The Sans Souci Community is something of a manufactured housing success story, at least so far. In late June, the residents of the nearly-11-acre property off Highway 93 in unincorporated Boulder County purchased the mobile home park from its corporate owners for $3.3 million. Sans Souci (“without worry” in French) is now completely resident-owned.
“The overarching goal is autonomy and security,” says Michael Peirce, Sans Souci resident and president of the co-op that just purchased the park south of Boulder. “So to be autonomous, you need affordability and control over your living circumstances.”
Seen as the largest reserve of unsubsidized affordable housing in the country, preserving manufactured home communities is a priority for state and local leaders grappling with unaffordability across the region. Bolstered by a new Colorado opportunity-to-purchase law and supported by a national nonprofit that specializes in resident-owned communities, Sans Souci has become a beacon of hope for other manufactured housing communities.
But some of the challenges of resident-owned communities are just starting to surface in Colorado, as there are only five such parks across the state, all purchased by residents in the last two years. In order to secure financing for the park, Sans Souci residents chose to increase their rent by $150 a month. There may also be additional infrastructure costs to account for flood mitigation, replacing a self-contained water system, and updating its sewer plant, among other projects.
Already, other communities in the area are facing the realities of running their own parks, and some limitations in the new opportunity-to-purchase law, which requires mobile home park owners to notify residents of intended sale, allowing them 90 days to put together a purchase offer themselves. Residents at Table Mesa Village, just across the highway from Sans Souci, have submitted several offers to purchase their park, all of which have gone unanswered. And a community in Fort Collins recently failed to put together an offer to purchase their park.
“It is a huge challenge to achieve success under this new [opportunity-to-purchase] timeline,” says Andy Kadlec, program director for Thistle ROC, the Colorado affiliate of the national nonprofit ROC USA. “We’ve done it, but it’s a challenge.”
Getting priced out of “affordable housing”
The issues surrounding manufactured housing communities are well documented. It’s hard to talk to anyone working in the space and not hear about John Oliver’s 2019 segment exploring the predatory practices of some park owners.
At most mobile home parks, property owners lease lots to residents, charge rent, and in some cases, draw water utilities off a single meter. For years, mom-and-pop owners around the country have increased rents incrementally, perhaps more in certain years to cover infrastructure costs. Whether to keep prices low or due to mismanagement, many parks have delayed maintenance of key infrastructure like water pipes, roads, electrical lines, and more. While this is catching up to a lot of parks, it has kept them affordable for a lot of homeowners, many whose mobile homes depreciate in value each year, unlike most other real estate investments.
Increasingly, local park owners are retiring, making way for investors and corporate owners to institute new park policies and restrictions and raise lot rents to market rate, forcing many long-term residents out. Despite common nomenclature, mobile homes are not really mobile, costing anywhere from $8,000 to $22,000 to relocate. In essence, despite owning their homes, residents feel powerless when up against the forces of park owners.
With inflated real estate prices and a lack of affordable housing, Colorado—Boulder County in particular—is all too familiar with these issues. In many cases, the high cost of living exacerbates them.
Preserving and expanding manufactured housing opportunities is part of the long-term strategy of the Boulder Valley Comprehensive Plan. And it’s a priority for the City of Boulder, which first changed its zoning laws in 1985 to prevent the rezoning and redevelopment of mobile home parks.
“It is a different type of a sense of community that is really important to the folks who live there and really important to us as Boulder,” says Brenda Ritenhour, neighborhood liaison for the City of Boulder. “I think it strengthens our diversity in the city.”
Several years ago, the city started convening the Coalition of Manufactured-home Owners in Boulder, or CMOB, which has served as an important resource for many residents of the area’s manufactured housing communities (the group has no regulatory or policy-making authority.)
It was at a CMOB meeting Boulder Representative Edie Hooton first heard about the issues in mobile home parks.
“The people who own mobile homes . . . It is their primary asset. It’s their retirement, it’s their home, but they are beholden to basically the whims of a park owner, on frequency of raising lot rent, on maintenance of the property . . . What they can get away with in respect to utility billing . . . and who’s overseeing the metering,” Hooton says.
