Frank Rolfe and Dave Reynolds have been involved in the Kurt Kelley, J.D., quarterly MHReview since the early days when the quarterly was still a monthly publication. Rolfe, for example, often appears with an article in their pages. Ads by one or more of Rolfe/Reynolds enterprises are not uncommon in MHReview (MHR). The manufactured home communities’ (MHC) segment of the industry is a routine subject for their publication, perhaps due in good measure to their sponsors and Kelley’s own business interests in that sector. In their Q4 2023 issue, the first article up is by Rolfe and is entitled: “Don’t Bring a Knife to a Gun Fight.” That may seem to be a bit melodramatic, but it is his title and not ours. As is our norm, every item mentioned in the headline will be covered in this report, analysis, and weekly recap.
Part I
In his MHR article, Rolfe runs through what he sees as troubles in the commercial real estate (CRE) sector: office buildings, retail centers, hotels, self-storage and industrial segments of CRE all get his thumbs down.
Apartments are okay, per Rolfe. In a total no surprise for those who know him, so too are “trailer parks” or “mobile home parks” – Rolfe’s deliberate (mis)use of those terms instead of land lease communities or manufactured home communities (MHCs).
Also, in the new issue of MHReview is an article by “Dr. Cody J. Dees” which includes these opening thoughts: “By now, most everyone in the industry has seen or heard news coverage related to the class-action lawsuit, which was filed against Datacomp, and its customers. Skimming the suit, it appears to build a narrative that mobile home park owners are intentionally using ‘less than ethical’ means for establishing competitive rent pricing and must be held accountable.” Yes, “most everyone in the industry has seen or heard the news coverage,” perhaps not so much because of MHR, or MHInsider, et al., but rather due to the regular references found here on MHProNews and our MHLivingNews sister site. It is to some extent a backhanded compliment. But as the first link below reminds regular readers of MHProNews, there is what could be described as a ‘regional’ class action as well as national class action. That’s one of several details that Dees, a self-declared linguist, appears to have missed mentioning.
Dees linked Datacomp to a page that per a word search performed by MHProNews has no mention of the owner of Datacomp, MHVillage, and MHInsider. That would be Equity LifeStyle Properties (ELS). That noted, on 12.16.2023 that page linked by Dees from Datacomp oddly claims: “Accurate, Independent, Market-Based Mobile Home Appraisals.” Independent? Independent of whom? Certainly not independent of ELS, are they?
Dees also said: “As unfounded allegations like these are often thrown about without a requirement for supporting evidence, I would like to take the next few moments to engage a bit deeper with the specifics of the concept of “price fixing.” I feel that this may be a case were ‘knowledge is power’ and supporting our community with a deeper understanding will help us all fight back, or at least feel more secure in the face of such claims against our livelihood.” Dees is deliberately defending manufactured home operators/investors, who he indicates include himself.
Dees closing paragraph in that article said: “Wrapping things up, if you were concerned about the suit against Datacomp, I would encourage you to take heart, as a flock of attorneys have already taken the case. There is little evidence to support the claims against the mobile home industry, and once this lawsuit is settled, it will add a new chapter to the law history of the mobile home industry, affording us all greater protection from such claims in the future. Until the suit is over though, I would ask that each of you take the time to learn as much as you can about the types of legal terms and jargon that you may hear being flung about in relation to our livelihood. Learn the terms others use to condemn and use those same terms to protect yourself!”
Immediately following Dees article in MHR is an ad for a manufactured home attorney, err, “mobile home park” attorney. Of course.
Dees appears to be connected to a LinkedIn profile that doesn’t appear to mention his manufactured home communities investing. But that profile does indicate that he served the United States Air Force (USAF) in a “classified” capacity. He’s also been working for a “company” called the “
Jumping back to Rolfe’s article, which is followed by a full-page pitch for Rolfe’s and Reynolds’ “Mobile Home University” (MHU) Frank said the following.
Last, but not least, on the list [of commercial real estate investments] is the lowly “trailer park” which turns out to be the strongest of all the sectors when it comes to surviving the modern cannon ball. Just like the apartment sector, mobile home parks are all about “necessity investing” as they are the Dollar General of housing. But more importantly the lot rents nationwide are insanely cheap (around $300 per month) and could double or triple and still be cheap – which is not an option that apartments share. Additionally – and unlike each and every sector shown above – you have not been able to build new mobile home parks since the 1970s. This cap on the supply maintains extremely favorable supply/demand metrics and creates another medieval reference which is what Warren Buffett calls the “moat”: the barrier to competition that protects your investment. And finally, mobile home parks are by definition “parking lots” and have very low capital needs.
Conclusion
The commercial real estate sector is a big mess. Only two niches will emerge untouched: 1) apartments and 2) mobile home parks. Of these two, I prefer the “trailer park” as it has some unique competitive advantages. But as long as I’m not in office, retail, lodging, self-storage or industrial I’m happy. The carnage coming up for the other niches will make the worst medieval battlefield look good. Who would have ever thought that this is how the commercial real estate industry would end up? I’m sure the knights on the battlefield when that first cannon went off were equally shocked.”
