neat rows, are tidy but mostly aging. Some are sided with corrugated metal. Some – though they’re called mobile – appear nearly impossible to move.
Rents at Massie’s have shot up some 40 percent after new owners bought the park last spring. Since then, Rupp says, some renters have moved, leaving the park around 20 percent vacant. A few fled in the night, leaving possessions behind, she said. Rupp shows me a photo of abandoned children’s toys in a vacant mobile home. She worries that her school may lose as many as 15 percent of its students to homelessness.
Other tenants at Massie’s have been given eviction notices or ‘pay or quit’ letters. Some were posted on doors of people who’ve already paid their rent, while phones at the numbers provided by the new owners go unanswered.
An hour’s drive northeast of Massie’s is Princeton, West Virginia, where Valeria Steele owns her mobile home. A single mother of a special-needs child, Steele pays rent for the land beneath her house at Elk View Estates. Unlike Massie’s, where the tenants rent their trailers, at Elk View many of the tenants rent the land but own their homes, or have a rent-to-own contract. Though she hasn’t been given a new lease, Steele’s monthly lot rent shot up to $525-$300 more than she previously paid – after new owners took over the park last fall.
Tenants at both parks send their rent checks to a post office box in Englewood, New Jersey, that is associated with Smith Management, the parent company and deeply intertwined affiliate of Alden Global Capital, a hedge fund famously described by Bloomberg’s Joe Nocera as the ‘destroyer of newspapers.’
Massie’s and Elk View are among the more than one hundred such parks owned by limited liability corporations that in turn are owned by Homes of America LLC, a Delaware corporation that’s part of Smith Management. Across the country, Homes of America tenants are raising similar complaints: rent hikes of 40 to 60 percent, lack of basic maintenance, and unreachable managers. The parks’ owners have also become the targets of tenant lawsuits and legislation calling for tighter regulation.
RE: Nationwide / Fannie Mae / Freddie Mac
Thu, May 4, 2023 –
In mobile home parks around the country, millions of tenants and owners are being mercilessly exploited and regularly evicted, often by giant Wall Street firms like Blackstone.
The history of capitalism shows us that when low-income persons have a desperate need, exploiters will soon step in. As one mobile home park owner says, being the landlord for people like Jessica provides an enticing ‘sell to the masses, eat with the classes’ opportunity.
These particular masses are all but forced to pay whatever price their landlords decide to charge. Frank Rolfe, whose two hundred fifty mobile home parks make him one of the top five owners in the industry, boasts, ‘We’re like a Waffle House where everyone is chained to the booths.’ Rolfe and his partner also operate Mobile Home University, which crows about the benefits of holding a gun to the head of park residents: ‘The fact that tenants can’t afford the $5,000 it costs to move a mobile home keeps revenues stable and makes it easy to raise rents without losing any occupancy.’
Some of the world’s wealthiest people have noticed. Investment firms like Blackstone, Apollo Global Management, the Carlyle Group, and Stockbridge Capital Group all have bought large interests in mobile home parks. Warren Buffett owns both the largest manufacturer of mobile homes and some of the largest holders of the high-interest mobile home purchase loans. Equity Lifestyle Properties, a real estate investment trust founded by the multibillionaire Sam Zell, accused of ‘gouging grandma’ via rent increases and spending millions to resist rent control, is the largest mobile home park landlord in the country.
Part of the attraction is that mobile home park landlords like Zell have significantly less obligations than landlords of traditional housing. All of the maintenance and upkeep of the actual structures is the sole responsibility of the mobile home owners. Mobile home park investor Michael Torres told NPR in 2022, ‘It’s just basically resurfacing roads and having a shared community center. You don’t own walls and roofs.’ The bottom line, Rolfe claims, is that mobile home parks have the highest yield in real estate.
Remarkably, the federal government is helping contribute to those profits. A 2021 NPR story unsubtly titled ‘How the government helps investors buy mobile home parks, raise rent and evict people’ revealed that the government-backed mortgage finance agencies Fannie Mae and Freddie Mac, whose mission is to make housing more affordable, provide billions of dollars in low-interest loans that huge investment companies use to buy the parks.
Wed, May 3, 2023 –
Members of the Mobile Home Resident Coalition rallied outside of Huntington Beach City Hall on Tuesday afternoon, continuing to fight steep rent hikes that have put many of them in a perilous position, leading them to ask the City Council for assistance.
The MHRC has been putting its resources into backing Assembly Bill 1035. Introduced by state Assemblyman Al Muratsuchi (D-Torrance), the bill would prohibit the management of a mobile home park from increasing the gross rental rate for a tenancy for a space more than 3% plus the percentage change in the cost of living — or 5%, whichever is lower — over the course of a 12-month period.
That bill has been put on hold, however, by Buffy Wicks, the chair of the Assembly Housing and Community Development Committee. There is a lawsuit by Anaheim Mobile Estates challenging a new state law that imposes rent restrictions on mobile home parks located within at least two cities, and that litigation could impact Muratsuchi’s bill.
