As MHProNews reported May 28, 2015, UMH has been on an aggressive acquisition tear, especially in the energy drilling regions, where it has been buying MHCs with low occupancy and in need of updating. While occupancy has been increasing, rentals of the MH now comprise 22 percent of the portfolio.
Energy industry workers go where the work is. Energy development is often a cyclical industry. If a better opportunity presents itself elsewhere, the worker may move on.
However, UMH CEO Samuel Landy is very upbeat: “Shale development is fueling the revitalization of this region. Industrial development in the region is also being driven by pipeline construction to reach end consumers and gas processing plant construction. These multi-billion dollar projects continue to move forward despite the recent drop in oil prices,” said Landy during the Q2 conference call.
As long as the confluence of falling oil prices, environmental concerns about fracking’s possible relationship to groundwater contamination and earthquakes does not interfere with UMH’s expansion, investors should not have to worry.
At last count, UMH owns and operates 92 MHCs comprised of 15,700 developed home sites. As was noted in the Daily Business News December 22nd 2014 report, part of the beauty of the communities sector and the manufactured housing business in general is precisely that it is the most affordable housing in America. Thus, the risks are mitigated by a broader appeal and need, beyond just energy sector workers. ##
(Photo credit: UMH Properties, Inc.)
