As I mentioned in my prior Blog, I have been really busy on three things in particular:
1. Responding to resident groups casually interested in buying their park,
2. Responding to groups with an immediate problem, and,
3. Responding to owners who want to sell their park to the resident group.
Today I want to talk about 2): Park Resident Groups with an immediate problem.
The park owner wants to throw everyone out and close the park for redevelopment.
I am working with four (4) of these projects.
They all have similar characteristics.
The parks have been around a while and the local community has grown up around them. Where they were once on the outskirts of town, they are now in a much more attractive location. And developers, always willing to try make a buck by building something new, offer the park owner lots of money IF and ONLY IF the park can be closed and, sometimes, rezoned.
When asked, I tell the residents that they are in a ‘no holds barred’ fight to prevent the closing.
Occasionally, some residents think that it would be better to take what relocation funds are offered to them by the owner and move on.
Guess again. The owner is motivated to fund your relocation as cheaply as possible. And the residents often simply have no idea where they will go, if they can actually take their homes with them, and how much it will cost. The short answers are: nowhere; they can’t; and much more than they anticipate.
So you fight. You have NO downside.
Remember, however, the owner, having decided to sell (albeit at an enormous price) basically wants out. So now is a great time to convince him that the resident group is the best buyer available.
First, you have to defeat the closure. It is mostly a political fight. Your strengths include your standing as active community members who vote, the communities requirement to provide affordable housing units (which is what you are), your individual stories (the media always like good stories), and your status as the underdog. There is a financial consideration also. If your attorneys (and you HAVE to find a good public interest law firm to take your case) can connect the municipality to the park closure (if, for example, the city must change the zoning for the deal to proceed), then the relocation costs required by state law are triggered. These are much more burdensome for the city and the park owner than what the park owner might have offered initially.
At the same time, it is helpful to provide the City Fathers with an alternative – if the owner can’t close the park, maybe he can sell it to the resident group. That means the group needs to put together an offer to the owner based upon the best information available. Note that, after the closure has been defeated, the park is probably less attractive to the next investor, who is unable to delude himself that HE can close the park and make a windfall profit.
Defeating the closure requires strategy by the group and their attorneys. I help in this effort.
Preparing the purchase offer is my most important contribution. Presenting the group as credible, realistic and having available financing makes the City Fathers much more supportive of the group purchase, and shows the park owner the group can really buy the park.
Of course, the owner is probably depressed that he failed to close the park, and it may take him a while to come back to the negotiating table.
Never mind. If you defeat the closure, you have the time.
And to paraphrase Mae West (I think), if you got the time, Honey, I got the money.
Deane Sargent and PMC Financial Services have been helping mobile home park resident groups and cooperatives to organize and find financing to buy their parks for over 20 years.