Trailer Parks Shut Down as Property Values Go Up : Tenants Worry About Keeping a Roof Over Their Heads When Land Beneath Their Feet Goes to the Highest Bidder

In Torrance, about 40 residents at the Terrace View Trailer Park are being evicted to make way for a condominium project.

Nearly 60 residents are being chased from Maury’s Trailer Park in Hawthorne, where a shopping center is going up.

In Lomita, some 100 residents of Palos Verdes Mobile Home Park face an uncertain future. In October, 1985, they were given a year to move out, but a developer’s hotel plans fell through. Now the commercially zoned property is on the market again and is expected to be sold to another developer.

In these and other parts of the South Bay, as in other urban areas where open land is scarce and prices are escalating rapidly, mobile-home parks--especially smaller, older ones--are being squeezed out, often with devastating impacts on the largely elderly and modest-income people who live in them.

Seven Expected to Close

Ten parks have closed since 1975, reducing the number in the South Bay to 126. Another seven are expected to close within the next two years, according to city officials and developers. About 90% of the South Bay’s mobile-home parks have less than 100 spaces and appear to be attractive candidates for redevelopment because they are less profitable than larger parks.

At the same time, no new parks are expected to be built in the South Bay, developers and city officials say.

Some cities have taken steps to help mobile-home dwellers. Gardena, for example, helped residents buy the Village Mobile Home Park when a developer sought to replace it with a medical center. Other cities have eased the pain of relocation by requiring developers to give cash payments to tenants, although tenants have complained that the aid is far short of what they need to find a new home.

The state has also stepped in with several measures, including a fund to provide low-interest loans to tenants interested in purchasing a park, although the 2-year-old fund has not been used in the South Bay.

Actions Backfired

But in some cases, government actions aimed at helping mobile-home owners--rent control, for example--have hastened the demise of mobile-home parks by encouraging the owners to sell or close them. In a 1986 report, the state Department of Housing and Community Development came out against rent control, saying it “substantially” prevents a fair return on a park owner’s investment.

In any case, observers say, no amount of legislation can change the economics of the situation: Mobile-home residents own their homes but rent the land, and in the South Bay the value of the land has become too high for many of them to afford.

“If the value of the land per square foot is more . . . than the income generated by rent . . . it is likely the land use will change to a higher and better use,” said Hugh Terrell, a mobile-home park specialist for Grubb & Ellis Co., a national commercial real estate firm.

Some local governments, meanwhile, are glad to see the mobile homes go. They consider them eyesores or even health hazards, and say the land, used in other ways, could produce additional revenue for the city.

Not Low-Priced Housing

If there is a future for mobile homes in the South Bay, it appears to be at the large, luxurious parks in inland areas such as Carson where land is less expensive. But the double- and triple-wide homes there sell for as much as $100,000 and are not the low-priced housing alternative that mobile homes have long provided.

For mobile-home owners who can’t afford that option or standard housing, there appears to be only one choice: Leave the South Bay.

“There ain’t no place to go,” said Claude Bennett, 71, a 13-year resident of the soon-to-close Amberlight Mobile Home Park in Hawthorne. To find a new space for his 18-year-old mobile home, “I would have to go out way past Riverside. Even if I could find a place, my coach wouldn’t stand the strain.”

Provided Cheap Housing on the Outskirts of Towns

When mobile-home--or trailer--parks first starting appearing in significant numbers in Southern California shortly after World War II, they were considered the highest and best use of the land, according to a 1986 report by the state Department of Housing and Community Development. Land was cheaper. There were still farms and ranches between cities instead of today’s urban sprawl. Inexpensive, factory-manufactured homes plopped on a town’s outskirts provided park owners with good incomes while allowing low-income households the tax and equity-building benefits of home ownership at monthly payments near or below the price of rental housing.

Mobile-home sales in California reached a peak between 1971 and 1973, exceeding 30,000 units, according to state housing statistics. But in the next seven years, sales dropped to between 23,700 and 18,000 as the value of land increased and the growth of new mobile-home parks slowed.

By 1980, annual sales had dropped to 14,000, and in the following five years--the most recent figures available--sales did not exceed 13,500 a year. At the same time, almost no new mobile-home parks were being built. Only 3% of all parks statewide have opened since 1980, state housing officials say--and most parks constructed in the last 10 years are luxury parks that do not allow coaches more than 5 years old or homes smaller than “double-wides.”

The trend to luxury parks parallels a movement toward larger, more expensive--and less mobile--mobile homes.

