Business

Out-of-state companies own nearly half of Iowa's manufactured housing lots - and regularly attempt evictions

Teresa Hundley, photographed Feb. 21, has owned a mobile home at Five Seasons mobile home park in Cedar Falls since 2016
Teresa Hundley, photographed Feb. 21, has owned a mobile home at Five Seasons mobile home park in Cedar Falls since 2016. Park owners based in Colorado have unsuccessfully tried to evict her twice. (Liz Martin/The Gazette)
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Laura Lage’s lot rent payment wasn’t top of mind on Feb. 12 as she was leaving her manufactured home — the North Liberty resident already had written her $380 monthly check nearly two weeks earlier.

So she was ”shocked,” she said, to find a legal form taped to her door that afternoon. It asserted she had not paid the amount due and advised that if she did not do so within three days, park owner Havenpark Capital of Orem, Utah, would move to evict her from Golf View Mobile Home Park, where she’s lived since 2005.

Teresa Stevens Hundley found herself in the same boat last summer when Impact Communities of Cedaredge, Colo., twice tried evicting her from Cedar Falls’ Five Seasons mobile home community over $1,340 in late rent and fees that the molding finisher knew she had paid.

Both women resolved their situations. Hundley showed a backlog of check records in court to get her case dismissed, and eventually moved out. Lage alerted the park’s manager of the error minutes before the office closed for the day.

Even so, Lage said she remains concerned: A certified copy of the three-day notice arrived by mail that Saturday, and the notices warn that they remain in force “unless expressly withdrawn in writing,” which as of Thursday Lage had not received.

“I carry the signed receipt (for rent payment) with me everywhere I go, so if I come home throughout the rest of this month, and they’ve boarded up my house because this process is still going on, I still have in my possession the signed receipt that says, ‘No, you paid,’” said Lage, a child care center director. “I’m going to do it every month until forever.”

Lage, Hundley and hundreds of other manufactured home residents have found themselves staring down eviction proceedings, largely over disputed rent or utilities payments, as out-of-state investors acquire a growing share of Iowa’s mobile home parks.

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These out-of-state purchases date back years in Iowa but in 2019 inspired louder opposition from park residents, with support from some Iowa lawmakers, after companies announced sharp lot rent increases and higher utilities charges.

Iowa’s Republican leadership declined to advance manufactured housing bills — intended to bolster tenant rights — out of the state Senate and House judiciary committees by the Legislature’s Feb. 21 “funnel” deadline, citing “free market” concerns.

The Iowa Manufactured Housing Association, which represents more than 200 parks owned both in and out of state, deployed three lobbyists to oppose the proposals. Representatives argued the bills would be bad for business and unnecessary, given existing protections and market realities.

The move has sent a bipartisan group of lawmakers back to the drawing board to determine what, if any, protections could be instituted yet this year for park residents, many of whom are low-income, elderly or disabled, and who often gravitate toward the parks as a key source of affordable housing.

With out-of-state companies’ park-buying spree showing no signs of slowing, “You see a spike in people who all of a sudden can no longer afford to live there and who might be trying to hold on or trying to find a way to survive,” said Alex Kornya, litigation director at Iowa Legal Aid.

Iowa parks lure out-of-state investors

Over the last decade, more investors have been attracted to the manufactured housing sector in part because of “unconsolidated” park ownership among mom-and-pop operations and aging local entrepreneurs looking to sell their communities and retire, said Kevin Borden, executive director of the Washington, D.C., not-for-profit Manufactured Housing Action.

There are at least 549 manufactured housing parks statewide, according to a November report from Iowa’s Legislative Services Agency, featuring data shared by 80 of Iowa’s 99 counties.

The Gazette analyzed property records and business filings for park-owning entities named in the report and found that 74 unique out-of-state people or companies currently oversee 144, or 26.2 percent, of the 549 parks identified in Iowa.

Twenty-three of the 74 out-of-state owners, or 31.1 percent, own two or more parks. By comparison, the 405 parks under in-state ownership belong to 340 unique people or entities — 294, or 86.5 percent of whom own just one park.

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The slice of Iowa’s total manufacturing housing lots owned out-of-state is significantly larger, with those parks encompassing 16,202, or 45.6 percent of the 35,539 home lots identified.

Some manufactured housing buyers aim to acquire “investment-grade” communities with 50 or more lots, Borden said, in discussing the discrepancy between Iowa parks and lots owned out of state.

According to the state’s report, Colorado-based MHP Funds LLC is Iowa’s largest park owner, overseeing 23 parks under two affiliates — Impact Communities, formerly known as RV Horizons, and Strive Communities.

MHP Funds owns at least five more parks in Iowa counties that did not supply data for the state’s report, for a known total of 28.

By comparison, Iowa’s largest in-state manufactured housing owner, Flummerfelt Homes, has seven known parks.

More than a rented lot can be at stake

Under Iowa’s forcible entry and detainer process, a judge can issue an eviction order against a manufactured housing resident in eight to 15 days, after the park owner has properly notified him or her of a violation and that person has failed to correct it within a set time frame.

Depending on the notice, residents have three days to pay overdue rent, seven days to fix other lease violations and 60 days to leave their lot after a landlord has decided not to renew. The park owner then can file a petition seeking a judge’s order.