In collaboration with CMOB, park residents, the City and County of Boulder, and the Sustainable Community Development Clinic at CU Boulder, Hooton spearheaded efforts in the state legislature to address issues facing mobile home owners. This led to a series of new laws in the last few years, most notably updates to the Mobile Home Park Act, including a robust dispute resolution mechanism monitored by the state through the Department of Local Affairs, as well as the opportunity for the homeowners to purchase land.
“This has always been my end game—homeowners own their own community, that they have a homeowners association that works together on responsibilities for private property maintenance, community property maintenance, they just make all the decisions the park owners do without ulterior motives and a reasonable lot rent that will cover the costs of maintaining a community,” Hooton says. “And they work on that together.”
Preserve and stabilize
For years, Sans Souci was a local mom-and-pop operation whose owners more or less left residents alone barring a serious issue, says Peirce.
“There was a saying in the park: ‘The best thing about our owners is they don’t do much. And the worst thing about our ownership, they don’t do much,’” he says. “All of that changed when corporate owners took over.”
The 2018 sale caught park residents by surprise. Previously, some residents expressed interest in purchasing the park, but the owners had told residents they weren’t interested in selling. Then residents came home to a notice saying the park had been sold.
“When the heavy-handed management practices came in, everybody came out and said, ‘Well, we’ve gotta do something about this,’” Peirce says.
Peirce has been in the park since 1995, when he began working in the philosophy department at CU Boulder. Several residents have been there even longer. Historic rent increases were rarely more than three percent a year, and typically under two percent, he says. But just before the park sold, rents increased by about 12 percent, a hike that continued under the corporate owners.
In 2019, several residents, including Peirce, helped CMOB and others draft new legislation, even though they didn’t expect their park to go up for sale anytime soon.
“That kind of dropped out of the sky unexpectedly,” Peirce says. “Weirdly, we had worked on getting this legislation going and ended up being one of the first parks to be able to take advantage of the new law.”
Modeled off other state statutes and national standards, Colorado’s 2019 opportunity-to-purchase law is not a first right of refusal for residents. Rather, it’s intended to increase transparency in the process of a park’s sale, and provide an opportunity to residents to purchase their park with a competitive market-rate offer.
“It’s all about the market,” says Mike Bullard, marketing and communications manager for ROC USA. “These communities are investments for commercial owners, and we understand that. But we don’t want them to continue to be. It’s getting people’s homes out of the speculative real estate market.”
ROC USA launched in 2008—born out of a previously successful model operating in New Hampshire since 1984—offering limited-equity loans to co-ops purchasing manufactured housing communities. Nowadays, about a third of all mobile home parks in New Hampshire are organized resident-owned communities, Bullard says, and ROC operates in 20 states, supporting 278 communities, representing 19,000 homes.
Under the ROC model, residents of a park vote to form a co-op that then appeals to lenders in order to make an offer. ROC USA works closely with its subsidiary ROC USA Capital in financing such purchases, offering a limited-equity loan up to 110 percent of the purchase price that includes pre-development funds for the community to hire experts like engineers and attorneys to ensure due diligence. If a deal falls through, the pre-development loan is forgivable. If it’s successful, that cost rolls over into the acquisition loan.
“Sometimes this seems too good to be true, but this is what we do,” Bullard says. And compared to traditional commercial loans, where park residents would have to come up with a 20-to-25 percent down payment, it might be.
In ROC’s limited-equity co-op model, “The profit margin is taken out of the equation,” Bullard says.
In order to work with ROC USA, the maximum one-time member share is $1,000, but each community sets its own price, Bullard says. Almost all the communities in partnership with ROC USA have rates between $100 and $250.
“That’s the extent of people’s personal financial skin in the game,” he says.
If a resident moves, the fee is returned to them and the next person who moves in will then pay the one-time fee. Homeowners still pay lot rents, but instead of paying to a landlord that money goes toward paying off the loan, property taxes on the park, operating costs, insurance, utilities, and other expenses.
To date, all resident-owned communities in the ROC model are successful, with no defaults or reversion back to private ownership.
Although initially some residents see a cost increase in the first few years of community ownership, like Sans Souci, it eventually stabilizes, Bullard says.
“What we found is that within five years of resident ownership, all but one community was back down to market level rents or below,” he says. One community even had rents that were 22 percent below market rate, he adds.
