:: ROP COMMUNITIES
Niles East Mobile Estates
8500 Kern Canyon Road
Bakersfield, California 93306 Other ROP Communities
Niles East is a 139 space mobilehome park developed in 1965. The park had been under the same ownership for 30 years, and the park owners had no interest in selling the park and had not listed the park for sale. In July 2002, the Niles East Homeowners Association contacted ROP to learn more about how ROP, as a nonprofit housing corporation, might be able to purchase the park for the benefit of homeowners. With authorization from the homeowners association, ROP contacted the park owner to determine if the owner would be willing to sell to ROP for the benefit of park residents. Park ownership agreed to a meeting at their offices in Orange County, and within two weeks, ROP representatives met face to face with park ownership regarding a possible purchase.
Encouraged by the park owners’ willingness to consider a sale for the benefit of the residents, and after determining the range within which the park owners might be willing to sell, ROP attended it first noticed meeting with homeowners to explain ROP’s approach to a park purchase, and to update residents on ROP’s meeting with the park ownership. A question and answer period was part of this presentation so that homeowners could ask specific questions of ROP.
Shortly after the first meeting with residents, ROP pursued further communications with park ownership, and determined the specific price at which the park owners would be willing to sell. ROP then went to work with its financial team to determine the cost of available financing for a purchase at that price, as well as a detailed study of what monthly costs would be required to operate and maintain the park in good working order and condition following purchase. The operation and maintenance calculations included regular monthly deposits to a reserve account to meet emergency repair or replacement expenses. After considerable research and preparation, ROP was ready to meet with residents at a second noticed meeting. Using an overhead projector, ROP presented specific numbers on what space rents at Niles East would need to be following close of escrow, if ROP proceeded with a purchase at the park owners’ price.
The projected space rent following a park purchase was not a low-ball number based upon low interest loans or grants that might not happen, but was a realistic projection based upon current interest rates and financing that was available to ROP as a nonprofit housing corporation. Based upon the specific information presented by ROP, and following a lengthy question and answer period, homeowners in attendance passed a motion to support ROP’s acquisition of Niles East. Within six weeks of its first contact from homeowners, ROP entered into contract with park ownership for the purchase of Niles East.
ROP worked closely with the Niles East Homeowners Association to gain the active participation and support of park residents as ROP pursued state and local low-interest loan and grant programs that would enable ROP to achieve a park purchase with even lower monthly rents than the projections initially presented to the homeowners. With the active assistance of the homeowners association, ROP explained that many state and local loan programs required that two-thirds of the residents support the park acquisition by ROP as a condition of applying for low-interest loans and grants. Such programs also required that residents be willing to provide specific documentation of their monthly income to determine what percentage of park residents met the lower income guidelines for their county of residence.
ROP protected the confidentiality of financial information provided by Niles East homeowners, by providing ROP staff at the park to meet individually with park residents when they discussed and provided documentation of their household income. Such financial information remains confidential and was used by ROP only to document the low income status of park residents to loan officers for the state and local programs. With information provided by Niles East homeowners, ROP pursued funding from the State Department of Housing and Community Development’s Mobilehome Park Resident Ownership Program (MPROP) and from Kern County. ROP’s application from MPROP was approved and the state program administered by HCD provided nearly 60% of the purchase price for a term of 30 years at only 3% simple interest. The approval of funding from MPROP enabled ROP to dramatically reduce its space rent projections, and to preserve affordable rents at Niles East.
During the due diligence phase of the park purchase, ROP advanced the costs of an MAI certified appraisal of the park, and inspections and reports from licensed contractors and engineers who determined the condition of the park sewage system, electrical system, gas distribution system, clubhouse roof and HVAC system, common area streets, and an environmental assessment of all park property. ROP took all necessary steps to secure the remaining financing for the park purchase, while maintaining communication with both the park owner as well as park residents.
ROP enlisted the help of the board of the homeowners association in reviewing and critiquing the existing park rules and regulations, and formulating the changes which they believed should be made to the park rules for the benefit of park residents. Even before the escrow closed for purchase of the park, changes favored by park residents had been submitted to ROP for consideration and for action following close of escrow. ROP also welcomed suggestions from the homeowners on restoring the use of certain bulletin boards in the clubhouse for the use of the homeowners association and the park GSMOL Chapter, and for extending park office hours so that residents could more easily communicate with park managers following the close of escrow.
From ROP’s first meeting with Niles East residents, ROP made it clear that it was committed to working with homeowners to improve the park and that the elected homeowners association board would serve as the Advisory Board to ROP concerning proper management and operation of the park. ROP meets with the homeowners’ board on a quarterly basis in the park clubhouse, and annually with all park residents at their noticed Annual meeting. Financial information on park income and expenses is shared with board members at the quarterly meetings, and at annual meetings all homeowners are given a written financial statement which itemizes all park income and expenses for the year. Homeowners know exactly how much rental income has been received, how much has been paid on the debt service for purchase of the park, what has been spent on park operation and maintenance, and how much has been deposited into the reserve account for emergency repair and replacement expenses.
