WHY ARE RESIDENT OWNED COMMUNITIES IN SUCH A HURRY TO CONVERT BACK INTO LAND LEASE COMMUNITIES?
In 1984 a Florida state law was passed giving residents the right of first refusal when a community’s owner decided to sell. This triggered a land lease to cooperative conversion phenomenon that spread throughout the state. The trend became even more popular in the 1990s as low interest rates made it easier for residents to borrow money for the purchase. But that was 30 years ago...
Over the years, co-ops experienced the common challenges of shareholder ownership, such as debt buildup, rising insurance costs, risk of storm damage, disagreements over community management, and unfilled rental vacancies. Most co-ops have kept their fees artificially low limiting the needed reserves and expenditures to support the future of the community.
Even the most forward-thinking Co-op Boards have struggled to gain shareholder support for increased maintenance fees and reserves. Now many of these communities are troubled with low cash reserves as deferred maintenance such as roads, storm water systems and other underground utilities suffer. Clubhouses need remodeling and shuffleboard courts sit unused. Many have seawalls and docks that are failing or in need of repairs without the funds or shareholder support to repair them.
Now, we are beginning to see a reversal in that co-op conversion trend. More and more shareholders are looking to retrieve their well-earned equity by selling their shares in today’s peak real estate market, without having to relocate, and without sacrificing their quality of life.
LIFETIME LEASE PROTECTION
MHM Communities’ innovative conversion approach is centered around enhancing the shareholder’s quality of life. In fact, share payouts are often large enough for the shareholders to live in their current home, rent free, for the rest of their life while they enjoy the new amenities and fully renovated infrastructure we will provide.
The MHM Communities conversion process includes:
SUBSTANTIAL SHARE PAYOUTS.
LIFETIME LEASES with minimal increases over current maintenance fees, with guaranteed minimal increases over the lifetime of the lease.
Significant remodeling and new amenities that your residents want in their community (including enhanced security) and guarantees that the capital improvements costs will NOT be passed through to the residents.
Monthly expenses are negotiated before the sale, then guaranteed in writing.
Guarantee that the community will remain a Senior 55+ MHC Community for no less than 30 years after closing.
All negotiated terms are filed in a new Prospectus with Florida's Department of Business and Professional Regulations (DBPR) and cannot be modified by MHM.
Can you imagine having your lot rent and other monthly expense amounts guaranteed, without having to worry about assessments or other costs of maintenance? Start enjoying your resort style community without any of the costs impacting you - GUARANTEED FOR LIFE.
If you would like to know more about our conversion approach, we would love to meet with you in person or via Zoom to develop a free property assessment. The assessment will include a share price appraisal, illustrated property upgrades, and a list of property repair commitments that can be used later to structure an offer to purchase the property.
MHM COMMUNITY OBJECTIVES
In our acquisition process, we search for communities that will benefit from our industry expertise. Our goal is to develop thriving communities and improve the quality of life of our residents by enacting the objectives below:
Enhanced Amenities – Significant remodeling and new amenities designed with your community’s needs in mind. Be it re-purposing older unused amenities or building new amenities, our goal is to provide the environment and features that each resident would enjoy using every day.
Sense of Security – Our management takes the security and comfort of our residents seriously. Each community goes through a full security evaluation. Gating entrances, installing climb-resistant fencing and cloud-based day/night security cameras are standard MHM installations.
Affordability – MHM creates multi-tier options so that Shareholders can choose the lease payment option that best suits them. Each group of options includes lifetime rent guarantees. Some shareholders fear their rents will become unaffordable after they sell their shares so we developed Lifetime Lease options to remove that fear. Each Shareholder can choose their own lifetime rent option. The options range from minimal increases over their current maintenance fees, to slightly higher monthly rents that have larger cash payouts at closing, providing extra money now, so they can enjoy the finer things in life.
Social Funds – Every month MHM allots thousands of dollars for the community to use for social events, gatherings, dances, catered meals, parties and other events. These funds are used at the sole discretion of the HOA or other elected group of residents so that social committees can plan and enjoy without having to worry about selling tickets or taking donations. All residents are welcome to each and every event.
MHM INVESTS IN COMMUNITY
MHM Communities is a dedicated owner of manufactured housing communities specializing in age-qualified 55+ senior communities. We enhance our communities by improving neighborhood infrastructure, building modern amenities, re-purposing old amenities, and expanding social activities. Our residents experience an active and social lifestyle – filled with health, happiness and friendship.
MHM has acquired over $3.0 billion in acquisitions over the past 20+ years. We are very experienced in evaluating and creating offers that are rock solid, no re-trading, and a 99.4% on time closing historical track record. Even during the Covid-19 pandemic, MHM acquired over $500m in communities in Florida with 100% of them closing on time and at our committed price. Our group prides itself on creating customized programs best suited for each community and for each Shareholder.
Our experienced acquisition team has been developing and maturing our relationships over the last 20+ years, gaining the trust and respect of community owners and resident owned co-ops throughout the country.