On average, resident-owned communities raise site rents about 0.9 percent annually. The average rent increase in commercially owned communities is 3.9 percent, according to the Manufactured Housing Institute.
And although affordability is important, the ROC model is about more than the cost, adds Kadlec, with Thistle ROC.
“It’s about preservation and it’s about control and power,” he says. “We’re giving these residents the opportunity to really have some self-determination and some decision making in the way their communities are owned and operated for the first time probably ever. The numbers always speak the strongest, but I think it’s always important to remember that this is more than just tomorrow—it’s for the rest of their lives, that decision to preserve and stabilize.”
There are some limitations to the ROC model, however. First and foremost, the sale of a community to a co-op depends on both a willing seller and buy-in from residents. Securing financing, especially in the 90-day window allotted by the Colorado law, can also be a challenge.
‘What’s the beef?’
In states without an opportunity-to-purchase law, Bullard says the organization focuses its efforts on building relationships with park owners and brokers more than homeowners, so that when they’re ready to sell, the controlling entities turn first to the residents and the ROC model.
“We only work in communities where the owner is willing to sell to the homeowners, because if they’re not, there’s no opportunity, period,” he says.
In 2019, the 36 residents of the Longmont Mobile Home Community, with help from Thistle and the City of Longmont, were able to purchase their park for about $3.2 million by forming the LMP Co-op.
LMP became the second resident-owned community in the state, and because the sale went through prior to the new law taking effect, the key to its success was a willing seller.
“It was really helpful to have an owner engaged in the process and wanting to work with us,” Kadlec says. “He wanted to sell to the residents and wanted to leave a legacy.”
The residents almost unanimously agreed to raise their own lot rents in order to purchase the park—about $100 to $125 each, according to Kadlec. Now they pay roughly $700 a month.
“When the opportunity came up for us to buy the community, it was pretty exciting,” former co-op president Mike King told ROC USA at the time. “We own it and are able to set the lot rent based upon an actual budget.”
In general, however, park owners around the state were resistant to opportunity-to-purchase and similar manufactured housing legislation, according to Hooton. The law was seen as an abdication of their authority as a property owner, she says.
“Even though we’re not asking them to give up all authority . . . They maintain their rights as property owners to basically raise lot rents and decide who they want to sell their property to like any other private property owner,” she says. “So what’s the beef? If they’re asking for $20 million for their park and the homeowners put up $20 million to purchase the park, why does it matter who they sell to?”
Susan Gibson has lived in her home in Table Mesa Village, just south of Boulder off Highway 93 in unincorporated Boulder County, for 25 years. When she first moved in, her lot rent was $235, she says, which was great considering she’s never worked for much more than minimum wage.
Rent only went up about $10 or so a year, usually—one year it was $15 to pay for an infrastructure project—so five years ago she was paying $475 a month. “Which was why most of us old-timers moved here, because we thought this is a place we can live, where we can afford to live on whatever our low income is. Or some people just choose to be creative instead of hustling or whatever,” Gibson says.
Then the property sold to a new owner, Zane Blackmer, in 2016, with little warning to the residents. Now rent is $800, Gibson says. Since the sale, Gibson and other residents organized into an informal HOA, began attending CMOB meetings, and testified at the state capitol in support of the opportunity-to-purchase law, inspired by the success of LMP
So when Blackmer notified residents of his intent to sell in 2020, Gibson says it was fairly easy to organize the group into a co-op and, with the help of Thistle, submit an offer. However, Blackmer did not respond to the group’s initial offer, so they made him two more offers, each time raising the price, with no response.
“We just don’t know what to do,” Gibson says. “There’s nothing we can do to make him accept any offers from us at this point.”
When reached for comment, Blackmer declined.
Gibson says the offer was more than double what Sans Souci was eventually purchased for.
“The cost of the trailer park should be based on the number of lots and the amenities,” she says. “We have zero amenities. There’s no playground here. There’s no swimming pool here. There’s barely any trees here. So we actually should be less per lot than a trailer park like Sans Souci, which at least has a playground.”
With each unanswered offer, Gibson says support for the idea waned as the cost per resident increased. The last offer they submitted would have increased monthly rents to just over $1,100. But the residents say they still have never heard from Blackmer, and the property is no longer listed for sale.
