Zell's deals don't work for everyone

Zell's deals don't work for everyone
BY CAROL MARIN
April 8, 2007
Copyright by The Chicago Sun-Times
Dear Sam Zell, I haven't written in a while but thought this might be a good time to reach out to you again.

Last time around, because it was so darn hard to get a hold of you, I tried hand-delivering a letter requesting an interview, giving it to the doorman of your elegant apartment building downtown. You let my editors know pretty quickly that you weren't too happy about that. So I'm trying this new approach.

I feel that you and I have a kinship, Mr. Zell. We're in the same business now given your planned $8.2 billion acquisition of the Chicago Tribune. Though I work for the competing paper and though you and I operate on vastly different economic scales, we're both engaged in news.

The reason for this letter, and the last one too, is about a news story that affects 300,000 people here in Illinois and a few million across the country. The majority of them are around your age, 65, though some are older.

These seniors live in manufactured home communities, what we used to call mobile home parks. And you, Mr. Zell, through your Equity LifeStyle Properties, have in recent years become the country's biggest landlord for this type of housing.

A couple of years ago, I visited two of your properties, Willow Lake Estates in Elgin and Golf Vista in Monee. They are lovely places that challenge any negative stereotype of a "trailer park." The lawns are well kept, the homes are beautifully maintained, and the mostly elderly residents have a clear sense of community.

But boy, do they have a problem, Mr. Zell.

You've got retired people like Phil Asplund, 80, a retired accountant, trapped. He and his wife Marian own their home, but you own the land underneath it, which your company rents to them. And since you took over, once-affordable rents tied to the consumer price index are now set at "market rate," which is whatever you say it is. Leases have gotten even more restrictive. And retirees, on fixed incomes, are depleting their savings trying to pay the increases. Many have been forced just to abandon their homes, turn the keys over to your managers, and go live with their kids.

When the Asplunds and others go to their legislators, like state Rep. Ruth Munson (R-Elgin), you have fleets of lobbyists and lawyers to outspend and outgun them. And when Munson and her colleagues, in spite of all that, manage to vote out even a small measure offering some consumer protection for those homeowners, you've got Gov. Blagojevich to veto it for you. After all, you and your wife have given him $82,000 since 2002. Not that there is necessarily a connection.

All across the country, the story is the same.

Your people claim any consumer bill to help protect these retirees is "rent control." It's not. That's a red herring, a scare tactic. Meanwhile, these residents are systematically being stripped of their rights as property owners with no means to appeal.

The Los Angeles Times, one of the papers in your new Tribune stable, last Monday reported that in one of your California communities, $600 rents are skyrocketing to between $2,000 and $5,000.

That's beyond sticker shock.

Last Wednesday you told the Tribune, "Everything I do is motivated by doing it best, doing it different, answering the questions no one else could."

Senior citizens in 25 states where you are their landlord have urgent questions for you. As small investors -- that investment being their homes -- they're hardly billionaires, but they've spent their lives working just as hard as you in order to have a dignified retirement.

On April 19, Illinois seniors will take buses to Springfield once again to plead with legislators to give them some small relief. Munson will try to persuade House Speaker Mike Madigan to let her modest consumer protection bill out of committee.

It would be great if you would take another look at the long-term implications of your company's strategy and reassess.

I've read that your favorite columnist is Charles Krauthammer. I'm no Charles Krauthammer, but on the off chance you ever read this, and want to hop on your Harley and take a ride, there are some people in Elgin and Monee I'd love for you to meet.

Best wishes,

Carol Marin