Orange Mobile Home Park Tenants Face Steep Rent Hikes

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This article originally appeared in the June 27 edition of the Montague Reporter.

The owners of Leisure Woods Estates are petitioning the town for permission to significantly increase their monthly lot fees for the second year in a row, while many residents of the mobile home park worry that they could be priced out of the community. 

On June 11 the Orange Mobile Home Park Rent Control Board held a public hearing to listen to the owners’ justifications for a proposed 43% rent hike, and to hear residents’ perspectives. About 50 people attended the hearing in the Orange town hall auditorium, with many sharing concerns about the park’s affordability and its overall condition.

“I used to live in Wendell, and I was taxed out of my home in Wendell,” said Barbara Sylvester, who moved to Leisure Woods in 2022. “Another reason I chose to move into Orange is because you are rent-controlled, and it’s getting crazy in Greenfield and Turners, [which] don’t have that protection for us.”

When Sylvester moved to the park, the rent for each lot was $359 per month, which she said was affordable as someone living with a disability and working at Stop & Shop part-time. Months later, the rent control board approved an increase to $410, and Leisure Woods management is now seeking to raise it to $588. 

“I haven’t even lived there two years, and if you take $588 out of my income that leaves me with nothing to survive on,” Sylvester said. “I would be forced to sell.”

The 146-unit manufactured home community, located between the Orange municipal airport and the Millers River, is home to many elderly, disabled, and low-income people. 

“I have worked with many, many, many people in Leisure Woods who struggle now,” Orange Council on Aging director Tracy Gaudet said at the hearing. “There’s going to be a lot of homeless people with no housing to go to…. I just can’t imagine where the money is going to come from, or how these people are going to survive.”

Gaudet said the average monthly income for her clients is around $1,500, and that increasing the lot rent by the proposed amount would be untenable for many of them, especially those still paying for their mobile homes. 

“Some of them do have mortgages,” she said, “and some of them will just walk away from that investment – and that is terrible.”

Alfred Henderson testified that the proposed hike far exceeds the latest increase to his Social Security check, and would leave him about $100 short every month after he pays for food, medications, and doctor’s visits. The 91-year-old widower said that if the increase is approved in full, he plans to pay the amount into an escrow account until the matter is settled in court. 

“I’m not against a rent increase as long as it’s fair and reasonable, but $178 is way out of sight,” Henderson said. “I realize that you have expenses, and so do we. I realize your expenses are going up, but so are ours.”

A Fair Number 

It is up to the three-member Orange Mobile Home Rent Control Board, established by a town bylaw in 1985, to determine whether Leisure Woods Estates, Inc. may increase its lot rental rate, and by how much. 

“We are striving to arrive at a point where Leisure Woods makes a reasonable profit on their operation at 519 East River Street,” board chair Jane Peirce said at the hearing, “but we are also needing to be mindful of the population that lives there.”

Peirce, a member of the Orange selectboard and board of health, was appointed chair at the beginning of the meeting after a motion was made to organize the board. She thanked her fellow selectboard members Andrew Smith and Julie Davis for agreeing to join her.

“[I] apologize for how long it has taken us to assemble this meeting,” Peirce said. “It seems like nobody wants to be on the rent control board.”

The regulations empower the control board to set a maximum lot rent that takes into account the tenants’ interests while allowing the owner to earn a “fair net operating income” after deducting mortgage payments and “reasonable” operating expenses. The board also reserves the right to deny a requested increase if it sees evidence that the owner has failed to provide “normal and adequate repairs and maintenance.”

“It’s not like we can just decide what sounds reasonable and what doesn’t – it’s an exact formula,” Peirce told the Reporter. “There’s a very, very closely prescribed process that we will follow to try to arrive at a fair number for everybody.” 

Leisure Woods president and director Glenn Gidley testified that the park has been running a deficit for the last decade, during which time there were no increases in lot rent. 

“We went 10 years trying to be sensitive to the fact that we were in some down economic times,” Gidley said. “We were planning some rent increases, then the pandemic hit – and I even talked to the chair of this board and it was told to me that maybe we should wait. We waited, and here we are. We are operating at a deficit.”

A current-year budget submitted by Leisure Woods as a requirement of its petition estimates annual rental revenue from the park at $697,997, leaving the business with a net loss of $29,153 after anticipated expenses, which include $170,000 in payroll for four employees, $130,000 for water and sewer bills, and $105,650 for maintenance, as well as $50,000 for a line labeled simply “Miscellaneous.” 