The dilemma of displacement
One of the largest challenges to the ROC model is not just getting the financing together, but doing it in a way that keeps parks affordable for residents. Like other forms of real estate, it’s reliant on and given to whims of market forces.
Purchasing the parks at market rate inevitably raises lot rents two or three years in advance to be competitive, Peirce says, at least for most parks. For Sans Souci, that means lot fees just went up to $750 from $605 in the beginning of September. In the coming months, they may increase again to $800 and then $856 before stabilizing to an average increase of about one percent a year to account for cost of living increases.
“We knew that that was going to be tough and that the market rate wasn’t going to be sustainable for many of the residents,” he says.
The additional cost of capital improvement projects—beyond the acquisition price—accounts for some of the rent increase, however. And there is a chance, Peirce says, that with additional funding the Sans Souci co-op will be able to keep prices below $800. In early August, the co-op received a $1 million grant from the State Housing Board that should help, and perhaps allow the co-op to set up a rent relief fund for the lowest income residents.
“Just about every park right now that can take advantage of the opportunity-to-purchase law is facing this dilemma that they can stabilize their prices, but they can’t stabilize them at a place where we’re preventing major displacement. And so there’s gotta be a way for other funds to be made available,” he says.
Additional support and partnerships are often necessary to make the financing for resident-owned communities to work. In Colorado, the state has awarded $3.4 million in grants or zero-interest cash flow loans in the five deals that have been successful. Local foundations and nonprofits have contributed as well, bringing funds to purchase as well as reduce the financing to help with down payments.
But resident-owned communities are relatively new, especially in Colorado, and because of that, Peirce says, finding additional funders has been challenging. Ultimately, he attributes this to differing models addressing affordability in the region. While most municipalities are focused on new developments, affordable rentals, or deed-restricted housing for people making a certain percentage of AMI, residents in manufactured homes bought into their communities with the understanding that their home came without such restrictions. For example, Peirce says, Boulder County Housing has expressed interest in helping Sans Souci with possible funding for years, “and have consistently gotten nowhere productive.”
Any funding from the county, he continues, would come with conditions that wouldn’t necessarily work for Sans Souci residents, like deed-restricting the homes, and could even cause riffs and factions to form within the community.
“That’s the model the county is operating under, and it works in a different context but not in ours,” he says. “They really need to think about how to prevent displacement for mobile home park people without basically having to extract a pound of flesh.”
Speaking as a steering committee member for the Boulder County Regional Housing Partnership (RHP), Kurt Firnhaber, director of the City of Boulder Housing and Human Services Department, writes in an email, “With the main source of funding for housing authorities coming from Low Income Housing Tax Credits, they do not currently have resources that can be applied to manufacturing housing communities. However, the RHP has looked at other sources of funding to support such communities, as well as state level legislation that benefits and protects residents of these communities,” he says.
At the state level, Hooton is working with other legislators to address some of the funding shortfalls. She proposes a revolving low-interest loan fund for mobile home communities where the residents want to purchase their park. She says the financing could potentially come from funds earmarked for affordable housing under the new federal transportation bill, although nothing has been decided.
Democracy is messy
Although Sans Souci residents strongly supported the idea of purchasing the park at first, some grew frustrated by the increasing price tag as the numbers from ROC USA Capital came in. It felt, Peirce says, that there was still a large player dictating major expenses, and fear that in the end residents would still get saddled with a substantial cost.
“The other part that makes a lot of people squeamish about going this route is that a co-op and HOA are really close to the same thing,” Peirce says. “They’re just slightly different business models. But they’re close enough that the scare stories about HOAs affect residents. And so a lot of them would say, ‘No, I don’t want to be part of an HOA. Those are nightmares.’” (Read: (un)affordable: “Pressure Points,” Boulder Weekly, June 17, 2021).
In the end, the co-op was still able to garner enough support for the purchase to succeed, although it was not unanimous.
“We had a choice between corporate owners or the ROC USA model,” Peirce says.
“And despite the unhappiness of the price tag, even with the flood mitigation reserve, it was still financially the better option for anybody who plans to be around for more than three years.”
Thistle, Kadlec says, generally requires about 75 percent engagement from an individual community to feel comfortable assisting them with a purchase, even though the state law only requires a simple majority of 51 percent.
