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Overview
UMH Properties Inc. (UMH) is a specialized real estate investment trust (REIT) focused on the ownership, operation, and management of manufactured home communities in a diversified portfolio spanning several states in the Northeast and surrounding regions. The company has established itself as a stalwart in the residential real estate landscape by offering a blend of affordable housing solutions and stable, recession-resistant income streams. Its expert management of these communities and integrated approach to residential leasing and manufactured home sales reflect deep industry knowledge and a commitment to maintaining a resilient asset base.
Company History and Market Position
Founded with a long-standing history in the real estate market, UMH Properties Inc. has evolved its business model from a focus solely on property ownership to a multifaceted approach that capitalizes on both leasing and sales. Having been publicly traded for several decades, the company emphasizes a balance between preserving long-term capital appreciation and meeting the immediate needs of its residents. This dual approach underscores its position as a stable provider of affordable housing and strategic asset management, giving investors insight into its dedication to operational excellence and enduring market relevance.
Business Model and Operational Strategy
UMH operates by acquiring, developing, and managing manufactured home communities. Its revenue streams are generated through:
- Residential Leasing: The company earns consistent income by leasing manufactured home sites and, in some cases, the homes themselves, ensuring long-term occupancy and stable cash flows.
- Manufactured Home Sales and Finance: Through its wholly-owned subsidiary, UMH Sales and Finance, Inc., the company facilitates sales and financing options for manufactured homes, supplementing its traditional leasing income. This subsidiary plays a crucial role in expanding the company’s service offerings by providing residents with flexible purchasing options.
- Community Infrastructure: The ownership and maintenance of the community infrastructure, including land, utility connections, streets, lighting, driveways, and other capital improvements, are vital in preserving the value and appeal of each community. These investments contribute directly to the operational sustainability and attractiveness of the properties.
The company leverages its expertise in property management, resident services, and financial structuring to enhance the long-term value of its assets while mitigating risks typically associated with cyclical economic downturns.
Manufactured Home Communities
At the core of UMH Properties Inc.'s operations are its manufactured home communities, which are designed to offer residents a blend of private home ownership and the benefits of communal infrastructure. These communities feature well-maintained common areas, essential utilities, and various on-site amenities that contribute to a high standard of residential living. The strategic selection of locations and the robust management practices allow the company to maintain stable occupancy rates and appeal to a broad demographic looking for affordable yet quality living solutions.
Subsidiary Operations: UMH Sales and Finance, Inc.
A key extension of UMH Properties Inc.'s business model is its subsidiary focused on home sales and financing. This arm of the company not only facilitates the sale of manufactured homes to current and prospective residents but also provides financing solutions designed to ease the purchasing process. The integration of sales and financing into the broader operational framework enhances the overall value proposition to customers, ensuring a seamless experience from home selection to financial planning.
Competitive Landscape and Risk Management
Operating in a niche segment of the real estate market, UMH Properties Inc. competes with other REITs and housing providers that focus on manufactured homes and affordable residential living. The company sets itself apart through its deep-rooted experience in community management, its integrated sales and finance subsidiary, and a comprehensive approach to property and asset management. While the market faces challenges such as regulatory shifts and regional economic variations, UMH effectively manages these risks through diversification of its portfolio and a steadfast focus on operational discipline.
Operational Excellence and Community Impact
The success of UMH Properties Inc. lies in its consistent attention to the quality of its communities and the value delivered to residents. By investing in infrastructure and maintaining high standards of community management, the company ensures that its properties remain attractive, functional, and competitive in the affordable housing market. This holistic strategy not only supports sustained property values but also reinforces a reputation built on stability and thoughtful management practices.
Industry-Specific Insights
In the broader context of real estate investment, manufactured home communities are recognized as a distinct asset class that offers resilience during economic downturns. The inherent recession-resistant nature of manufactured housing, combined with the structured income from long-term leases, makes UMH Properties Inc.'s business model particularly appealing for investors seeking stability. The company employs industry-specific practices in asset management and risk mitigation, ensuring that its portfolio is both robust and adaptable to market fluctuations.
Conclusion
UMH Properties Inc. embodies the principles of sophisticated asset management within the manufactured home community sector. Its integrated approach—combining residential leasing, home sales, and dedicated infrastructure management—demonstrates a commitment to quality and long-term value. With decades of operational experience and a resilient business model, UMH continues to serve as an informative case study in balancing growth with stability in a specialized sector of the real estate market.
