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Acquisition, and Rumors of a Billion Dollar Acquisition, for Hometown America

April 25th, 2017 Comments off
GatewayLifestylesHometownAmerica-Logos-postedMHProNews-

Credit: Gateway Lifestyle, Hometown America.

In Australia, manufactured home builder and community owner Gateway Lifestyle Group has seen significant growth since the Daily Business News reported a potential deal with Hometown America last August to purchase National Lifestyle Villages (NLV), Western Australia’s largest operator of manufactured home communities.

At the time, the proposed deal would have entailed Gateway acquiring NLV’s land holdings and project pipeline, while Hometown would obtain the company’s passive investment income stream currently held by private equity giant Blackstone.

Blackstone had entertained a possible sell of their portfolio stake for a rumored $225 million, although official comments from the firm said they were “not actively seeking.”

According to The Australian, the manufactured home estate (MHE) segment in the country focuses on providing affordable community living to people 55 and over, similar to the seniors-only communities in the U.S.

Gateway Lifestyle Group was created in 2009, and now owns and operates 55 communities, with more than 9,400 individual sites for manufactured homes.

With the Australian manufactured home market in its early stages, significant opportunity exists. And that has put Hometown and Gateway Lifestyle Group in a potential head-to-head battle.

GatewayLifestylechartGraphic-creditAustralian-postedDailyBusinessNewsMHProNews595x329

Credit: The Australian.

Most MHEs in the country are privately owned and operated, so the market is highly fragmented. This provides for significant opportunities for acquisitions, and analysts project that the current pipeline of opportunities will provide several years of growth via underfunded retirees who need affordable housing.

In recent weeks, Hometown America decided to formally enter the Australian market via a MHE purchase in Port Macquarie through its subsidiary Hometown Australia.

This move is in addition to a November 2016 rumor that Hometown America was planning a takeover bid for Gateway Lifestyle and Ingenia Communities, valued in excess of $1 billion.

It was suggested that Bank of America Merrill Lynch could be involved in a prospective transaction, but who would actually be involved remains unclear. The Australian reported that Gateway could fetch a purchase price in excess of $643 million.

MHCWeighsAcquisitionOfferUnderStrangeCircumstancescreditBriarcrestEstates-postedtothedailybusinessnewsmhpronewsmhlivingnews

Credit: Briarcrest Estates.

Founded in 1997, Hometown America is a privately held company that owns and operates manufactured housing communities across the country. Today, the company operates more than 45 communities in ten states in the U.S.

For more on Hometown America, including their proposed acquisition of Laconia, New Hampshire-based Briarcrest Estates, click here. ##

(Image credits are as shown above, and when provided by third parties, are shared under fair use guidelines.)

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews

Drama, Take Three – MHC Infighting Over Potential Sale

April 20th, 2017 Comments off
MHCWeighsAcquisitionOfferUnderStrangeCircumstancescreditZillowBriarcrestEstates-postedtothedailybusinessnewsmhpronewsmhlivingnews

A home in Briarcrest Estates. Credit: Zillow.

In the ongoing saga of Laconia, New Hampshire – based Briarcrest Estates, both the tempers, and stakes, are higher than ever.

According to the Laconia Daily Sun, Briarcrest co-op board members Joe McCarthy, Don Vachon and John Drouin have resigned from the six-member board, after they came under fire over a proposal to sell the community to Hometown America Corporation.

A special meeting has been called for April 24 to fill the vacancies, and another meeting has been set for May 20 to consider selling the community.

As the Daily Business News covered here, the Briarcrest story dates back to July 2013, when community owners Mark and Ruth Mooney tentatively agreed to sell the Briarcrest Estates to Hometown America for $10 million. In compliance with state law, the terms of the transaction were disclosed to the tenants, who had 60 days to make a counteroffer by presenting a purchase-and-sales agreement. The law requires the community owner to bargain in good faith with the residents or their organization.

Residents of Briarcrest Estates then formed The Lakemont Cooperative Inc. and, with assistance from ROC-USA and the New Hampshire Community Loan Fund, matched the offer from Hometown America Corporation.

After initial resistance, Mark and Ruth Mooney agreed to sell the 183 acre, 241 home site community to the cooperative, which has owned and managed it since April 2014.

EditorialResidentOpposesSaletoHometownAmericacreditGoogle-postedtothedailybusinessnewsmhpronewsmhlivingnews

Credit: Google.

Fast forward to January 2017, when things changed. That change came in the form of a offer to buy Briarcrest Estates.

It was from Hometown America.

It’s an unsolicited offer, period. A fire-from-the hip” proposal, said Vachon at the time.

The Hometown America deal reportedly included retiring the outstanding balances on a $8 million loan from TD Bank and $2 million loan from the New Hampshire Community Loan Fund as well as covering the prepayment penalty of $873,000 on the bank loan, closing costs and real estate transfer taxes associated with the transaction.

For some residents, the timing was “convenient.”

Although the board has claimed the offer was not solicited, the letter from Hometown America Corporation outlining its terms begins ‘per our discussions,’ indicating that board members have been communicating with Hometown America for some time,” said Katherine Carlson, who also was among the first officers of the cooperative.

