‘It’s like winning the lottery’: the mobile home owners buying the land they live on | Housing

Bev Adrian, a retired career placement counselor for people with disabilities, lives in Woodlawn Terrace, a mobile home park just outside Minneapolis, Minnesota. The nearby streets are full of bustling local businesses – a Sota Boys Smoke Shop, a Pump N Munch Gas – but Woodlawn is a quiet park tucked away under maples and pines.

Adrian moved there four years ago, coincidentally right as Woodlawn’s owner was looking to sell. Woodlawn’s landlord was well liked, but for years Woodlawn’s residents had been hearing rumors about possible sales to much less friendly owners.

“People lived here in fear,” Adrian says, “because these places are just swallowed up.”

Mobile home parks, also known as trailer parks, are officially and more accurately called manufactured housing parks. Prefab homes are substantial constructions; once placed in a park, more than 80% of them are never moved.

In these parks, residents own their homes but pay rent to landlords who own the land and its infrastructure (including water and gas hookups). Over the last decade, private investors have discovered one very simple thing: owning a manufactured housing park is an incredibly lucrative thing to do. Now, throughout the country, local landlords are making way for out-of-state owners notorious for jacking up rents while letting conditions deteriorate.

But Adrian knew about a non-profit group called Roc USA that helped manufactured housing residents buy their own parks. So she set about facilitating a sale – to Woodlawn’s own people.

As private owners work to maximize profit, Roc USA is fighting for a radical oppositional model: resident-owned communities, or Rocs. According to an industry analysis from 2019, the average annual rent increase in privately owned parks is 3.9%. In recent years, according to the Washington Post, some park residents have seen their rents rise much more rapidly, even doubling or tripling. According to a 2020 Roc USA analysis, the average annual rent increase in community-owned parks is just 0.9% – or $3 a year.

For the kinds of people who traditionally live in manufactured housing communities – retirees and low-income earners – the best chance to protect their housing is to take ownership of it themselves.

In February, the Biden administration announced the details of the Preservation and Reinvestment Initiative for Community Enhancement (Price) Act, which Congress passed in 2022 and mandates the creation of a $225m grant to improve manufactured housing infrastructure nationwide. The act, which Roc USA and members of its resident-owned communities lobbied for, marks the first time the federal government has laid out a funded program to support manufactured housing.

Advocates for manufactured housing say this kind of national recognition is long overdue. Manufactured housing communities make up 7% of the country’s housing stock and more than 14% of its rural housing stock. They house 22 million people and are the single largest provider of unsubsidized affordable housing.

In 2000, the number of homes in cooperative-owned manufactured housing communities was in the hundreds. Today, there are more than 22,000 homes in Roc USA communities. Not a single Roc USA community has ever closed, reverted to private ownership, or otherwise displaced its residents.

In the winter of 2021, Adrian and Woodlawn’s residents purchased their park through a local subsidiary of Roc USA. Thanks to strong recent support from its state legislature, Minnesota has become a hotbed for cooperatives like Woodlawn. Each time a park becomes a cooperative, a tiny bit more of the country’s affordable housing is taken out of the private market. Each new cooperative proposes a radical concept: what if we stopped seeing housing as an investment? What if we simply saw housing as housing?

Who owns the parks?

Before private equity entered the market, the most notorious landlord in manufactured housing was Frank Rolfe. “There’s a huge number of poor people,” Rolfe would tell potential new landlords at his investor’s boot camp, “and there’s more poor people, like, every day.” But Rolfe’s one-man operation looks quaint compared with today’s investors.

The list of names is glitzy and notorious, including billionaires such as Warren Buffett and Sam Zell; massive investment entities such as Blackstone and Apollo Global Management; and the NBA superfan James Goldstein, who can afford his courtside tickets thanks to a fortune amassed in part from fighting drawn-out legal battles against rent control ordinances for manufactured housing parks. As the Financial Times has reported, the parks provide a return on investment of more than 4%, “double the average US real estate investment trust return”.

Buffett, known ostensibly as a good-guy investor, has created a closed loop of exploitation in manufactured housing. One Buffett-controlled company, Clayton Homes, dominates the market: through various subsidiaries, the Seattle Times has reported, Clayton sells manufactured houses, high-interest loans on those houses, and their high-priced insurance policies. Clayton is closely intertwined with the Manufactured Housing Institute, the industry’s primary lobbying group, which has spent over $4.5m over the last two decades protecting the interests of private owners.

The residents strike back

On a recent winter morning, I drove south from Minneapolis to meet Bev Adrian at Woodlawn, the resident-owned community where she’s now president. The sun was shining on the pickup trucks, the vinyl-siding-clad homes, and the park’s communal garden beds. Adrian – small-framed, abundantly energetic – hustled me into her home, which was full of Bob Dylan posters, cookbooks, and political manifestos.

Woodlawn voted to become a cooperative in March 2020, right at the outset of the pandemic. Indoor gatherings weren’t allowed, so the residents – “ecstatic” to vote yes, says Adrian – grabbed chairs and posted up in a central patch of Woodlawn they redubbed Park Square. Through its local subsidiary, Roc USA ran its traditional playbook for Woodlawn, which means giving the residents technical assistance on how to form a cooperative and navigate the purchasing process.

Roc USA and its subsidiaries can also lend directly to cooperatives. The cost of a park varies depending on its size and location; for the last seven years, the average sale price for a ROC USA community has been $4.15m. The Roc USA loans are repaid, with often better-than-market interest rates, thanks to the organization’s savvy use of state subsidies. On average, Roc USA residents pay $417 a month to service these loans. Residents also pay a one-time fee, usually just a few hundred dollars, to join the cooperative. If they leave, they’re refunded the money.

