JPMorganChase finances vulture fund’s assault on manufactured housing communities and on affordable housing

Alden Global Capital – the hedge fund infamous for slashing newsroom jobs at hundreds of U.S. newspapers it acquired – has made a dramatic incursion into the manufactured housing market via its affiliate Homes of America. Since 2021, the company has spent over $275 million buying up at least 144 manufactured home communities with more than 10,000 home sites, most of which are in Florida, Michigan, and Illinois. 

Although Alden Global Capital appears to have made cash purchases of the manufactured home parks, Alden has saddled the parks with debt after acquiring them, taking out mortgages for hundreds of millions of dollars on the parks. JPMorganChase is the largest lender to Alden, having made a $93 million mortgage in 2022 secured by more than 50 of these parks.

JPMorgan has a whole section on its website inviting the viewer to “[f]ind out how JPMorganChase is combating the US housing crisis via affordable and workforce housing loans, investments, and services.” However, the $93 million mortgage that JPMorganChase made to Alden Global is supporting a company that has increased rents dramatically at a number of its properties. 

Manufactured homes are a vital source of affordable housing at a time when there is a severe shortage of affordable homes. Manufactured homes are a particularly important housing option for families who live on fixed incomes, such as seniors and individuals who are unable to work due to disability. 

A number of news stories have reported on Alden Global’s dramatic lot rent increases after Alden took over the park, including at parks financed by JPMorganChase. The report by MHAction and the Private Equity Stakeholder Project (PESP), “Vulture Wars: Alden Global Capital’s Assault on Manufactured Home Community Residents,” includes additional stories about large rent hikes at the Chase-financed parks. 

• Residents at the senior living community Lakeside Village Mobile Home Park in Deland, Florida reported in August 2022 that they were notified that their rent would be increasing from $360 to $550, an increase of 52%. Many of the residents’ only source of income was $600 to $900 a month in social security, and many did not have to the option to move. “My problem with leaving here is my motor home is a 1998. You can’t take it anywhere,” said one resident. “If it’s over ten years old, they won’t let you put it anywhere.”
• Alden also raised rents at the Six-O-Five Mobile Home Park in Virginia in 2022. One 77-year-old resident on social security reported that her lot rent jumped 40% from $445 to $625 a month.
• Diane Hull, a resident of Baltimore Terrace in Michigan, said that she has owned her home for 15 years. When Homes of America bought the park, they tried to raise the lot rent by $200. She said that she was in the middle of a year’s lease, so she went to Legal Aid and they wrote a letter to Homes of America telling them they couldn’t raise the rent. Hull said that Homes of America also tried to raise her neighbors’ rent, so she went around and told her neighbors that Homes of America couldn’t do this if they already had a lease. 

Our report, Vulture Wars, documented Alden Global’s aggressive eviction practices at a number of its parks, including at five parks in Florida that were financed by JPMorganChase. Lake Bradford Estates, financed by JPMorganChase, had the most eviction filings of these parks with 59 eviction filings in a park with just 300 units. The other four parks financed by JPMorganChase that were included in the report (Cocoa Point, Cypress Strand, Forest Green, and Lake Runnymeade) have a total of 325 homes and had a total of 65 eviction filings, for an average eviction rate of 20%. The eviction filing rate compares the number of eviction cases initiated (civil new filings) to the number of mobile home units on the properties.

Section 3.4 of the mortgage made by JPMorganChase states that “Borrower [Homes of America] shall cause the Property to be maintained in a good and safe condition and repair.”  There are a number of examples of Homes of America’s persistent neglect of habitability issues. 

For their report, Home Sick: Uncovering the health harms in Homes of America’s manufactured home communities, Health In Partnership (HIP) and MHAction conducted in-depth interviews with 20 residents of Homes of America communities and examined housing code inspection reports for 10 communities. HIP and MHAction found widespread issues with:

• Poor drinking water quality
• Water shutoffs
• Water and sewage infrastructure failures
• Vacant homes and debris
• Broken and barricaded roads
• Overgrown trees and brush
• Neglected community amenities

According to the HIP report, regulatory agencies documented violations of water quality standards in at least four Homes of America parks that were financed by JPMorganChase. This included Baltimore Terrace in Michigan, where the state Department of Environment, Great Lakes, and Energy recommended that the park not be re-licensed due to the “condition and lack of compliance of their water system.”  [p.15] 

Code inspectors condemned vacant units and issued violations to Homes of America in several communities, including at North Morris Estates in Michigan, where code enforcement personnel identified 25 lots that required demolition and over 20 that had specific issues, such as with porches, roofs, and windows. [p. 26] North Morris Estates is one of the properties covered by the JPMorganChase mortgage. 

Residents who rented their home from Homes of America experienced habitability issues, according to the report. Code inspection records for Lake Bradford Estates in Florida list violations for electrical wiring, sewage backup, leaks, and infrastructure units in at least three units. [p. 35]

If JPMorganChase is committed to affordable housing, it should immediately look into how Alden Global and Homes of America have been using the $93 million that Chase lent them and what the impact has been on the residents of the more than 50 manufactured home parks that the mortgage is secured by.  JPMorganChase should also inspect these parks that serve as collateral for the mortgage and determine if they are in compliance with Section, which requires that the properties “be maintained in a good and safe condition and repair.”