“When we’re looking at a community that may have a really big rent increase,” she says, “we want to see more engagement because . . . it’s something that can create a lot of animosity [or can] create unity in the community.”
Recently in Fort Collins, an effort by a resident co-op of Hickory Village Mobile Home Park to purchase its park failed. Now, the private real estate investment group Havenpark Communities—which has a history of pricing out residents—is set to purchase the park for $23 million. Initially the current owner announced the sale in March, and the residents offered $23.1 million for the park, securing support from enough homeowners. However, according to a complaint filed with the state, the seller ignored the co-op’s offer. In response, the park owner initiated a new 90-day period for the co-op to submit an offer in late June. But this time there wasn’t enough resident support.
Even if a community is ultimately successful in purchasing its park from a single owner, in the co-op model park rules and policies have to be decided—and enforced—by fellow residents, which can get tricky. At Sans Souci, Peirce says, residents are just starting to voice differing opinions about living habits like pets and cleanliness. There can also be long-held interpersonal conflicts and other frustrations, as everyone is expected to contribute to running the community. Plus, running a park takes a lot of time, effort, and skill, which can overburden the all-volunteer endeavor, Peirce says.
“Sometimes it can be a little more work,” Kadlec says. “Democracy is messy sometimes, but I think it’s one of the better ways that we can do it.”
Whether or not residents succeed in purchasing their park, there are inherent benefits to trying, Kadlec says. Residents become leaders in their own communities, learning to speak up for themselves in public meetings, advocating for assistance and preservation.
“We’re creating community and we’re bringing people together, we’re introducing neighbors to each other and making those connections,” Kadlec says. “And that’s just going to make the community stronger, whether they buy or not.”
There are a couple of different solutions strategies employed within Boulder when it comes to preserving the affordability of manufactured housing, apart from supporting resident owned communities.
Under unique circumstances, the City of Boulder bought the 18-acre Mapleton Mobile Home Park in the late 1990s using money from the Stormwater and Flood Control Utility Fund.
Later it turned it over to Thistle, which now operates the property as a land trust, leasing it out to the resident-led nonprofit Mapleton Home Association (MHA). While the residents still don’t own the land, the lot rents go into a fund that is invested directly back into the community. Additionally, 120 of the 135 homes have been deemed permanently affordable through deed restrictions.
Resident owned communities, like Sans Souci, are “a great model for regular ownership, but not more affordable housing,” says Isabel Sanchez, president of MHA. Still, with the land trust model, the benefits of resident control remain, she adds. “Any decision that’s made, the whole community votes on, so it’s very different than just having a landlord-lease condition where they would make all the decisions.
”MHA also has Thistle as a partner in larger expenses, like a $3 million infrastructure project that was funded by loans the housing nonprofit helped secure for MHA.
While the model works for Mapelton, Kadlec is a bit wary of it working elsewhere.“Mapleton is in the City of Boulder. There’s not a nonprofit that could pay for that right now,” he says. “So I think at the time it was a great opportunity to preserve it under that land trust model when we weren’t aware of the ROC model.
”Financing municipal mobile home parks can be tricky, especially with the constricted budgets of recent years. Elsewhere in Colorado, the Aspen-Pitkin County Housing Authority purchased its first manufactured housing community in the early 1980s. Since, it has added four more, the latest in 2018, which Pitkin County purchased for $6.5 million. In 2007, the Yampa Valley Housing Authority purchased the Fish Creek Mobile Home Park near Steamboat Springs and replaced its infrastructure.
And the City of Boulder purchased Ponderosa Mobile Home Park, with flood recovery funding, for $4.2 million in 2017.“That property was very much in jeopardy during the flood and has an infrastructure that would not have withstood another event like that,” Ritenour, with the City, says. Since, Boulder has annexed the property and is in the process of intense redevelopment, which includes the option for residents to convert their manufactured homes into fixed-foundation Habitat for Humanity houses. However, this transition is not a requirement for current residents of the park.“
When we have the opportunity to save a park and bring it into the city, we like to do that because we think we are good caretakers of those types of housing, or it can help facilitate good care-taking of those types of housing,” Ritenour says. Still, the City’s zoning laws—things like setbacks and density—and lack of large plots of undeveloped land, make it difficult to start a new manufactured housing community, she adds, so preservation is really the only viable option currently, from the municipal perspective.