MHCWeighsAcquisitionOfferUnderStrangeCircumstancescreditBriarcrestEstates-postedtothedailybusinessnewsmhpronewsmhlivingnews

Credit: Briarcrest Estates.

Residents in the community say that it has become a neighbor-versus-neighbor battle, with one faction wanting to sell the community, and the other wanting it to remain a cooperative.

It’s just been ridiculous,” said McCarthy’s wife, Carrie, who said her husband and the other board members were unfairly targeted for suggesting cooperative members consider an unsolicited purchase offer.

There are a small number of people in this park [sic] who are so toxic,” said McCarthy.

All they are trying to do is stop the vote. It’s not all wonderful here in the co-op. People fight and argue. It’s like something you’d see on TV.”

Resident Louise Rosand, who is in favor of remaining a co-op, says that the ability to avoid rent hikes and keep control of the community are both critical. She also feels that the three board members who resigned were not completely honest about the situation with Hometown America.

They went behind our backs,” Rosand said. “There is no financial reason to sell. We are in good standing. We have extra money to put away. The bank loves us. The park has been running smoothly.

It’s kind of like a group against group. Your neighbor could be for or against. I live in a little section where there are four of us who are not for the sale, but if you go down the street you may find somebody who is for the sale. But you don’t go in your backyard and yell. You wave at everybody who goes by.”

 

ROC USA Commentary

An unrelated ROC USA community. Credit: ROC USA.

The ROC-NH program of the New Hampshire Community Loan Fund has helped convert nearly all of that state’s resident-owned communities, now numbering over a hundred. ROC-NH Director Tara Reardon told MHProNews it often takes time for a new cooperative to develop leaders and grow into what will become that community’s personality.

We’re confident that, if the process is transparent, the residents at Briarcrest will make the right decision for their neighbors’ and their own futures,” said Reardon.

Mike_Bullard_Marketing_and_Communications_Mgr_at_ROC_USA

Mike Bullard. Credit: Linkedin.

ROC Members are empowered to make decisions for themselves and their communities. Democracy, as they say, isn’t always pretty, I think we can agree in the wake of last year’s elections, that’s a fact,” said Mike Bullard, ROC USA Communications and Marketing Manager, in an email to MHProNews.

But making a tough decision, or even a bad decision is better than having no choice at all.” ##

 

(Image credits are as shown above, and when provided by third parties, are shared under fair use guidelines.)

 

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.

Editorial: Resident Opposes Sale to Hometown America

March 23rd, 2017 Comments off
MHCWeighsAcquisitionOfferUnderStrangeCircumstancescreditBriarcrestEstates2-postedtothedailybusinessnewsmhpronewsmhlivingnews

Credit: Briarcrest Estates.

In a contentious story that the Daily Business News covered here, the alleged on and off discussions to sell Laconia, New Hampshire- based Briarcrest Estates to Hometown America has one resident choosing to utilize the power of the media to make their point.

According to the Laconia Daily Sun, the story dates back to July 2013, when community owners Mark and Ruth Mooney tentatively agreed to sell the Briarcrest Estates to Hometown America for $10 million.

In compliance with state law, the terms of the transaction were disclosed to the tenants, who had 60 days to make a counteroffer by presenting a purchase-and-sales agreement. The law requires the community owner to bargain in good faith with the residents or their organization.

Residents of Briarcrest Estates then formed The Lakemont Cooperative Inc. and, with assistance from the New Hampshire Community Loan Fund, matched the offer from Hometown America Corporation.

After initial resistance, Mark and Ruth Mooney agreed to sell the 183 acre, 241 home site community to the cooperative, which has owned and managed it since April 2014.

MHCWeighsAcquisitionOfferUnderStrangeCircumstancescreditBriarcrestEstates-postedtothedailybusinessnewsmhpronewsmhlivingnews

Credit: Briarcrest Estates.

Fast forward to January 17th of this year.

Doug Minahan of Hometown America Corporation wrote a letter to cooperative President Don Vachon.

Doug Minahan. Credit: LinkedIn.

It was an offer to buy Briarcrest Estates.

It’s an unsolicited offer, period. A fire-from-the hip” proposal, said Vachon at the time.

The Hometown America deal reportedly included retiring the outstanding balances on a $8 million loan from TD Bank and $2 million loan from the New Hampshire Community Loan Fund as well as covering the prepayment penalty of $873,000 on the bank loan, closing costs and real estate transfer taxes associated with the transaction.

But for some residents, they claim that the timing was “convenient.

Although the board has claimed the offer was not solicited, the letter from Hometown America Corporation outlining its terms begins ‘per our discussions,’ indicating that board members have been communicating with Hometown America for some time,” said Katherine Carlson, who also was among the first officers of the cooperative.

 

A Letter to the Editor

MHCWeighsAcquisitionOfferUnderStrangeCircumstancescreditZillowBriarcrestEstates-postedtothedailybusinessnewsmhpronewsmhlivingnews

A home in Briarcrest Estates. Credit: Zillow.

Earlier this week, resident Barbara Patterson decided to take matters into her own hands, with a letter to the editor.

