Residents of Gorham mobile home park could be the latest to buy their community
Apr. 20—GORHAM — It was standing room only Sunday afternoon in the Friendly Village mobile home park's small clubhouse.
Roughly 100 residents packed into the warm room, with others standing just outside the door or joining remotely, a hum of nervous chatter filling the space.
They were all there because of the notice — a letter from an attorney representing the Gallagher and Baldwin families, the longtime owners of the 302-lot Gorham park.
"The owners have decided to sell their holdings in all states as a portfolio which includes Friendly Village manufactured housing community in which you reside," the attorney said in the flyer that appeared in each resident's mailbox.
The New Hampshire-based families had entered into a four-state, eight-park, $87.5 million purchase and sale agreement with Wyoming investment firm Crown Communities LLC.
Mark Tay, the attorney for the Baldwins and Gallaghers, declined to discuss the sale while there is a pending transaction. Crown Communities did not respond to an email seeking to discuss the offer.
It's the latest purchase offer in what's becoming a familiar trend in Maine and across the country.
Longtime mom-and-pop park owners decide it's time to sell the business and an out-of-state investor swoops in, often with a multi-million-dollar cash offer.
The new owners raise the monthly lot rents and collect the profits, frequently without making necessary infrastructure improvements or improving services. Residents who own their homes but not the land beneath them are often stuck.
"Mobile" is a misnomer. It's difficult and expensive to move their homes. They could sell, but where would they go? The parks are considered the last "naturally occurring" or unsubsidized affordable housing.
It's estimated that more than one-fifth of Maine's 468 licensed parks are now owned by out-of-state investors.
Friendly Village could join those ranks, but residents are mulling their options. In the last year, several communities have opted to form cooperatives to purchase their parks.
A law passed in 2023 gives residents the "opportunity to purchase," meaning that if a park owner receives an offer, residents have 60 days to pull together a matching bid and the owner must negotiate in "good faith."
So far, residents in Brunswick, Bangor and Monmouth have succeeded in buying their parks, but more than twice as many have failed, even with offers just above the competition.
Sunday, residents met with the Cooperative Development Institute, an organization that assists manufactured housing communities looking to purchase their parks and provides ongoing support after the purchase.
Nora Gosselin, director of resident acquisitions, told residents they weren't there to sign on the dotted line — it was simply an introductory meeting to see if they might be interested in trying to purchase.
THE CLOCK IS TICKING
The Friendly Village sale could be the first multi-state offer to test the law, but it's unclear whether the sellers would be willing to break up the portfolio.
However, they could be forced to — both Massachusetts and Rhode Island, where four of the eight parks are located, have "right of first refusal" laws. The concept is similar to Maine's opportunity to purchase statute, but supporters say it has more teeth.
If the residents want to buy the park and can match the competing offer, the seller has to comply. Maine legislators are considering a handful of mobile home-related bills, including one that would give residents the right of first refusal, as well as one to block hefty rent increases in parks where residents either decide not to buy or have their offers rejected.
The clock for the Gorham Park started ticking April 3 and the price tag for just Friendly Village is $22 million.
"The incoming buyers are not a family," Gosselin said. "... They're not in town, they don't need to go to the grocery store with you, they don't need to look you in the eye. They can just basically see this as something to make some money and to keep your park going before they sell it."
But she cautioned residents not to base their decision on fear of the alternative.
"You're all going through this together, and at the end of the day, only you can make this decision with each other," she said.
Joe McHugh, 79, and his wife, Cathy McHugh, 74, moved to Friendly Village three years ago. Originally from Cape Elizabeth, the couple moved after a series of medical bills wiped out their finances.
Until recently, they've felt the move was a great choice. But now the McHughs worry about their future.
"I'm very leery of being priced out," McHugh said. "And where would we go? Being retired, we have our backs against the wall."
"It's very scary," Cathy McHugh said of the impending sale. "We bought this place because it was affordable."
At the meeting, Joe McHugh told residents that Friendly Village would become a "profit center" for the investment company.
"You're not going to find anybody that gives a damn," he said. "So long as we can afford it ... I think we should be all in."
'NO QUESTION IN MY MIND'
If the residents decide not to proceed or are unsuccessful, the park would be Crown's first in Maine. The company, which is rebranding as Ignite Communities, currently has 15 parks in its portfolio, with just one New England park in Cheshire, Massachusetts.
Crown entered into a $3.8 million purchase and sale agreement with The Park at Pocasset, a Cape Cod manufactured housing community, in 2019. But since Massachusetts has right of first refusal, residents voted to buy the park.
However, Crown challenged the community petition to buy, arguing that the co-op did not have valid signatures from the required 51% of the park's residents, kicking off a more than five-year legal battle. A judge ruled last week in favor of the residents and Crown has 30 days to appeal the decision.
Dawn Beaulieu, 61, and Carol Cook, 58, who organized the meeting, canvassed the community, passing out fliers, urging residents to "organize and preserve your rights." They're worried about Crown's reputation — both because of the Cape Cod case and from stories about poor conditions and rent increases at other parks.
Beaulieu has lived in Friendly Village for almost 30 years. Cook has been there for a more modest five years, but neither is looking to move.
"I think if we let it go into the hands of this potential buyer, we could see massive rent increases to force us out of our homes," Beaulieu said. "That seems to be what we're hearing most from residents who talk to us. They're all worried about getting to a point where they just can't afford to live here anymore and they don't have anywhere to go."
After the meeting, the pair was optimistic that the community would choose to move forward with purchasing the park.
Beaulieu believes it's the right call.
"There is no question in my mind," she said.
RIGHT OF FIRST REFUSAL
Gosselin, who is meeting with the Massachusetts and Rhode Island parks in the coming week, thinks Friendly Village has a reasonable shot. But it's never a sure thing.
"It is a painful element of this law, with these really motivated, some might say aggressive, purchasers in the wings," she said.
Gosselin noted that the difference between a right of first refusal and an opportunity to purchase may seem like splitting hairs, "but in this market right now, it's a world of a difference," she said.
Maine could be on the cusp of adopting its own law.
Proposed by Sen. Tim Nangle, D-Windham, the bill would give residents the "right of first refusal" to purchase their park when it goes up for sale.
The bill is scheduled for a work session Tuesday and includes an emergency preamble, meaning it would go into effect immediately "so we can attempt to give Friendly Village the opportunity to have some self-determination," Nangle said.
Nangle is "cautiously optimistic" that the bill will have the support it needs. With hundreds of mobile home parks across the state, there's one in most, if not all legislative districts, he said.
"That's our job here, to protect Maine people," he said, and with several parks "in jeopardy," he believes that's what his legislation does.
Nangle is familiar with the right of first refusal. His family owned a mobile home park in Massachusetts and sold it to residents in 2021.
"The seller shouldn't care where the money is coming from," he said. "Who cares if they're getting $87 million from the residents or $87 million from an out-of-state developer?"
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