An Enterprising Solution to Secure and Affordable Homeownership NCSHA – Sept. 26, 2016 Resident Ownership: An Enterprising Solution to Secure and Affordable Homeownership Michael Sloss, Managing Director, ROC USA Capital Miami Beach, Florida

Historical Context 80+/- year evolution from temporary/ recreational to permanent housing.

Historical Context

The Market Market Size: Ownership: US: 50,000 Land Lease Communities in 49 states and 2.7MM home-sites In Your State: We have a database of most, both suburban and rural. Ownership: 3 REITs: ELS , SUN, UMH 500 Portfolio Owners with 5 or more Communities 1000s of traditional developer/owners 1,000 resident-owned communities (co-ops)

Resident Owned Communities (Co-ops) Market-rate: Predominantly in FLA High co-op share values Conventional commercial financing Disaggregated local co-ops Limited-equity (ROC USA Model): 14 states Low share values High LTV financing Aggregation (scaled solutions) through Network and Association of ROCs

Cooperatives (co-ops) 1920s, bunch of small Chicago hardware stores got together because Big Boys were underpricing them Formed a co-op for cheaper prices Today, more than 4,000 stores independently owned, strengthened by national/regional Training, Discount purchasing, Marketing Everyone stand please

Make resident ownership viable and successful. Opportunity Expert Assistance Network of local Technical Assistance Providers Facilitate purchase process Informed democratic choice by homeowners Financing Forgivable loan for legal, engineering and appraisal Timely purchase and rehab financing Goal: “Just like a sale to any 3rd party buyer.”

Results to date 2006 NH Study: Expert Assistance – ROC USA Network: Comparable house prices +16% Homes in ROCs sold faster Rents lagged the market 2016 National ROC Study: After 5 years of ownership, rents are at market to as much as 17% below market (7 ROCs) >$2.1MM capital investment Disciplined financial management with reserves and audits/reviews Expert Assistance – ROC USA Network: 190 ROCs with 11,000+ homes in 14 states 8 affiliated nonprofit TA Providers Financing: ROC USA Capital: $130MM HFA Co-lenders like MN, NY, VT, WA,WI: $32.3MM, 1,433 homes Total financing in sector since mid-2008: $220MM

Make resident ownership viable and successful. Support success: Locally owned: Empowered, engaged owners/members Regionally & Nationally Strengthened: Peer-to-peer connections in person and online On-site and regional training and coaching Regional & national leadership development In state system development National ROC marketing program Online community center – myROCUSA.org Home financing “We succeed when our communities succeed.”

“Frankly, we can’t come up with any reason why a community owner would not want to sell to the residents over an outside party.” Frank Rolfe MH Journal Jan. 2016

Our Work With HFAs to Date New York- Subordinate Debt: 7 ROCs, 678 Homes Preserved $25.8 MM Combined Financing 10 yr. term, 30 yr. amortization 2.0% yield to HFA C. Minnesota - Sr. Participation: 3 ROCs, 227 Homes Preserved $7.5 MM Combined Financing, 10,15 yr. term, 30 yr. amortization 5.0% yield to HFA B. Wash.- Sr. & Pari Passu Participation 8 ROCs, 430 Homes Preserved $15.8 MM Combined Financing 10-yr. term, 30 yr. amortization 2.0% yield to HFA D. Wisc. & Vt. – Sr. Participation: 1 each, 98 Homes Preserved $5.0 MM Combined Financing 4.25% - 5.0% yield to HFA

Partner with ROC USA Capital Michael Sloss Managing Director ROC USA Capital 6 Loudon Road, Suite 501 Concord, NH 03301 E-Mail: msloss@rocusa.org Tel.: (603) 513-2813