In reviewing Iowa’s online court records, The Gazette found such petitions filed against at least 198 households at 111 in-state-owned manufactured housing parks, owned by the 46 known in-state owners who oversee two or more parks, since 2018.

Of those cases, a judge dismissed 83 petitions — most without prejudice, leaving the door open for them to be re-filed later — while in 111 other cases the residents were ordered from their manufactured homes. The four remaining cases either involved other resolutions or were ongoing as of Wednesday.

Forcible entry and detainer petition statistics from out-of-state-owned manufactured housing parks suggest that those companies start eviction proceedings at a significantly higher rate.

The Gazette found petitions filed against at least 198 households at 34 manufactured housing parks that were bought since 2018 by 12 out-of-state owners — or less than one-third as many as in state — some operating under up to half a dozen unique LLCs.

Of that total, a judge dismissed 104 petitions, while residents were ordered from their homes in 91 cases. Three other cases involved other resolutions or were ongoing as of Wednesday.

Of the discrepancy, state Rep. Brian Lohse, R-Bondurant, said Iowa owners “are willing to give people a little more opportunity and time (to pay rent) and ... get things caught up, whereas an out-of-state business may not have that same mentality.”

The lion’s share of both in- and out-of-state park owners cited unpaid lot rent or utilities payments in filing the petitions. Lohse, who sponsored the House’s manufactured housing bill, said steep rent hikes likely play a factor.

“When that happens, it’s hard for low-income and fixed-income people to make those rents. ... It’s going to provide more opportunity to evict them,” he said.

In defending one tenant of the Five Seasons mobile home community in Cedar Falls, Iowa Legal Aid attorney Nathan Peters in February 2018 called out what he described in a court filing as Impact Communities’ “pattern of pernicious and ill-mannered tactics with the intent of evicting existing tenants.”

“Mobile home park owners use these tactics to obtain a windfall after a tenant has been evicted leaving a mobile home on the lot,” he wrote. “The tenant’s so-called abandoned mobile home can eventually become the property of the mobile home park owner.”

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After a manufactured housing resident has been evicted, a park owner can file an abandonment petition to take possession of the home. An owner also could give the resident a 60-day window to sell the home, during which the resident cannot live there. If the resident can’t find a buyer in time, the park owner can sell, rent or dispose of the home.

Some park residents have abandoned their manufactured homes without legal prompting. Carrie Presley, who lives in Table Mound Mobile Home Park in Dubuque, said she saw 15 neighbors leave their homes behind in January due to financial hardship.

Presley said she believes this number will grow after a $45 rent increase, from $410, takes effect this week.

“It’s just going to take your breath away in terms of eviction notices and people that are just handing in their keys and titles, just so they can survive,” she said.

Industry contests proposed protections

Iowa lawmakers’ unsuccessful manufactured housing bills this session would have required park owners to justify rent increases above a regional average in mandated 60-day notices sent to residents, doubled that notice period to 180 days and replaced the current “no cause” eviction option with a “just cause” requirement.

Those bills would have had “atrocious” impacts on park owners, said Troy Hames, general manager of Cedar Rapids-based Hames Homes and a board member of the not-for-profit Iowa Manufactured Housing Association.

Hames said the rent justification and notice period provisions would not affect his business. However, with “just cause” evictions — requiring a “material” violation before a park owner could end a lease — owners could be unable to remove residents whose violations aren’t spelled out in the park’s rules, he said.

“I don’t have that in my rules, where it says, ‘Hey, please don’t shoot fireworks into other people’s homes, please don’t start fires behind other people’s houses,’” Hames said, citing examples he’s seen at his three parks.

Hames said “no cause” evictions are unusual at his parks, at an estimated three or four per year. For violations other than unpaid rent, officials will meet with and give residents a chance to correct deficiencies before moving to end their lease.

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At a Feb. 17 bill hearing, association attorney Jodie McDougal also described the required rent justifications as “overly burdensome” and said they could cause a “chilling effect” on sales of parks to buyers looking to preserve them as affordable housing.

As to whether he and other association representatives could work with lawmakers on future legislation, Hames said, “I’d like to hear what they have to say and go from there.”

Hames said he sympathizes with residents who have spoken out about hardships faced under out-of-state owners, but believes they do not speak for the vast majority of Iowa’s 50,464 manufactured housing residents.

“It was a small minority of people in Dubuque, Waukee and North Liberty (parks) that were purchased by out-of-state corporations, and it was not a relevant sample of the people that live in manufactured homes that are happy where they’re living and don’t want the laws changed,” he said.

State Sen. Zach Wahls, D-Coralville, said he believes there’s a “world of difference,” though, between manufactured housing parks owned in and out of state.

Wahls, who sponsored the Senate bill, said he still hopes protections can be enacted this session with amendments to a still-live manufactured housing bill lawmakers failed to pass during the 2019 session’s final week.

“Folks who live here (in Iowa), for whom their residents are their neighbors, they take this responsibility of being a landlord not just seriously but personally,” he said. “I think for these investment groups, the people who live in their communities aren’t neighbors, they’re numbers, and we need to make sure that the law protects those Iowans, too.”

Comments: (319) 398-8366; thomas.friestad@thegazette.com

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