The increased investment interest in manufactured home communities is similar to that seen in recent years for multifamily properties, according Mark Weiner, chief financial officer for Storz Management, Orangeville, California. “Unlike apartments, manufactured home communities only rent space rather than the living units themselves, which are still owned by the residents,” he explained. “Not only does that significantly reduce maintenance costs, it gives residents equity if they live in a park with rising value.”

Weiner said Storz, which operates more than 40 manufactured home and recreational vehicle communities, has received more attention from bank lenders in recent months who are lured by the prospect of strong returns.

The Sacramento Business Journal  tells MHProNews  that Storz Management just closed refinancing on loans for two properties: Mobile Country Club in Rancho Cordova, California, and Meadowbrook Manufactured Home Community in Antelope, California. “A lot of these big banks were bidding on it,” Storz said. “The $10 million financing for Meadowbrook was for a 10-year loan with a 3.75 percent interest rate, strong for such properties.”

He explained that Meadowbrook got the financing from Voya Investment Management, while another lender refinanced $15 million for the Mobile Country Club. Weiner said he’s also on the verge of obtaining $20 million in refinancing for other manufactured home property loans with Freddie Mac.

“Such properties are not only good investments now, but are set to become more so in the future,” Weiner said. “Developers rarely build new parks or communities anymore, and in particularly desirable communities, they’re being demolished to make the way for more lucrative housing projects.” However, he explained that in California, demographic trends suggest that both retirees and working-class residents will demand such communities as affordable options.

From his experience, Weiner believes that among real estate investments, no segment provides a better risk-adjusted return to investors than manufactured home communities. And, unlike most real estate segments, the lack of new manufactured home communities coupled with a growing population and demand for moderately-priced housing continues to create simple, but substantial economic benefit for manufactured home community investors. He added, “Better yet is that American manufactured home communities can never be ‘off-shored.’”

Weiner stated that his company, Storz Management has led the acquisition of more than 25 parks by pooling approximately $200 million in invested capital over the years. “This strategy has provided sound investment diversity and exceptional returns for our investors, as well as sustainable asset value for future generations,” he added.  ##

See related article, Investors Discover the Walmart of Affordable Housing.

(Photo Credit: Storz Management)

Article Submitted by Sandra Lane to – Daily Business News- MHProNews.