Before Woodlawn became a cooperative, Adrian used to regularly see folks drive in and out in Escalades and other conspicuous luxury vehicles – potential buyers, she was sure. To this day, she says, she gets solicited weekly, via postcards and calls: “‘Are you the owner of the park? Are you interested in selling?’” Despite Woodlawn’s status as a cooperative, private investors haven’t given up, Adrian says: “They’re just out there.”

As a non-profit, Woodlawn is eligible for a “boatload” of state grants, Adrian says, and so Woodlawn has money and plans: to revitalize a private well for drinking water; to replace a load of sewer lines; to properly fix up the park’s rental units. “Who gets to spend millions?” Adrian says, laughing, incredulous at her good fortune. “It’s like winning the lottery.”

Adrian is part of an informal network of activist resident-owned community presidents fighting to increase the number of cooperatives in the state. That includes Natividad Seefeld, who helped turn her own community – the 88-home Park Plaza in nearby Fridley, Minnesota – into a cooperative in 2011. Since then, Seefeld has become a nationally recognized crusader for the resident-owned community model. When I visit her in Park Plaza, she peppers her monologues with phrases like “that is serious straight-up bullshit” and “I would kill a bitch”.

As the chair of the resident-led Roc Association’s policy and advocacy committee, she was instrumental in helping push through the Price Act, which will provide hundreds of millions in federal funding for manufactured housing. She’s become adept at luring high-profile politicians such as Minnesota’s US Representative Ilhan Omar and the state’s attorney general, Keith Ellison, to Park Plaza. She’s also testified at state capitol hearings for years; she just has to figure out scheduling ahead of time, so she can get time off her full-time job at a General Mills warehouse.

At those hearings, Seefeld regularly comes face to face with Mark Brunner, president of the Manufactured and Modular Home Association of Minnesota, the state’s main lobbying group for private owners of manufactured housing parks.

“He gets up there and he will straight-up lie,” Seefeld says. “I always want to stand up and say, ‘That makes no sense!’ I have to sit there and calm myself down,” she says with a laugh. “He just fully despises me. I don’t know why. Some people are just that way.”

Before I leave Park Plaza, I sit in on a board meeting in the community center, which doubles as Park Plaza’s storm shelter. Built a few years back to replace an inadequate bunker, it’s dotted with primary-color children’s handprints and flags representing residents from Afghanistan, Italy, and Mexico.

The first order of business is the installation of solar panels on a resident’s roof. Another family’s home desperately needs new doors. Some of the community’s trees need shots to protect them from invasive emerald ash borer beetles. Again and again, residents ask the same fundamental question: how are we going to pay for this? And again and again, they find a make-do solution.

Before we wrap up, Seefeld reports that a resident named Suad has asked Seefeld if he can form a cleanup committee. Everyone is pleasantly shocked, but also unsure how to proceed: no one has ever actually volunteered to start a committee before. They decide they’ll figure out the details later.

Seefeld recounts her conversation with Suad, doing her best to imitate the accent of his native Bosnia. Dramatically raising her hands stiffly into the air, she shouts, “I want us to be beautiful!”

A model for the country

The Democrat Matt Norris, 35, smiley and sincere, represents district 32B in the state’s house of representatives, encompassing a small chunk of central Minnesota that Norris says has more manufactured housing than any other district in the state.

Just outside Norris’s office is a framed Tupac poster, paraphrasing the rapper’s lyrics: “Even though you’re fed up, you gotta keep your head up.”

Norris has become the go-to guy for manufactured housing in Minnesota. He’s seen residents’ anger first-hand, recently and most prominently at a park called Blaine International Village in Blaine, Minneapolis, that was purchased by Havenpark Communities. Based in Utah, Havenpark is highly active in Minnesota and has become notorious locally for rent increases and deteriorating infrastructure. As one Blaine resident told me, “There was 40 years of family ownership. They raised rent $200 in 40 years. Havenpark, they’ve done $200 in four years.”

After Havenpark’s takeover, Norris held a town hall at Blaine to hear its residents’ complaints, which went beyond rent to crumbling streets and an inadequate storm shelter.

“The room was at capacity – the fire marshal would have stepped in if we had packed any more people in there,” Norris says. “And there were 100 people waiting outside on a 90-degree day because they were so furious about what was going on.”

Norris says he’s had success forcing Havenpark to address some of the basic maintenance issues, but there has been no compromise on rent.

Norris has been instrumental in passing legislation to support resident-owned communities. The state of Minnesota’s housing fund now has a revolving $10m fund that cooperatives can utilize to quickly make an offer. Furthermore, if park owners sell to their residents, they get a tax credit that makes offers from their residents more lucrative, even if a private investor offers more cash.

Mike Bullard, Roc USA’s spokesperson, says that even more than the actual loan, it’s the technical assistance – expert guidance through the process of owning a park and maintaining its infrastructure – that is crucial to a resident-owned community’s success.

Traditionally, your local municipality is responsible for things like the upkeep of roads and the sewage system. In manufactured housing communities, the owners are responsible for all of that. If a pipe bursts, they need to know how to fix it. If a tornado smashes up a playground, they need to know how to fix it.

“In the affordable housing space, everybody agrees that there’s a huge need for technical assistance,” Bullard says. “It helps guarantee success, but nobody wants to pay for it. We bake it into the model.”

Others, like Linda Shi, a professor at Cornell University’s department of city and regional planning, emphasize the strengths of the Roc USA system. Shi, who’s published research on the topic, believes that Roc USA’s practices could be expanded beyond the ownership of manufactured housing parks to other forms of housing.

Could that model work for a group of big-city tenants wanting to buy their apartment building? Or a group of small-town retirees wanting to buy their retirement community? “Why don’t people replicate this model?” Shi asks. “We’re waiting for an answer.”