National company looks to acquire Route 54 mobile-home park
Private property owners generally have the right to sell their land. But what happens when hundreds of homes are located there?
After half a century, the Gray family is looking to sell the Shady Park mobile home park, just west of Fenwick Island. They own the ground, which is rented to the actual residents, who only own the structures they live in, including mobile homes.
Although other prospective buyers have suggested purchasing the 60-acre property, a Michigan-based company actually made the Grays an unsolicited offer to buy it.
The sale is not final yet. Although RHP Properties made a bid, they are currently in the due-diligence phase of the purchase. Joshua Mermell, RHP senior vice president of acquisitions, met with residents on May 1 to discuss the expected transition.
“We’re selling the park. It’s been owned by our family for almost 50 years. Dad pretty much built it. My mom and dad started it in 1970,” said Ron Gray, who designed an expansion to the park as a junior engineering student.
After his father passed away, Gray returned in 1990 to help his mother, and they planned another expansion. Then, nearly three years ago, she passed away.
Now, he and his two sisters own and run Shady Park Inc. (as well as two carwashes and a self-storage facility).
“We decided as a family to sell it. It’s sad. It’s almost like a lot of people in there are family,” Gray said. “We’re selling it to a company that all they do is mobile-home parks.”
Headquartered in Farmington Hills, Mich., RHP Properties oversees 235 manufactured-home communities nationwide. It’s the third-largest owner and operator of manufactured-home communities in the United States, with more than 60,000 individual sites or houses in 24 states. It is the largest privately-owned company of the bunch.
Last summer, they acquired their first Delaware property, in Wilmington. Their website says the company is “aggressively expanding.”
“RHP Properties is always looking for opportunities to purchase manufactured-home communities with the goal of providing outstanding service and value to residents,” Mermell told the Coastal Point.
“RHP Properties has been operating manufactured-home communities since 1988, and owns and operates two other communities in Delaware,” according to Mermell.
He said RHP has purchased other family-run communities and that residents can benefit from having local managers, as well as the company’s 30 years of management experience.
Regarding rumors of a planned rent increase, the company suggested, “It is premature to talk about rent. Decisions about rent will be done in accordance with Delaware Rent Justification Regulations, and residents will receive proper notification.”
When residents were first notified of the likely sale in late April, they feared the property could be flipped and sold to a developer in the future.
“We look forward to owning Shady Park for a very long time, similar to our other communities,” Mermell responded. “We have already begun meeting the residents and look forward to becoming an active member in the Selbyville community.”
“It should just continue like it had been. It’s going to be under different management. … The intent is to keep it like it is. People can keep their home,” Gray said. “They told us they’re going to operate it as a manufactured-housing park, and we hope that’s how it stays for a long, long time.”
People living in mobile-home parks have support through the Delaware Manufactured Home Relocation Authority.
“The intent is not to close the property or close the park,” confirmed DMHRA Executive Director Gregory Sutton.
All Sutton has received regarding the sale is an “Intent to Bid,” which means the property is being sold. There have been no requests to change the mobile-home park into something else.
Hypothetically, if a landlord chose to sell the land for a different use or terminate a resident’s rental agreement, the landlord would have to jump through many hoops. The company would have to give a year’s notice and submit a plan, updated regularly, to the State and the affected tenants. The State would also provide some assistance to people with relocating to a nearby community.
People can learn more about the agency at https://demhra.delaware.gov and about the Manufactured Home Owners & Community Owners Act at http://delcode.delaware.gov/title25/c070/sc01/index.shtml.
When a management company owns the land, it is responsible for trash collection, street maintenance and other upkeep of common areas.
“The level of existing services in the community will remain the same. … We look forward to maintaining and exceeding the high level of service residents have enjoyed for years,” Mermell said. “RHP Properties is excited about the opportunity to own Shady Park and continue the legacy that the family has created over their years of ownership.”
Just as the Grays own the site as Shady Park Inc., the company will create a new legal entity for ownership.
While the Swann Keys community is located just behind Shady Park, it is expected to be generally unaffected by the proposed sale. That is a more traditional neighborhood, in which homes and lots are individually owned.
By Laura Walter