Each resident park purchase is different – different people, different owners, different real estate. And, if you think about it, they are, each in their own way, difficult. Essentially a group of folks band together to undertake what is probably one of the biggest challenges they have ever faced.
Here are some brief summaries of park purchases and subsequent, after a period of ownership, refinances:
MEADOWLANE PARK, ALEXANDRIA BAY, NY (2018)
Meadowlane park is a seasonable (meaning only active in the summer) park with 87 sites on the shore of the St. Lawrence Seaway in upstate New York. The residents purchased the park with 91% participation in March 2018 for $2,750,000. Membership price was $6,100 each and a deferred payment plan was offered to the residents.
BLUE PACIFIC (CA) REFINANCE – 2017
The Homeowners Association of Blue Pacific Mobile Home Park, Aptos, Ca, refinanced the loan they used to purchase their mobile home park in 2011. The original loan was guaranteed by HUD/FHA and was a 40-year, fixed rate, fully amortizing loan for about $5,600,000. The new loan, using the HUD/FHA Interest Rate Reduction (IRR) program, lowered their interest rate to 3.77% fixed for the remaining 35 years of their loan.
ALIMUR PARK (CA) PURCHASE – 2016
Alimur HOA members purchased the 147-site park located in Soquel, Ca for $11,000,000. The membership included approximately 100 home sites, with the remaining sites staying as tenants. The purchase price included $12,000 per membership share (with financing up to 95% available) and a first mortgage held by the park seller.
PALM TERRACE (CA) REFINANCE – 2016
The resident group at Palm Terrace MHP, Aptos, CA have completed the refinance of their existing first mortgage loan. The group (Palm Terrace Mobilehome Owners Association, Inc. – PTHOA) purchased the park in 2006. The park, which has 48-sites and a clubhouse, was built in 1950.
The refinance loan, which took only 50 days to process, was for $1,820,000 with a 10-year term, 30 year amortization and an interest rate of 3.62%. The prior loan had similar terms and carried an interest rate of approximately 6.5%. The refinance loan provided sufficient funds to payoff the balance of the prior loan and fund over $350,000 for capital improvements, additional park amenities, and reserves. The refinance loan was funded by Federal National Mortgage Association (Freddie Mac).
COUNTRY VILLA (CA) PURCHASE – 2012
The resident group at Country Villa MHP, Soquel, CA purchased their mobile home park, through their resident-owned mutual benefit corporation, Country Villa MH Owner’s Association (CVMHOA). The purchase arose out of discussions with the park owner, who was interested in retiring from the MHP business. The resident group and the park owner were able to work out a deal which was attractive both to the owner, and to almost 75% of the residents, who gave up the protections of the Santa Cruz Country Rent Control Ordinance to become members of CVMHOA. Residents not becoming members of CVMHOA remained on rent control with CVMHOA as their new landlord.
BLUE PACIFIC (CA) PURCHASE — 2011
This project is a 100-site park in Aptos, CA, about 1/4 mile from the Pacific Ocean. The resident group sued the owner for failure to maintain the park . PMC was able to negotiate the purchase of the park using a loan from HUD/FHA. The original loan was guaranteed by HUD/FHA and was a 40-year, fixed rate, fully amortizing loan for about $5,600,000. About 85% of the residents give up rent control to buy their share.
LAKESHORE ESTATES (OR) PURCHASE – 2007
This project is a 46-site park near Corvallis, OR. The purchase of this California mobile home park was funded by a first mortgage loan from a conduit lender, combined with resident equity. About 75% of the residents participated, most using share loan financing from a regional Non-Profit Lender.
WORLD MARINE ESTATES (CA) REFINANCE – 2008
This project is a 126-site mobile home park in American Canyon, CA, near the San Francisco Bay Area. The project was the refinance of an existing conduit loan with a 10-year term. In addition, the ownership group expanded their membership from about 55% to about 75%. Finally, the group obtained additional funds to make needed park infrastructure improvements. This financing was extremely difficult because the financing market was in general meltdown, loans were very difficult to arrange, and the time requirements caused the existing loan to go into default.
PALM TERRACE (CA) PURCHASE – 2006
The resident group at Palm Terrace MHP, Aptos, CA completed the purchase of their 48-site mobilehome park. The park, which has a small clubhouse, was built in 1950. The purchase loan was for about $1,500,000 with a 10-year term, 30 year amortization and an interest rate of 6.5%.
APTOS KNOLL (CA) PURCHASE – 2005
Aptos Knoll is a 76-site mobile home park in Aptos, CA, near Monterey Bay. The purchase by the resident-ownership group was funded by a first mortgage loan from a conduit lender, combined with resident equity. More than 80% of the residents participated and gave up their ‘rent controlled’ status to become park owners. Share loan financing was provided through funds raised in the park. There are currently only two non-members remaining in the park.
PAUL REVERE COOPERATIVE (MN) PURCHASE – 2005
This project is a 155-site park in Lexington, MN, near Minneapolis. PMC acted as consultant to the local non-profit entity serving as project sponsor. The purchase was funded by a first mortgage loan from a conduit lender, combined with a subordinated loan from a community development lender. Share funding was provided by the local non-profit entity. About 50% of the residents participated.
ISLANDER MOBILE HOME PARK (WA) PURCHASE – 2004
This project is a 60-site park in the center of the Town of Bainbridge Island, across from Seattle, WA. The park was facing closure. The purchase was funded by a first mortgage loan from a conduit lender, combined with resident equity. Most residents participated and became park owners. Share loan financing was provided through funds raised in the Town.
SPRINGLAKE COMMUNITY (OR) PURCHASE- 2003
This project is a 147-site park in Scappoose, OR, northwest of Portland. The park was relatively new, but had 25 sites that had never been occupied. This complicated the financing. The purchase was funded by a first mortgage loan from a conduit lender, combined with resident equity. About 70% of the then current residents participated. Share loan financing was provided through funds from a private investor.
PMC Financial has helped mobile home park cooperatives and resident communities to buy their parks for nearly 30 years.
If you are thinking about setting up a mobile home cooperative or creating a resident-owned community, please contact us »
Deane Sargent (deane.f.sargent@gmail.com)
PMC Financial Services