I helped an associate with ideas for an article for a statewide mobile home resident publication. After reviewing his efforts, I thought he did such a good job that I would put the article (below) on my BLOG.
A friend of mine described a resident park purchase as being like a supertanker heading out to sea. If you’ve never seen a supertanker, they’re huge. The largest ones are 1,200 feet long (that’s 4 football fields). Each can hold millions of barrels of oil.
When a supertanker starts, its huge propellers churn and churn and churn. And it goes nowhere. It takes enormous effort for there to be any movement. Then, ever so slowly, it starts to move forward. Once it’s moving, a supertanker needs careful guidance from tugboats and harbor pilots to make it out into the open ocean.
At sea, a supertanker is pretty fast (up to 15 knots) and has massive amounts of momentum. And once it’s going, it’s very difficult to stop and even more difficult to turn.
When you and your neighbors decide you want to buy the MH park where you live, think about a supertanker.
Simply put, you will work long and hard before there is any movement. And you need to know your destination in advance (meaning, have a plan), because once you’ve started, changing course is rarely an option.
I believe there are 3 keys to achieving ownership of your park. In every successful conversion I’ve seen, these 3 elements were in place:
(1) A park owner willing to sell his park, at a price you and your neighbors can afford. Think of this goal as your destination, and how to get there as your plan.
Realistically, your park owner probably doesn’t consider your resident group to be worth his time. You need to educate him that your resident group is an attractive buyer. In fact, you can be the most attractive buyer. Your park owner just doesn’t know it yet.
Your efforts to educate the owner are similar to the supertanker’s churning propellers. You will work long and hard, keep reminding the owner, being persistent. Don’t send an aggressive neighbor to meet with the owner or his representatives. You won’t make any headway if the park owner thinks you are unprofessional.
(2) Resident leaders. These are people in your park who are willing to work toward the goal. Ideally, this is a group of 5-10 residents who represent all factions in the park, have the knowledge and life skills to lead the process, and have the trust of the resident group.
Often, things start with two or three like-minded folks sitting around a kitchen table, lamenting problems about the park owner or management. What they really want is quiet enjoyment of their lifestyle. They would like to see their rents stabilize, their home values increase and their park built into a better community. They would like to take control of their futures. And they decide to work toward these goals, rather than just talk about them.
(3) An experienced consultant. Think of this person as your harbor pilot (or tugboat, whatever). These projects need guidance, financing, organization, cheer leading, and lots of hand holding. You’re not likely to succeed without the help of an experienced consultant. The consultant
– Figures out if the deal can work (it must work for most of the park residents and for the park seller, or it will fail);
– Joins with the resident leaders to negotiate with the park seller and keep the deal moving forward;
– Knows how to put the financing together (find mortgage money);
– Has a track record of success. The consultant’s past successes give your resident group credibility with the park seller.
– Is only paid if your resident group succeeds in buying your park (the consultant’s interests are aligned with yours).
There are almost 5,000 mobile home parks in California. The first California park to become resident-owned did so in the mid-1970’s, about 40 years ago. As of today, only about 200 of California’s MH parks have become resident-owned. Why so few? Because these deals are hard to do and can get off-track easily.
Your odds of someday owning your park improve greatly if you understand and use the 3 keys discussed above.
Your FIRST STEP: Contact me for the materials you can use to reach out to your park owner and GET STARTED.
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.