AB 1035 has become a two-year bill, meaning it would have to move through committees next year and go into effect in January 2025 at the earliest.
RE: Suggested Reading by Brendan Ballou / Fannie Mae / Freddie Mac
Tue, May 2, 2023 –
The authoritative exposé of private equity: what it is, how it kills businesses and jobs, how the government helps, and how we stop it.
Private equity surrounds us. Firms like Blackstone, Carlyle, and KKR are among the largest employers in America and hold assets that rival those of small countries. Yet few understand what these firms are or how they work.
In Plunder, Brendan Ballou explains how private equity has reshaped American business by raising prices, reducing quality, cutting jobs, and shifting resources from productive to unproductive parts of the economy. Ballou vividly illustrates how many private equity firms buy up retailers, medical practices, prison services, nursing-home chains, and mobile-home parks, among other businesses, using little of their own money to do it and avoiding debt and liability for their actions. Forced to take on huge debts and pay extractive fees, companies purchased by private equity firms are often left bankrupt, or shells of their former selves, with consequences to communities that long depended on them.
Perhaps most startling is Ballou’s insight into how this is happening with the active support of various arms of the government. But, as Ballou reveals in an agenda for reining in the industry, private equity can be stopped from wreaking further havoc.
RE: San Rafael, California / Harmony Communities
Tue, May 2, 2023 –
A settlement reached last month between the City of San Rafael and a mobile home park owner requires the park to remain open for the next decade, ending 16 months of litigation.
‘The city has a continuing interest in affordable housing,’ said attorney Michael von Loewenfeldt of Wagstaffe, von Loewenfeldt, Busch & Radwick, a firm representing the City of San Rafael. “A bargain was struck that provides the residents with a longer-term certainty than they might have had even if we won the lawsuit. The park could have closed this year or next.’
San Rafael negotiated other important tenant protections, too. A rent hike cap stays in place for current residents, limiting the annual increase to 75% of the local Consumer Price Index.
Residents who paid a contested rent increase of $100 per month from November 2021 through June 2022 will receive a refund.
The park must withdraw pending notices of termination, considered the first step in the eviction process. And all notices to fix violations of park rules are reset, giving affected residents a new 30 day-period to correct the cited problems with their homes.
RE: San Rafael, California / Harmony Communities
Tue, Feb 21, 2023 –
The first rule in affordable housing is don’t lose what already exists. That backward step may soon happen in San Rafael, displacing low-income residents at 40 residences, unless the city acts decisively.
In a column last year, I suggested that an overlooked source of affordable rentals are mobile homes. There is no need for expensive construction. Traditionally, most park residents own their not-so-mobile structures, which are inexpensively customized for long-term living. All that’s needed is a concrete pad with drainage, water availability and electricity.
A recent incident at one Marin mobile home park is suddenly a hot topic. The location is the R.V. Park of San Rafael at 742 Francisco Blvd. West. I was told that approximately 80 people live there, ranging in age from 2 months to 96 years and occupying more than 40 ‘pads’ or ‘spaces.’ Most of these long-term tenants aren’t draining public resources or overburdening public services. They are the “working poor” and retired folks living on Social Security.
Until Feb 1, 2023, the 1.26 acre site was owned by the K&M Family 1997 Trust. Its trustee, Donna Chessen, an 85-year-old Orange County resident, retained a Stockton-based investment company, Harmony Communities, as the manager. Harmony controls 33 ‘manufactured housing’ parks.
Last week I visited the site. Most tenants received an eviction notice from Harmony dated Feb 10. It indicated they are to be out by Oct. 31 due to “a change of use.” Harmony contends the park isn’t profitable. The new use remains unknown.
Not so coincidentally, on Feb 10, the Ninth Circuit Court of Appeals rejected litigation filed by the park’s owners who claimed San Rafael’s mobile home rent stabilization ordinance (MRSO) was an unconstitutional “taking.”
For those concerned about landlord rights, the court’s reasoning is instructive.
When a rent control ordinance is in place and a matter of public record before a property is purchased, the sale price incorporates the burden of the rent control,” the decision reads. “Here, not only had the MRSO been applied to the RV Park for over fifteen years when Chessen purchased the property, there was a final judgment from a state court concluding that the property was subject to the ordinance. It would be unreasonable to conclude that the sale price of the property under such circumstances did not reflect the burden of the MRSO.
Harmony bet they’d defeat San Rafael’s renter-protection law in court. It lost the gamble.
Mon, Feb 27, 2023 – The MHPHOA online version of the 2023 California Mobilehome Residency Law in HTML has been updated to reflect all changes indicated below.
From the Senate Select Committee on Manufactured Home Communities:
Division 2, Part 2, Chap. 2.5 of the Civil Code. The Mobilehome Residency Law (MRL) is the “landlord-tenant law” for mobilehome parks, which, like landlord-tenant law and other Civil Code provisions, are enforced in a court of law. The Department of Housing and Community Development (HCD) does not have authority to enforce violations of the MRL.
Senate Select Committee on Manufactured Home Communities
- File Type: PDF
- Pages: 145
- Size: 2.1MB