Many Include Fireplaces

A modern-day manufactured home--the industry’s preferred term--arrives on a flat-bed truck with 1,800 square feet of living space or more and includes such features as fireplaces, laundry rooms, garages and outdoor decks. Some homes sit in 500-space parks with swimming pools, tennis courts, recreation rooms and putting greens.

Dominguez Hills Estates, a 7-year-old, 511-space park on a hilltop in unincorporated Rancho Dominguez near Carson, even has its own gas station and grocery store. The park is dotted with double-wide and triple-wide coaches, most with two-car garages. Monthly lot rents are between $396 and $551--depending on views--and the average home is worth about $70,000.

But Dominguez Hills Estates has no vacant spaces for rent. Even if it did, only new homes--with a minimum double-wide width--are permitted. Few parks, in the South Bay or elsewhere in Los Angeles County, allow coaches more than 5 years old, real-estate specialists say, and parks that do allow older coaches are more than 50 miles away from Los Angeles.

That leaves mobile-home owners at old, soon-to-close park’s, such as Maury’s, without many options.

Being Forced Out

“I thought I had a future here,” said Michele Alvarez, 34, a single parent who is is being forced out of Maury’s after only three years. “It’s hard to believe that I finally have my little something and now they are trying to take that away from me.”

In a sense, mobile-home owners are a hybrid between homeowners and renters. They generally rent their lots, but unlike other displaced tenants, they cannot just pick up and move because they often have tens of thousands of dollars invested in their homes.

Selling the home is usually not a good option because older mobile homes lose most of their value if they are not already in a stable park, tenants and park owners say.

Many mobile-home owners cannot afford to live in apartments. Many longtime owners have paid off their mortgages.

Demand for Land Pushes Mobile-Home Parks Out

The major reason for the closing of mobile-home parks is money. What was once cheap, undesirable land is now prime property.

“It’s a matter of economics. It’s the nature of real estate,” said Terrell of Grubb & Ellis. “This is still the United States of America, and one of the great things about our country is that you have the freedom to maximize the use of your land, as long as it is done in a lawful manner.”

Mobile-home parks in the South Bay--an area almost completely built up, where developers are looking for land to recycle--are particularly attractive for “higher and better use” because so many of them are small, less economical to operate than larger parks and cheaper to close because relocation payments are less.

Of the South Bay’s 126 parks, 112, or 90%, have fewer than 100 spaces, according to city planning officials. The average park is 30 years old. Statewide, 72% of all parks have less than 100 spaces, according to state housing officials, and the median park age is 21 years. Nearly 90% of the state’s parks were built before 1974, only 8% of them were built between 1975 and 1979, and only 3% since then.

Condos More Profitable

“There are going to be more closures,” Torrance Councilman Tim Mock predicted. “The price of land has gone up and developers are finding that it is more profitable to build condos or commercial projects.”

The value of land has increased at such a rate that monthly lot rents at older mobile-home parks--the statewide average is about $200--do not reflect their current value.

Developer Batta Vujicich purchased the Terrace View Trailer Court on Torrance Boulevard in Torrance in 1984 with the intent of building condominiums on the 3.19-acre site. Monthly rents at the 43-space park are between $200 and $220. Vujicich would not say how much he paid for the property, but he said that for him to keep the property as a mobile-home park and make an 8% to 12% return on his investment he would have to triple rents, primarily because of the high price of the land.

He said he hopes to build 87 condominiums and sell them for between $155,000 and $170,000.

33-Space Park for Sale

The increase in land value is also evident in negotiations for sale of a 33-space park along Century Boulevard in Inglewood to the city’s Redevelopment Agency.

According to John J. Bihary Sr., a Carson appraiser who specializes in mobile-home parks, the park owner purchased the park eight years ago for about $165,000. Bihary appraised the land for the owner at more than $500,000. A spokeswoman for the city’s Redevelopment Agency would not comment on the negotiations because they are pending.

The key to whether a park closes, according to Hawthorne Councilman Steve Andersen, a real estate attorney who has been involved in the closing of parks for clients outside Hawthorne, is its location, its possible other uses and its potential income.

Andersen said prime candidates for closure are older parks that find themselves on major commercial streets--such as Manhattan Beach Boulevard in Lawndale, Pacific Coast Highway in Lomita, Hawthorne Boulevard in Torrance and Rosecrans Avenue in Hawthorne. In many cases, he said, the parks have been rezoned to be consistent with the surrounding area.

When a park is already zoned for apartments or condominiums, commercial or industrial uses, a change in land use often can be approved administratively without variances or public hearings.