Everyone has heard of Briarcrest. It’s a manufactured housing park [sic] consisting of 240 very well maintained homes on the side of Prescott Hill, within a hop, skip and jump of Laconia and Winnisquam, Paugus, Opechee and Lake Winnipesaukee,” said Patterson, in her letter to the Laconia Daily Sun.

We are very proud of our community and three and a half years ago, Mark and Ruth Mooney put it up for sale for $10 million.

Patterson then spoke to the process that residents went through.

During our formation, our very hardworking resident investment banker, our resident Merrrimack County administrator and many, many other hardworking, talented individuals — joined eventually by our resident paralegal — worked closely with ROC and formed a co-op to govern ourselves. ROC USA is a New Hampshire social venture working to make quality ownership viable for homeowners in manufactured home parks [sic],” said Patterson, who then provided her view on Hometown America.

Now our co-op is threatened by the same buyer from Chicago who originally made an offer to buy Briarcrest: Hometown America. Our second board of directors has been negotiating with Hometown since November, unbeknownst to the majority of the 230 resident owners not on the board. Originally, we were assured that we would never be sold again and I, for one, believed it,” said Patterson.

But the current board of directors has been in direct contact and providing financial information to Hometown America without our knowledge or the membership’s authorization to do so. We believe this is a breach of trust. The board is attempting to limit our discussions and have made a date for Hometown America to make a presentation to the membership and a date for a special membership meeting, although they have yet to tell us what we will be voting for.

EditorialResidentOpposesSaletoHometownAmericacreditGoogle-postedtothedailybusinessnewsmhpronewsmhlivingnews

Credit: Google.

Patterson also points to her opinion that some new owners, or seasonal residents, may not completely understand the impact of a vote for new ownership.

Some of our new owners are not aware of the serious consequences of a vote for a private owner such as Hometown America and their ability to raise our rents hundreds of dollars to help pay its own considerable debt, or to sell us to another buyer. We lose all control over our rents, rules and management,” said Patterson.

Hometown America’s reputation is less than stellar and squeaky clean. Numerous lawsuits have been filed against Hometown in states in which they own parks [sic]. We, as a co-op, want to maintain our low rents, our own governorship, and our beautiful community.”

The Daily Business News will continue to watch this story closely and provide updates. ##

 

(Image credits are as shown above.)

 

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.

Local official surprised by Attorney General’s suit against modular developer

September 30th, 2011 Comments off

Michael Delaney New Hampshire's Attorney General -credit DOJ-NH-GOVLaconiaDailySun reports on ‘surprise’ legal action by New Hampshire’s Attorney General Michael Delaney’s Office. In a follow up to the story covered earlier this week in MHProNews.com, Shanna Saunders said the city code enforcement office had been working with the developer and home owners to resolve some complains, but never expected the NH AG’s office to file suit. “I knew people were coming to the office and looking at their files,” Saunders said. Saunders explained the Villa at Paugus Woods was originally approved by the city planning board in 2006 as a cluster subdivision for a U.S. Department of Housing Urban Development (HUD) Code single-family manufactured homes. “I think when this was approved these had HUD stamped on it,” she said, noting that manufactured housing are built to federal HUD Code standards for manufactured housing and doesn’t required local inspections except for site work, like roads, drainage and the sewer systems and hookups to services like electricity, water and sewage. At some point, the project apparently changed from HUD Code manufactured housing to modular home construction. Former city contract code enforcement officer Jim Van Valkenburgh explained modular home ares engineered and built in factories and the design engineers and subcontractors are the ones responsible for design defects. “Each modular house also has a manufacturer’s sticker number with an identification number on the outside,” he said. “This means it was acceptable to our department of safety,” Van Valkenburgh said. He said that as the contracted code enforcement officer, all inspections were made as mandated by Laconia’s adopted International Residential Code of 2006, so he disagrees with the allegations in Delaney’s lawsuit that says life-safety issues are compromised. “I would not sign a certificate of occupancy without it meeting the minimum code standards of the residential building code,” he wrote. Brady Sullivan with the Villa at Paugus Woods development stated that he had cooperated with officials and that they would be vindicated.

(Photo credit: NH-DOJ)

 

Attorney General files against MH Developer

September 29th, 2011 Comments off

E:1 SK MHMSMDaily Buisness Newslaw,_scales_and_gavel_Wikimedia_Commons_posted_manufactured_home_marketing_sales_management_MHMSM.com_MHProNews.com_.pngBoston reports that New Hampshire’s attorney general has filed suit against the developers of Lake Winnipesaukee area housing complex, The suit alleges safety and building code violations, which the developer Arthur Sullivan denies. The legal pleadings claim many of the 93 modular homes at the Villas at Paugus Bay in Laconia do not comply with basic building code standards. The suit also claims the homes in question violate electrical codes and some are not bolted together properly, potentially endangering homeowners. Homes currently on the market are priced in the $160,000-$170,000 range, and are located about a mile from Lake Winnipesaukee’s Weirs Beach. A spokesperson at Brady Sullivan Paugus Woods, developers of the project, stated that each home passed inspection prior to sale.

(Photo credit: Wikimedia Commons)