Factoring in $45,000 in interest payments and $500 in state income tax, the company said it faced a net loss of $74,653. 

John Kuzinevich, a lawyer representing the company in the proceedings, told the Reporter that a portion of a $30,000 “professional fee” line item covers his services. He noted that the company’s financial statements had not been independently audited. “We don’t need to go through the expense,” he said. 

Kuzinevich also told the Reporter that over the last decade, Leisure Woods has actually netted an average gain of about $16,000 per year. “The Gidleys view it as a loss,” he said, “but from an accounting perspective it’s not a real loss, it’s a break-even.”

The town’s rent control bylaw indicates that an owner’s “fair” income can be calculated using the property’s market value and prevailing commercial interest rates. Considering Leisure Woods’ $3.4 million tax assessment and assuming an 8.25% interest rate, the company asserts that its fair income should be $281,861.

“That’s basically what they should be earning, considering the value of the land and their own services,” Kuzinevich told the Reporter. “No prudent investor would invest $3 million and be satisfied earning $16,000.”

“We’re just looking for a fair rate of return,” he said. “While we really do sympathize – it’s tight times for the residents – it’s the same for my clients.” 

Constant Sniping

During the hearing, residents complained that Leisure Woods lacks amenities offered at other mobile home parks, including those used in financial comparisons to justify its requested increase. Several shared concerns about inadequate stormwater drainage, icy roads in the winter, and long delays before maintenance requests are acted on. 

Other residents told the board that the community recreational room is in severe disrepair and remains shuttered, having never opened.

“The constant sniping and abuse that we put up with, and our staff puts up with, is ridiculous,” Gidley said, responding to the complaints. “‘And then we want clubhouses! And then we want cookouts! And then we want parties!’ The acrimony has to stop. There is a certain faction of residents at Leisure Woods that will come up here and tell you anything, whether it’s fiction or not, to make us look bad so that these fees don’t go up.”

Gidley is also the owner of Salem Manufactured Homes, a New Hampshire-based company that describes itself on its website as a “thriving, vertically integrated family business with over 15 employees.” Salem both sells manufactured homes and manages seven mobile home parks, according to a list on the website, including Leisure Woods. 

When fuel expenses at the Orange park ran high in recent years, Kuzinevich told the Reporter, Leisure Woods took a loan from Salem Manufactured Homes. 

“Salem Manufactured Homes and Leisure Woods Estates are totally separate and distinct corporations,” he clarified. “They do not share a common set of books. If there are transactions between them that are reflected on the books, just like any transaction with any third party, there is no commingling of assets and nothing is done off the books.”

Coming to a Head

Gidley’s company has owned Leisure Woods since 1997, and in that time residents have brought two lawsuits forcing the company to fix drainage and road issues, winning both.

Arthur Hicks, a retired firefighter and 28-year resident of Leisure Woods who was involved in the lawsuits, says he believes the pressure of a nationwide housing crisis is reaching mobile home communities like his. 

“It’s going to come to a head, and everything is going to collapse,” he told the Reporter. 

One home at Leisure Woods, built in 2003 with two bedrooms and 1,300 square feet of living space, is currently listed for sale at $192,800. Alfred Henderson said another house near his sold the same day it was listed. 

At the June 11 hearing, Hicks brought attention to the park’s recreational hall, which he said was never completed, is used for storage, and is at risk of collapsing.

“They call it the rec hall – we call it the wrecked hall,” he said to applause from the audience. “At this point it’s structurally unsound, it’s on the verge of collapsing.”

Gidley said Leisure Woods would not make capital investments at the park until its rental revenue increases.

“We have struggled with it for a long time,” he told the board. “And it’s time that we get the type of fee that we can – perhaps at some point, when we get to a median level – provide some of the things these folks are asking [for]. But right now we’re down to the basic necessities, which is providing a safe, clean, park.”

“Back in the day, mobile homes were an affordable place to live – it was cheap,” said resident Sue Boyer. “It’s not cheap anymore. The new trailers – single-wides are $100,000, double-wides are $250,000. Who can afford that? And then to have lot rent on top of that, I just don’t get it.”

At the end of the meeting Kuzinevich requested the public hearing be formally closed, eliciting boos from the crowd. The board voted instead to continue the hearing, but adjourn the meeting. 

“I would like to make sure that our entire process is open and transparent,” Peirce said, “so we can explain our findings and our decision in a public meeting format.”

The board has scheduled the continuation of the hearing for Tuesday, July 16 at 6 p.m. in the Orange town hall auditorium.

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Sarah Robertson is an independent journalist living in western Mass.

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