Tenants Fight Back as Need for Housing Grows

But city officials in the South Bay and throughout the state may be forced to deal with the issue in a broader sense as more parks close, tenants and their lawyers say.

Mary Lee, an attorney for the Western Center for Law and Poverty who is representing tenants at Maury’s, said Hawthorne city officials have done little to assist her clients.

“Their attitude has been that this problem will simply go away on its own,” she said. “Well, it’s not going away. My clients are not the only ones being affected by this.”

The state report found a significant demand for more family mobile-home park spaces, particularly in urban areas where conventional housing costs are high. The report said the shortage will likely become more acute because the appeal of mobile homes appears to be shifting from traditional senior and retired households toward a younger tenant group.

Shift May Accelerate

The report said that court decisions banning discrimination against children in mobile-home parks may result in a rapid increase in this shift.

Some officials acknowledge that they favor the closure of some parks because they are old and can even be public health problems.

“Referring to them as parks is a misnomer,” said city planner Bill Barnett in Inglewood, where the Redevelopment Agency is trying to buy its third park for redevelopment. Of the city’s nine remaining parks, he said, “none has over 35 spaces, their physical condition is poor and there is a definite lack of amenities. We are not shedding too many tears about them closing.”

Said Inglewood Deputy City Manager Lew Pond: “Trailer courts provide affordable housing only when the trailers provide a decent place to live. There is no social benefit when these trailers are in a state that they are not fit to live in.”

Parks Run Down

Pond said the trailer courts in Inglewood are in such bad shape that it looks as if they will be replaced only if the city buys them, and the city is unlikely to buy them all.

“In most cases in Inglewood, the trailer courts are not in very attractive neighborhoods,” he said. “As much as we are seeing mini-malls springing up everywhere, I don’t see them going up there. They have not turned over naturally through private development.”

Unlike a private developer, when a public agency removes mobile-home parks or any other so-called “affordable” housing, state and federal laws require that it be replaced within four years. Pond said the city is providing replacement housing and relocation assistance to the people it is displacing.

Private developers closing parks need only file the impact statement with the city or county government, although state law allows the local governments to require relocation aid. That has usually meant providing tenants with a sum equal to a deposit and first and last month’s rent at an apartment, city officials say, or a maximum of $2,500.

Few New Parks

If economic considerations are the main reason parks are closing, they are also the chief obstacle--but not the only one--to building new parks.

Bihary, the appraiser, said development costs, including land, for a mobile-home park were between $1,500 and $3,000 per space about 30 years ago. Today, he said, the cost for a new park in an urban area like the South Bay would be between $28,000 and $32,000 per space.

“That’s why there are no new parks being built today,” he said. “The only place you can go is in the boonies, and no one wants to live in the boonies.”

The state study last year found many obstacles to the creation of new parks, including:

- The limited availability and high cost of suitable sites, particularly in urban areas.

- Local regulations and procedural and financial disincentives, including density and other standards and fees.

- Rent control, which denies park owners an adequate return on their investment.

- Age restrictions. Fewer than one-quarter of the mobile-home spaces in the state are in parks that permit children.

- Community opposition to low-cost housing in general, and to mobile-home parks in particular, resulting in additional restrictive regulations and processing delays.

- A perception that family mobile-home parks are more difficult and costly for park owners to manage.

The study came up with few ways to increase incentives for developing a park, concluding that “alternatives which would require increased state regulation of local planning processes conflict with accepted principles of local autonomy in land-use decisions. In any event, such regulation is difficult to enforce and is often ignored or avoided by local agencies.”

City and State Agencies Assist Tenants of Parks

For all the closures, tenants of one South Bay mobile park have managed to save their homes with the help of a cooperative city government.

A few years ago, a group of doctors purchased the three-acre, 50-space Village Mobile Home Park in Gardena and told residents they would have to move. The doctors planned to build a medical and retail facility.

Residents went to the city and asked for help in purchasing the park, and the city came up with this plan:

It would sell the doctors a city-owned 6.5-acre parcel for their development. The city had obtained the land from the state Department of Transportation and sold it to the developer at cost. The city then issued $1.4 million in revenue bonds to buy the park from the developers for what they had paid for it.

Tenants Pay Off Bonds

Residents, who have formed a cooperative to share ownership for the park, are paying off the bonds with their $300-a-month rent payments.

“This is the solution to the mobile-home park problem that is plaguing other South Bay cities,” City Manager Ken Landau said. “It doesn’t involve any taxpayers’ money or any state funds.”

