Updates Challenge to San Rafael California Rent Control

CHICAGO, Oct. 9 /PRNewswire-FirstCall/ -- Manufactured Home Communities, Inc. (NYSE: MHC) today announced that it expects Funds From Operations (FFO) for the third quarter of 2002 to be $0.58 per share as compared to the First Call consensus estimate of $0.62 per share.  This revised FFO estimate reflects a decline in earnings from both used and new home sales due to the difficult financing environment for manufactured homebuyers as well as the competitive pressure from single-family home sales activity in certain markets.  The Company also expects to achieve core net operating income (NOI) growth for the third quarter of approximately 3 percent due to increased expenses for real estate taxes and business and employment insurance.  MHC had previously estimated core NOI growth of 4 percent.

For the full year of 2002, FFO is expected to fall within the range of $2.48 to $2.52 per share as compared to the First Call consensus of $2.56 per share.  These revised FFO estimates reflect the continuing difficult environment for used and new home sales as well as the expense increases noted above.

MHC expects to provide guidance with respect to 2003 operating performance when the Company announces third quarter 2002 results on October 22, 2002.

The Company also announced that a federal court trial, in connection with MHC's previously announced efforts to achieve a fairer regulatory environment, is scheduled to begin on October 28, 2002.  MHC sued the City of San Rafael, California in federal court in 2000.  MHC owns Contempo Marin, a 396-site community that is subject to that City's rent control ordinance.  Among other allegations, MHC has alleged that the rent control ordinance has resulted in an unconstitutional taking of the property and that the City breached a settlement agreement previously entered into with MHC.  The Company is seeking injunctive relief as well as monetary damages.

The forward-looking statements contained in this news release are subject to certain risks and uncertainties including, but not limited to, the Company's ability to maintain rental rates and occupancy; the Company's assumptions about rental and homes sales markets; the effect of interest rates as well as other risks and uncertainties indicated from time to time in the Company's filings with the Securities and Exchange Commission.  The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

Manufactured Home Communities, Inc. owns or has a controlling interest in 139 quality communities in 22 states consisting of 51,147 sites.  MHC is a self-administered, self-managed real estate investment trust (REIT) with headquarters in Chicago.

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SOURCE  Manufactured Home Communities, Inc.

    -0-                             10/09/2002

/CONTACT:  Marty McKenna, Manufactured Home Communities, Inc., +1-312-928-1901/

/Web site:  http://www.mhchomes.com  /

(MHC)

CO:  Manufactured Home Communities, Inc.
ST:  Illinois, California
IN:  RLT RLE
SU:  ERP LAW

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3706 10/09/2002 08:41 EDT http://www.prnewswire.com