UMH Properties, Inc. has promoted Shaya Baron to Director of Insurance, enhancing its insurance operations across states where it operates. The announcement was made by Samuel A. Landy, President and CEO, highlighting Baron's expertise in providing affordable insurance for renters. UMH, established in 1968, manages 124 manufactured home communities with around 23,400 homesites in multiple states, including New Jersey and New York. This leadership change aims to strengthen UMH’s insurance strategy, ensuring adequate coverage for its operational needs.
UMH Properties, Inc. has announced the promotion of T.C. Sheppard to Vice President of Consumer Finance. Samuel A. Landy, the company's CEO, praised Sheppard's contributions, highlighting his role in enhancing financing options leading to increased home sales in their manufactured home communities. UMH Properties operates 124 communities across several states, providing reliable income streams through successful financing initiatives. The company aims to expand its sales and finance operations further.
UMH Properties, Inc. (NYSE: UMH) announced the promotion of Aaron Potter to Director of ESG, effective December 17, 2020. Potter, who joined the company in 2017, will lead efforts in sustainability, social responsibility, and diversity. Under his leadership, UMH aims to enhance its commitment to quality affordable housing, with rent starting at $750 for three-bedroom homes. The company emphasizes its initiatives that align with environmental, social, and governance (ESG) principles, aiming to improve shareholder returns through responsible practices.
UMH Properties announced participation in the Nareit’s REITworld: 2020 Annual Conference, scheduled for November 17-19, 2020. Key executives, including President Samuel A. Landy and CFO Anna T. Chew, will present on November 19 at 10:30 a.m. ET. Interested attendees can register for free and access the presentation, available on demand for two weeks post-conference. UMH Properties operates 124 manufactured home communities across several states, including New Jersey and New York, with approximately 23,400 homesites.
UMH Properties, Inc. (NYSE:UMH) reported a 16% increase in Total Income for Q3 2020, reaching $43.1 million compared to $37.3 million in Q3 2019. However, it faced a net loss of $12.8 million or $0.31 per diluted share due to changes in marketable securities, down from a net income of $5.6 million the previous year. Funds from Operations (FFO) decreased to $4.5 million or $0.11 per diluted share. Conversely, Normalized FFO rose to $7.4 million, marking a 20% increase year-over-year. The company also redeemed its Series B Preferred Stock, affecting financial metrics positively going forward.
UMH Properties, Inc. (NYSE: UMH) announced the redemption of 3,800,669 shares of its 8.0% Series B Cumulative Redeemable Preferred Stock on October 20, 2020. The total redemption price was $25.2722 per share, consisting of the $25.00 liquidation preference plus $0.2722 in accrued dividends. Funding for this redemption was primarily sourced from a $106 million credit facility obtained from Fannie Mae at a fixed rate of 2.62%. This move is expected to save the company over $5 million annually, allowing for further acquisitions and expansions.
UMH Properties has secured a $20 million revolving line of credit from FirstBank, expandable to $30 million. This facility, with a three-year term, is secured by rental homes in several manufactured home communities. CEO Samuel A. Landy emphasized the importance of affordable housing, noting a 95% rental occupancy and 98% rent collection rate during the COVID-19 crisis. By leveraging rental home equity, UMH aims to enhance housing quality while increasing returns for shareholders.
UMH Properties, Inc. declared a quarterly cash dividend of $0.18 per share on its Common Stock, payable on December 15, 2020, with a record date of November 16, 2020. The annual dividend rate for the Common Stock stands at $0.72 per share.
Additionally, a quarterly dividend of $0.421875 per share was declared for the 6.75% Series C Preferred Stock and $0.3984375 per share for the 6.375% Series D Preferred Stock, both payable on December 15, 2020, also with a record date of November 16, 2020.
UMH Properties has announced the promotion of Nelli Madden to Vice President of Investor Relations, effective October 1, 2020. Nelli has been with the company for over eight years, serving as the Director of Investor Relations for the past five years. Samuel A. Landy, President and CEO, praised her performance in building relationships with shareholders, analysts, and investment bankers. The company operates 124 manufactured home communities across several states, managing approximately 23,400 homesites and a portfolio of REIT securities.
UMH Properties, Inc. (NYSE:UMH) will host a Third Quarter 2020 Financial Results Webcast and Conference Call on November 5, 2020, at 10:00 a.m. ET. The company plans to release its Q3 results on November 4, 2020, after market close, available on their website. UMH operates 124 manufactured home communities across multiple states, with approximately 23,400 homesites. The call can be accessed domestically at 877-513-1898 or internationally at 412-902-4147. A replay will be available from 12:00 p.m. ET on November 5 until February 1, 2021.
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