MHProNews has learned that the Carefree Portfolio Trust 2014-CARE is a Commercial Mortgage Backed Securities (CMBS) single borrower transaction. It is collateralized by a $650.0 million floating rate loan co-originated by JPMorgan Chase Bank, National Association, an affiliate of Goldman Sachs Mortgage Company, and Citigroup Global Markets Realty Corp..
The collateral acquired is in three distinct portfolios comprising 31 manufactured housing communities, 31 extended-stay recreational vehicles (RV) resorts and six vacation/leisure RV resorts. Occupancy in June 2014 was reported at 82.6%. Since 2007, some $34.7 million – or $1,756 per pad – was invested in CapX and related improvements. Per Business-Wire:
- The California Portfolio (38.4%) consists of 18 manufactured housing communities, for a total of 4,530 pads, which are all located in California. The properties were built from 1910 to 1977 and $20.6 million ($4,539/pad) was expended on renovations between 2006 and 2013. As of June 2014, this portfolio had an average occupancy of 98.4%.
- The Legacy Portfolio (39.3%) consists of 29 extended-stay RV resorts, 13 manufactured housing communities and six RV resorts totaling 11,910 pads. The properties are primarily located in Florida (82.0%), Texas (6.9%) and Massachusetts (3.8%). The properties were built from 1938 to 1993, and $1.7 million ($519/pad) was expended on renovations from 2007 to 2013. As of June 2014, this portfolio had an average occupancy of 78.9%.
- The Premier Portfolio (22.3%) consists of two extended-stay RV resorts with 3,238 pads. These properties are located in Sarasota, Florida (56.0%) and Ontario, Canada (44.0%). The properties were built in 1955 and 1959 and $12.4 million ($1,100/pad) has been expended on renovations from 2012 to 2013. As of June 2014, this portfolio had an average occupancy of 74.0%.
In addition Business Wire says it was determined “KBRA net cash flow (KNCF) for each asset, and applied KBRA capitalization rates to each property’s KNCF to determine property value. The aggregate variance to the issuer’s NCF was 4.1%, and the aggregate value variance to the portfolio’s appraised value was 34.5%. The analysis produced an aggregate KBRA value of $690.0 million and an in-trust KLTV of 94.2%.”
KBRA’s rating is a reflection in the confidence held by the investment sector in the manufactured home community (MHC) business. It also suggests that there is confidence in the broader MH industry.
When viewed through the prism of an ongoing interest by Investors Discovering the Walmart of Affordable Housing and the just announced SUN aquisition, there are positive signals in the market and its potential coming from consumers and investors alike. ##
(Photo/Image credits: PRNewswire – Carefree Communities & Kroll Bond Rating Agency Logo. Graphic credit: Carefree Trust-Kroll.)