Landau noted, however, that this option is not always available because not all cities have land available to swap with developers.

That is one of the reasons why the state Department of Housing and Community Development started its own loan fund to help tenants purchase their parks. Julie Stewart, a spokeswoman for the department, said $5.8 million has been provided to 12 parks--none in the South Bay--in the two years since the funding began. The governor is proposing another $2.5 million for 1987-88.

Some Laws Flawed

The state has also taken the lead in providing legislation regulating parks, but it has had to play catch-up after finding flaws in the laws.

One of those flaws was discovered only last year. Until it was amended effective Jan. 1, the law requiring impact reports from owners wanting to close parks did not apply to charter cities, such as Torrance, Inglewood and Redondo Beach.

The state law also says local governments “may” impose requirements to mitigate the displacement of residents as long as such measures do not exceed the “reasonable” costs of relocation.

Such wording is open to interpretation, some tenants argue, and can leave them short of adequate compensation.

No Specific Amount

“They made a stab at it, but like anything else you have various interest groups involved,” said John G. Tennyson, a consultant to the Senate Select Committee on Mobilehomes in Sacramento. “They couldn’t agree at the state level on a specific amount for relocation, so they left it to local governments to request specific amounts. It is now left to the attitudes of the people on planning commissions and city councils.”

In the South Bay, that has usually meant no more than $2,500. The exception has been in Torrance--which is going through its first application of the state law--where developer Vujicich will provide up to $10,000 per household for tenants over 60 and $7,500 for younger tenants.

The city of Los Angeles is also considering raising its maximum limit from $2,500 to $4,500.

Last year, nearly 50 bills relating to mobile homes were introduced in the state Legislature. Only about half made it into law. Under new laws effective Jan. 1:

- Park owners are required to notify tenants that the park is for sale before listing. This will allow park tenants to make an offer if they are interested in purchasing the park, or have more time to prepare to move if the land use changes.

- Parks purchased by tenants in a nonprofit corporation or cooperative before Jan. 1, 1989, will not be subject to reassessment for property-tax purposes.

- A central coordinating office--known as the Mobile Home Ombudsman--has been created within the Department of Housing to act as a general complaint center for mobile home problems.

Some Bills Failed

Among the bills that were introduced last year but died in committee or on the Assembly floor were measures that would have:

- Established a $200-million bond act for the construction or financing of rental-housing developments, including mobile-home parks, if a certain percentage of the units are reserved for the elderly. The act would have been subject to voter approval.

- Required a park owner to offer first right of refusal to tenants in the sale of the park.

- Eliminated the 7% annual interest rate for loans made to tenants buying their park through the state Mobilehome Park Purchase Fund.

But nothing has been done statewide or locally to save parks scheduled to close this year, including Maury’s Trailer Park in Hawthorne.

‘These Are Scary Times’

“There are no housing alternatives for these displaced people,” said Lee, the attorney representing Maury’s tenants. “These are very scary times.”

“People, especially senior citizens, move here to retire,” said Betty Chapman, president of the Lomita Mobile Home Tenants Assn., who lives at the Palos Verdes Mobile Home Park that is up for sale. “Now, they are going to have to re-retire somewhere else.”

Lee and some tenants argue that cities could help preserve mobile-home parks by loosening regulations governing them. Torrance and Hawthorne, for example, require a minimum of five acres for a new park.”

“That, in effect, will prohibit any new parks coming in because you can’t find five acres anywhere,” said one city official, who asked not to be identified.

‘Affordable Housing’

“People may not politically like to site mobile home parks, but it is a fact of life that they provide a form of affordable housing,” said Bernida Reagan, an attorney for Public Counsel, a public-interest law office of the Los Angeles County and Beverly Hills Bar associations. Reagan represents tenants at the Amberlight park in Hawthorne.

“Cities have to consider mobile homes as part of their housing stock, and they have to identify goals and programs to maintain mobile homes as part of their housing stock.”

Tenants of Maury’s Trailer Park in Hawthorne have also sought, without success, the city’s help in finding a parcel they could purchase for another park. City Manager R. Kenneth Jue said an appropriate site could not be found.

But Lee argues that the city could find a site if it really wanted to.

“Cities grant variances and permits, and have to approve specific projects,” she said. “Cities could say, ‘We are not going to tip the scales so that the owner only goes away with a pinch of discomfort and the coach owners are going to be left homeless.’ It is not commercially viable to have low-income housing anywhere, but we have to look beyond monetary returns and look at the health and safety of all people.”