How Lack of Proper Care of a Prime Asset Sets Up a Financial Nightmare
By Justin Eldredge
There is an asset that’s often overlooked in the manufactured housing industry. It’s widely used by residents and owners, and it’s often one of a community’s most valuable investments. It’s also one of the most neglected.
We are talking about asphalt.
Asphalt is one of the most widely used materials on the planet. Roughly 94 percent of all roads in the U.S. are paved with asphalt, and industry revenue is approximately $33 billion a year. Asphalt is widely used because it is durable and cost-effective. If you own or manage a manufactured housing property, that property probably has asphalt roads or parking lots.
But for all its positives, asphalt is not infallible. It is a deteriorating asset that, if neglected, can end up costing thousands or hundreds of thousands of dollars to repair or replace. In this article, we’ll discuss why you should pay attention to your asphalt, the importance of proper maintenance, and the drawbacks and costs of deferred maintenance.
Understanding Asphalt Degradation
Before we go too far, it’s essential to understand a few basics.
Asphalt has two parts: the aggregate (small rocks) and the binder (the glue that holds everything together).
Asphalt begins to deteriorate almost immediately after it’s installed. Several factors cause the asphalt to oxidize, which makes the asphalt binder harden and eventually crack.
Weather conditions like rain, snow, and extreme temperatures can accelerate oxidation.
In the manufactured housing industry, these environmental factors are usually some of the biggest culprits of asphalt aging and oxidizing.
Asphalt’s life expectancy can dramatically decrease without proper maintenance, leading to costly repairs. According to the Asphalt Pavement Alliance, well-maintained asphalt has a life expectancy of 15 to 20 years. In contrast, neglected surfaces may need significant repairs or replacement in as little as five years.
The Cost of Neglect
The financial implications of neglecting asphalt maintenance depend on the amount of asphalt in the community, but the numbers can be staggering.
Regular maintenance costs are significantly lower than the expenses of extensive repairs or complete replacements. For example, the National Asphalt Pavement Association estimates that for every $1 spent on preserving and maintaining asphalt assets, owners save $6 to $10 in future repairs.
In the HOA industry, when communities perform proper preventative maintenance on their asphalt assets, they routinely see projected savings of over $1 million over the life of the asset.
Community Acceptance and Aesthetic Considerations
Beyond the financial aspects, the condition of your roads, parking areas, and pathways directly impacts community acceptance.
Poorly maintained asphalt can lead to cracking or potholes, which can decrease the property’s perceived value and negatively impact the living experience in that community.
Aesthetically, well-kept roads enhance the overall look of a community, boosting curb appeal and potentially increasing property values. A National Association of Home Builders study found that good exterior aesthetics could enhance property values by up to 7 percent.
Maintenance and Strategies for Longevity
Several maintenance strategies can be employed to ensure the longevity of asphalt assets. It’s important to remember, though, that early action is paramount. There is a common misconception that once you install new asphalt, it will stay good for decades before it requires any maintenance.
This isn’t the case.
A large portion of asphalt deterioration occurs within the first four years of its life, so the earlier you act to prevent age hardening, the longer you can expect asphalt to last.
Surface treatments should be utilized early in the asphalt’s lifecycle to protect and extend the life of the underlying pavements.
This is where you need to be careful, though. Seal coats are often used as a catch-all in the pavement preservation industry, but seal coats are just one category of surface treatment, and they are usually not the most effective at preserving asphalt assets.
Depending on the condition of the asphalt, treatments like high density mineral bonds and slurry seals might provide more extension of asphalt life than traditional seal coats.
Financial Planning for Asphalt Maintenance
We’ll likely cover this topic in more detail in future articles, but proactive financial planning for asphalt maintenance is vital. Setting aside funds for regular upkeep can prevent the need for unexpected financial outlays on major repairs. Communities can take a page straight out of the HOA playbook and consider establishing a dedicated reserve fund for infrastructure maintenance.
These types of funds are required for associations in certain states and could benefit the manufactured housing industry as well.
Leveraging Professional Help
Before undertaking an asphalt project, it is best practice to consult an expert. Pavements aren’t created equal, and taking the wrong course of action can have almost as much of a negative impact as taking no action. A professional in the asphalt industry will help you determine the best course of action to maintain your asphalt assets and achieve the maximum extension of asphalt life for every dollar spent.
Maintaining asphalt assets in manufactured housing communities is not just about avoiding costs but investing in the community’s future. Regular upkeep not only saves money in the long term but also enhances safety and aesthetic appeal, contributing to a more vibrant and desirable living environment.
Justin Eldredge, of Holbrook Asphalt Company, consults with public agencies and HOAs throughout the U.S. to extend the life of asphalt assets. He frequently contributes to industry and community publications, advocating for and educating asphalt owners on cost-effective best practices for asphalt ownership. Eldredge serves as the marketing director at Holbrook Asphalt. He can be reached at justin@preserveasphalt. com. For a free Asset Preservation Journal detailing the pros and cons of various maintenance treatments, email report@ preserveasphalt.com with Asset Journal in the subject line.