So, Dees – a self-proclaimed wordsmith who for whatever reasons is advocating that those in the manufactured home community sector: “if you were concerned about the suit against Datacomp, I would encourage you to take heart, as a flock of attorneys have already taken the case. There is little evidence to support the claims against the mobile home industry” when earlier in his own article Dees said that the “allegations” were “unfounded.” There is a significant difference, as a linguist or wordsmith should know, between “little evidence to support the claims” and “unfounded,” which by definition from Oxford Languages means: “having no foundation or basis in fact.”
The business model of Rolfe and Reynolds has previously made the pitch for aggressive site fee hikes. Once again, in his latest MHR, Rolfe not too subtly hints at that by saying: “But more importantly the lot rents nationwide are insanely cheap (around $300 per month) and could double or triple and still be cheap.”
Among the articles for this MHProNews week in review is the published research from Marcus and Millichap Inc. (MMI). Look at what MMI said, and the analysis of it, as it relates in several ways to the seemingly wobbly – and as noted above, somewhat self-contradictory – arguments by Dees. The MMI report also sheds light on the notions from Rolfe cited herein above.
Rolfe’s latest reference to Buffett’s “moat” thinking is not his first such comment. MHProNews has spotlighted his remarks in reports like those that follow.
Not all that Rolfe has said is entirely self-serving, or at least, there are times that things that he has said things that can be demonstrably useful in painting a more complete picture of MHVille. Indeed, some of what Rolfe said arguably is harmful to him and his partner’s interests, whether he thought so at the time or not. Some examples follow.
Rolfe and Reynold’s (R&R) have also reportedly been sued by residents. Rolfe and Reynolds apparently responded with a countersuit. How often do you read about the landlords suiing the residents for something other than eviction, rules enforcement, or unpaid rentals/fees? Based on Rolfe’s own words cited above with respect to Nathan Smith (co-founder of what now is called Flagship Communities), did that mean that the duo put the MHC industry at risk?
Rolfe, Dees, or whomever can try to make the argument that the class action suit legal “allegations” were “unfounded.” Will there be a defense? Of course. MHProNews explored that weeks ago by presenting the views of an “industry insider.”
But as we have noted for years, the fact that these “moat” tactics have been deployed for some time now in MHVille with what may seem to some as little or no apparent consequences doesn’t mean that those impacts aren’t looming. Indeed, given the case of those already hit by the national class action suit, they are already here. In terms of Buffett -led Berkshire, even Barron’s indicated that his business practices are risking his ‘good guy’ image, see that in a headline report in the week that was, below.
Those points noted, look again at what Rolfe said about their local monopoly rationale with an added quote for more context. Seriously? R&R have been so apparently brazen that they have likely provided evidence that MHR’s author Dees has conveniently overlooked in his gee, whiz, don’t worry, learn the legal lingo, and keep on going as you did before these lawsuits were launched argument.
Part II
A researcher probing the manufactured home industry contacted MHProNews a few times in recent days. One subject of the digital conversation was the removable chassis topic and pending Congressional legislation.
MHProNews sent this as part of the reply on 12.16.2023. It should prove useful to others who want a quick overview into a subject covered in our week in review, below. Some items are edited out with the ellipsis … as shown.
Part III
What’s New or Recent from Washington, D.C. from MHARR
What’s New or Recent from the Masthead on MHProNews
What’s New at the Daily Business News on MHProNews
Saturday 12.16.2023
Friday 12.15.2023
Thursday 12.14.2023
Wednesday 12.13.2023
Tuesday 12.12.2023
Monday 12.11.2023
Sunday 12.10.2023
Postscript
It is no secret that we don’t ‘cotton’ to the often-aggressive business practices that have been practiced by several MHI member brands. Those business practices appear to violate MHI’s so-called code of ethical conduct. Among the items that seemed to vanish from the publicly accessible side of MHI’s website since they gave their site a face-lift late last summer was that MHI Code of Ethical Conduct. That means that one of the few places online that someone can read all about that piece of posturing is linked below.
Per sources deemed reliable, among those who ‘read all about it’ here on MHProNews are those at RHP Properties and those in one or more of the Rolfe and Reynolds brands. If someone reads MHI’s code above, and looks carefully at the business practices advocated and used by R&R, there is an argument to be made that Rolfe and Reynolds have violated those ‘conduct’ rules several times. Who says? Among others members of the teams of firms who are, or previously were, MHI members. If you can imagine how unhappy thousands upon thousands of residents are living in some of the named communities in the report linked below, then it isn’t hard to picture the tough conditions that numbers of the employees in those firms describe? As the old saying from newspapers’ heydays used to go, ‘Extra! Extra! Read all about it!’ in the article linked below.
As MHProNews has taken pains to note, not every MHI member is a proverbial ‘black hat brand.’ That said, to some, MHI operates a bit like an irksome protection racket. Some who recall MHI during the Chris Stinebert era think that MHI merits four-letter word descriptions.
