A New Day in Clarks Grove: Hillcrest Community Cooperative is now Minnesota’s Eighth Manufactured Housing Cooperative

Clarks Grove, MN (November 18, 2015) – Members of Hillcrest Community Cooperative in Clarks Grove, Minnesota are celebrating a new milestone in affordable homeownership and community empowerment in Minnesota – the state’s eighth manufactured home park cooperative. Staff members from Northcountry Cooperative Foundation (NCF), a nonprofit organization supported the residents’ efforts to buy their community.  NCF is part of a national network of cooperative development organizations called ROC USA Network.  NCF has worked closely with residents since May 2015 to help them organize the cooperative, negotiate for, evaluate, and finance the purchase of the commercial property.  As of yesterday, Hillcrest Community Cooperative now owns and will operate the 97-unit manufactured housing community.  The Cooperative’s property includes a storage shed, office, four apartment units and an underground storm shelter.  With this purchase, there are now close to 600 home sites in resident-owned manufactured housing communities between Minnesota and Wisconsin. 
 
In manufactured housing cooperatives, each member owns a share in the cooperative. Members elect a Board of Directors to oversee the day-to-day operations of the community. Ownership of a share entitles members to a perpetual lease as long as they meet their obligations to the community.  Inherent to their ownership model, cooperatives collect only the lot rent needed to operate the community and maintain and improve the property over the long run, so that lot rents stabilize over time with resident ownership. Over sixty percent of Hillcrest Community homeowners joined the Cooperative. Remaining community residents will continue to rent their lots from the cooperative until they decide to join. Members of the cooperative will elect their first board of directors at the first annual membership meeting in late October.  The Cooperative has arranged for property management services from a variety of vendors and will employ a part-time onsite manager.
 
The Cooperative received first mortgage financing from ROC USA Capital for the $1.72 million transaction.  These combined funds enabled the cooperative to buy the park and fund reserve accounts, including an upfront funding of over $93,000 for community improvements.  Additional ongoing annual reserve contributions of $14,000 are planned.  In addition to its real estate transaction assistance, NCF will assist the new cooperative in setting up its governance and decision-making systems.
 
Lou Schumacher, interim board president of the Cooperative, explained why he took an early interest in conversion to a cooperative. “From the beginning, I supported our purchase of the property so that we can have more control over what happens in our community, ensure that capital improvements happen, and that we have greater control over our lot rents,” he said.  “This group of homeowners instinctively responded to this opportunity and led on the efforts to put this community purchase together,” noted Julie Martinez, NCF’s cooperative housing specialist, who spearheaded the organization’s support of the Cooperative.
 
The Cooperative Board held a brief ceremony with almost all of the City of Clarks Grove Council members attending.  The resident board unfurled a “We Own It!” banner in front of the Board members.  As part of the proceedings, NCF staff member Ms. Martinez gave Mr. Schumacher a hardwood gavel with the name of the cooperative and yesterday’s transaction date engraved on it. 
             
“Hillcrest Community Cooperative’s purchase is the latest in a larger national movement that has seen over 10,000 homes in these manufactured housing communities go resident-owned,” said Warren Kramer, NCF Executive Director. “The community gets a stable base of engaged property owners who are committed to working together. Co-op residents enjoy security in and control over their housing.  Our job, as a ROC USA Certified Technical Assistance Provider™ (CTAP), is to provide the right mix of development and organizational technical assistance, to support the success of and build on the strong leaders that Hillcrest Community Cooperative has found in its members in the course of their organizing process.”
 
The seller, David Reynolds and Frank Rolfe, who together are the sixth largest owner of manufactured housing communities, with over 17,000 home sites across 150 communities in 23 states, spoke positively about the transaction.  “NCF, in partnership with the residents, delivered a smooth transaction.  We were impressed with the professionalism of NCF and the responsiveness of the residents and we anticipate more sales to residents with NCF and/or other ROC USA CTAP’s around the country.“