Filling the need

In the 1920s, the growing sales of automobiles brought about the birth of the travel trailer or house trailer, as they were originally known; a box fabricated from panels and attached to a trailer. Americans hitched these compact units to their cars for camping trips or extended travel. In the late ’40s and early ’50s, energetic postwar manufacturers used metal panels and bumped up the average width to about 8 feet, and later 10 feet, garnering the nickname “ten-wide” for mobile homes, as they became known. These homes were marketed to buyers as inexpensive, permanent housing, and parks sprouted up to accommodate the special site requirements for these kinds of homes.

Over the decades, the homes became even longer and wider. Some owners kept them on their wheeled trailers and others set them on masonry foundations. And as the industry grew, manufacturers and the U.S. Department of Housing and Urban Development (HUD) set strict standards for design, fabrication, fire safety, and systems.

In 1976, they introduced a new term, “manufactured home,” to replace “mobile home,” as a legal classification for structures built to the new codes.

The management picture

Several factors influence how a park or development of manufactured homes is managed, including state and local regulations, ownership structures, profit or not-for-profit status, and mix of owners vs. renters. Generally speaking, though, the major difference between a manufactured home park and a stick-built development is that the owner (individual, corporate, or the management company itself) owns the land, and the homeowner owns the “box” or home.

Jeffrey Eales, CPM®, CCIM®, Birtcher Anderson & Davis, AMO®

Veteran property manager Jeffrey Eales, CPM®, CCIM®, senior vice president of Birtcher Anderson & Davis, AMO®, describes the inherent challenge: “It’s different than managing apartments because you’re dealing with homeowners,” he says. “They own the coach. We own the land. I have one property where I have 383 owners. If it were a 383-apartment complex, I’d have one owner and 383 residents.” 

Who’s buying, and who’s renting?

Understanding the demographics and expectations of manufactured home buyers and renters is crucial for property managers. Kim Nicholson, vice president/division manager for the manufactured housing division of Property Management, Inc., (PMI) AMO® in Camp Hill, Pennsylvania, observes, “The market primarily is driven from two different groups. You have the beginners looking for their first home, and you have the people who are downsizing and retiring. Currently, there are a lot of resales that attract the midrange individuals looking to move from rentals or to rentals and so forth.”

Kim Nicholson,
Property Management, Inc., AMO®

Property managers will generally be working with three market segments: young families looking for affordable, spacious living options, retirees seeking low-maintenance, single-story homes, and first-time homebuyers who are attracted by the lower cost of entry. These potential customers have high expectations regarding technology, sustainability, and community amenities. Meeting these expectations can significantly enhance the attractiveness of manufactured homes.

Managers of manufactured home communities may have different service and amenity levels at different properties. Eales describes starting in the business managing affordable housing and then, over time, adding more luxurious parks.

“I took over for a client who is a nonprofit with a mission of providing affordable housing in California,” says Eales. “Back in 2009, they had 11 properties, and then over the next 15 years, they grew that to 32. I grew my staff, hired some regional directors, and eventually, we came up to almost 4,000 total units.

“I also manage one premium manufactured home property in San Diego, which my company developed in 1971–1972. We sold it and have been managing it on behalf of the owner for 52 years now. It’s a five-star park, and I’ve got a $2.5 million clubhouse renovation, a kitchen that rivals what you’d find on Iron Chef America, and a fitness center with top-of-the-line equipment. It’s just a gorgeous, fantastic property.”

Dealing with the churn

Another aspect of manufactured home community management is the tear-down/new “roll-in” turnover. Unlike properties that are stick-built, removing outdated homes and replacing them with new models is a much faster process.

“Some of the homes that are older have lost their useful life, and it’s not worth it to repair them,” Nicholson says. “It is best for all parties if the home is taken off-site and dismantled outside, and then they can install a new home that meets the requirements of today’s consumers.”

Eric Kunkle, CPM®,
Property Management, Inc., AMO®

Eric Kunkle, CPM®, PMI’s president and CEO, is committed to their manufactured home sites. “We have about 3,300 units, so it’s a very important part of our organization,” Kunkle says. “We like to be a turnkey, full-service property management solution, and this manufactured housing division has been growing—we pick up a few clients every year. We market our services to potential new clients by providing top-level, day-to-day management and making an effort to enhance the community. The best way to attract people is to maintain the infrastructure that we control, but also help the individual homes to make sure that people take pride of ownership and community.”