Rolfe’s MHR article did a snapshot the other segments of commercial real estate (CRE), as was noted in Part I above. For those who trust too much in what Rolfe has to say, consider the following snapshot offered by Bing AI, in response to the inquiry that follows.
> “How sound are the commercial real estate sectors of self-storage, industrial, office space, hotels, and retail?”
As for the soundness of these sectors, it is difficult to make a blanket statement. The performance of each sector is influenced by various factors such as location, economic conditions, and demand-supply dynamics. However, according to Deloitte Insights, the commercial real estate outlook for 2024 is expected to be positive, with a focus on cost optimization and talent management 2.
I hope this information helps!
Learn more
> “There are those who think that the multifamily housing or the “apartment” sector is sounder than others in CRE, as well as those in the manufactured home community sector, which some mistakenly call “mobile home parks” or even “trailer parks.” While each have their advocates, is it fair to say that both the manufactured home community sector and the apartment industry are facing class action lawsuits? While the two sectors are obviously different, are there any similarities between those lawsuits?”
It is true that both sectors have faced class action lawsuits in recent times. For instance, a group of manufactured home community owners were accused of conspiring with a mobile home data valuator to fix, raise, maintain, and/or stabilize lot rental prices for the residences 1. Similarly, some property management companies were accused of conspiring to fix apartment rental prices across metro Denver 2.
While the two sectors are different, the lawsuits share some similarities. Both lawsuits involve allegations of price-fixing and conspiracy to raise rental prices. However, the specifics of each lawsuit are unique to the sector in question 12.
I hope this information helps!
Learn more
Neither Dees nor Rolfe mentioned those more specific and detailed items, did they?
Anyone who follows MHProNews regularly knows that we have warned from time to time against the lemming effect. Just because a strategy is working now, if that strategy is unethical or may seem to be illegal, it doesn’t mean that the strategy will work forever. Perhaps only MHProNews and MHLivingNews have reported on the lessons to be learned from Enron, WorldCom, Madoff, and more recently, Theranos and Sam Bankman Fried (SBF) and FTX.
It would be fair to say that at one point and for a time, we were naïve about some of the business practices that were operating in MHVille, and which MHI and their henchmen apparently helped foster by giving the illusion of legitimacy. Perhaps a bit like some ex-cigarette smokers, once the eyes open wide it is difficult to unsee what someone begins to understand about certain products and services.
It isn’t just tobacco. There may be similar risks – maybe greater? – risks from others that have been exposed by reports that contain award winning documentaries.
They may have little or nothing directly to do with manufactured housing. But that doesn’t mean that they don’t have lessons for manufactured housing residents, investors, and professionals to learn from.
Now that Google has lost a big antitrust suit in California, the concerns that Dees said should be downplayed should rather cause investors, professionals, and advocates alike to lean in and pay more attention. Consider this Q&A with Bing AI/Bing CoPilot.
> “Google has lost an antitrust case tried in California recently, correct? Google said they will appeal the verdict. But what are some of the possible legal takeaways from that case?”
As for the possible legal takeaways from the case, here are some key points to consider:
- Increased scrutiny of Big Tech: The verdict is expected to increase scrutiny of Big Tech companies and their business practices 2.
- Impact on other antitrust cases: The verdict could have implications for other antitrust cases against Big Tech companies, such as Apple and Amazon 2.
- Potential changes to app store policies: The verdict could lead to changes in app store policies and practices, including the fees charged by app stores 1.
- Increased competition: The verdict could lead to increased competition in the app store market, which could benefit consumers 2.
- Impact on Google’s business: The verdict could have a significant impact on Google’s business, particularly if the company is forced to change its app store policies 2.
It is important to note that the case is still ongoing, and the final outcome is yet to be determined. I hope this information helps!
The takeaway from Rolfe and Reynolds? One of several could be these.
There is value in knowing what others say, even if it is in error. There is value in being skeptical when someone is selling something that sounds too good to be true.
By emphasizing their education, degrees, and mastery, MHI leaders are exposing themselves on a host of issues, like DOE, zoning, financing, image/education and the like.
When a train is moving down the tracks, and a vehicle is stuck on the crossing, you don’t have to be a genius to figure out what might happen at some point in the future.
As always, stay tuned to your runaway #1 source for manufactured housing “Industry News, Tips, and Views Pros Can Use” © where “We Provide, You Decide.” © and where for the sound investment in good readingyou can get “Intelligence for Your MHLife.” © ###
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By L.A. “Tony” Kovach – for MHProNews.com.
Tony earned a journalism scholarship and earned numerous awards in history and in manufactured housing.
For example, he earned the prestigious Lottinville Award in history from the University of Oklahoma, where he studied history and business management. He’s a managing member and co-founder of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.
This article reflects the LLC’s and/or the writer’s position and may or may not reflect the views of sponsors or supporters.
Connect on LinkedIn: http://www.linkedin.com/in/latonykovach
Related References:
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