ROP hired and trained experienced, full-time resident managers for the park, as well as a resident assistant manager. As a nonprofit housing corporation committed to own and operate the park for the benefit of residents, ROP’s policy and practice at every level of the organization, is to treat residents with respect, and as co-owners of the park. After all, it is the rent payments of park residents that is reducing the debt service for purchase of the park, and paying for all operation and maintenance expenses. In an ROP park, there is no friction or conflict between park management and homeowners. Management is not there to maximize profits for a “for profit” park owner. There is no “for profit” park owner, only nonprofit ROP whose sole purpose is to properly and prudently manage the park for the benefit of park residents, and to involve them in the process of park management. The experience and knowledge homeowners gain from working with ROP will prepare them to assume ownership and management responsibilities for a debt-free mobilehome park when park rents have paid off the purchase loan for the park.
ROP closed escrow and became legal owner of Niles East within 11 months of entering into the formal purchase contract with the park owner. Within 24 hours of the close of escrow, ROP was at Niles East holding its first quarterly meeting with the elected board of the homeowners association. Two days following close of escrow, ROP hosted a celebration with homeowners in the clubhouse, complete with a catered barbeque dinner and recognition of the many homeowners who worked diligently during the acquisition process. Within one week following ROP’s purchase of Niles East, the park hosted a Bakersfield area meeting for local chapters of Golden State Manufactured Home Owners League, Inc., (GSMOL). Over 150 GSMOL members were in attendance, and the featured guest speaker was GSMOL State President Steve Gullage.
As part of its management function at Niles East, ROP will purchase annual GSMOL memberships for all park residents. ROP will assume annual payment for those residents who were not previously GSMOL members, and assume payment for existing GSMOL members upon renewal of their memberships. The GSMOL Chapter at Niles East will have 100% membership in GSMOL, providing financial support for the statewide association, and providing a strong base of local advocacy to protect mobilehome owner rights in the Bakersfield area.
Using the ROP method of purchase at Niles East, no homeowner had to come out of pocket for a down-payment, nor did they have to individually qualify for personal loans. Homeowners will continue to pay space rents that remain affordable, and all of those rental payments will be used to pay off the purchase loans for the park and to pay for the park operating and maintenance expenses. Unlike privately owned rental parks where homeowners pay rent for years and years and never own the park, homeowners at Niles East are credited for paying the debt service for the park, and ownership and management of a debt-free mobilehome park will be transferred by ROP to the nonprofit homeowners association when the loans for purchase of the park have been repaid in full. During the 30 year ownership and management by ROP, homeowners will benefit from stabilized and affordable rents whether local mobilehome rent control exists or not. ROP does not control or restrict the price that a homeowner can ask upon resale of his home, and home values benefit from the stabilized and affordable space rents.
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More than 125 park residents celebrated ROP's purchase of Niles East at a catered Barbeque dinner in the clubhouse on October 12, 2003." |
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"I have served on the Homeowners Association Board of Directors for 13 years and during that time often spoke with residents about the possibility of purchasing the park someday. In 2002, at the request of the Board, I contacted Maurice Priest, President of ROP, to find out if it was feasible to do a park purchase. ROP handled everything that was needed to purchase the park. Without Maurice Priest and his staff at ROP, none of this would have been possible. We, the residents, sincerely thank them."
--Joe Bond, with wife, Helen
Homeowner and Board Member |
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Opal and Roger Hargis are active homeowners at Niles East. During ROP's acquisition of Niles East, Roger has served as President of the Homeowners Association, and the primary resident contact for ROP."Maurice Priest and the ROP staff completely exceeded our expectations in all areas---honest, complete communication, absolute follow-through, dedication to detail, thorough understanding of Mobile Park regulations, professional understanding of the money (loan) markets and, finally, a fierce dedication to do the right thing for the Senior Residents of this Park. We would recommend ROP to anyone, without reservation".
--Roger and Opal Hargis
Niles East--Bakersfield, Ca. |
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Homes at Niles East show pride of ownership. ROP's commitment to maintain all park common areas to a high standard helps to protect and promote home values at Niles East. |
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Niles East greenbelt areas are professionally maintained by a landscaping service.
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Niles East Billiard Room. |
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The Niles East Clubhouse, at 8500 Kern Canyon Road in Bakersfield, is the community centerpiece for resident potluck dinners, GSMOL Chapter and Regional Meetings, and Friday morning donuts and coffee hosted by park management every week. The clubhouse features a full-size commercial kitchen, state of the art public address system, billiard room, reading area, color TV, fireplace, and the park office. |
