Learn how neighbors can pool their money to make transformative real estate investments that benefit member-owners and the community.
Lend your voice, expertise, and ask questions. Take the survey by clicking on the image below:
What is a Real Estate Investment Cooperative?
The Hamline Midway REIC is a group of community members pooling their money and power to secure space for community, small business, and cultural use in St. Paul. Consistent with the principles and spirit of the cooperative movement, the Hamline Midway REIC makes long-term, stabilizing, and transformative investments for the mutual benefit of our member-owners and our community.
What is cooperative membership?
Members of the cooperative, which will make real estate investments in the community selected by members, have equal voting power and earn an equal return on their membership share based on the money earned by investments the cooperative decides to make.
What do I gain by becoming a member?
Participating in an investment cooperative provides social benefits on both a personal and community level. The Hamline Midway neighborhood does not have to accept commercial corridor neglect. Instead, collective influence and investment can make our community more beautiful and walkable by providing space for new businesses that emerge out of the community to thrive. This can be accomplished while also providing a return on the money that neighbors invest in their membership shares and additional contributions. Cooperatives are associated with many of the benefits that come with being a member of any club: forming new friendships, expanding professional networks, and gaining new skills and knowledge. Cooperatives also build inclusive and cohesive communities as each member has one vote and a voice in shaping neighborhood development through democratic decision-making processes. Owner-members collectively benefit from the sense of pride that comes with having a personal and financial stake in the neighborhood’s built environment, rather than leaving our built environment to others to shape and profit from owning.
How long does membership last?
Memberships last indefinitely and with a one-time payment you become a member for as long as you would like. However, prospective members should consider this a long-term investment as the cooperative needs to be able to count on a certain amount of membership capital for the duration of a project.
How much does it cost to become a member and where does my money go?
The cost of an individual membership has yet to be determined. Membership funds will be used to cover costs related to purchasing and developing a property chosen by the cooperative members. The investment cooperative will be as inclusive as possible, and there are a number of strategies that will be instituted to allow all interested individuals to become members regardless of their ability to pay. For instance, the cooperative could explore options like payment plans, sponsorships from other members, grant funding, time contributions, and in-kind donations to expand access to memberships.
Who is able to become a member and what is the geographic focus?
At this moment, specific limits on who can become a member have not been determined although in many cases investment/membership would be open to any Minnesota resident. However, it is important that the cooperative remains controlled by the community to achieve its goals, therefore the implementation committee will explore structures that prioritizes local residents of Hamline Midway.
How is racial equity being centered in the engagement and project?
This project aspires to build wealth and community in Hamline Midway. To truly achieve this goal the cooperative wants to ensure that those who have been systematically excluded from wealth building activities and underserved by the economic system will be centered in this initiative. This means that in recruiting an implementation committee, BIPOC leadership will be prioritized and engagement efforts will have specific focus on promoting membership for BIPOC individuals as well as overcoming language barriers where they exist in our community.
How are decisions made?
Once memberships are issued, the newly formed group of members will elect several individuals among them to serve as a Board of Directors for the cooperative going forward. The Board will work to ensure that the cooperative is on track with the project goals while the members ensure the board’s actions remain consistent with the members’ mission and values.
What are the next steps?
In the coming months, we will select and convene an implementation committee to begin work on a business and operating plan for the organization prior to officially raising funds and establishing an elected Board of Directors. The implementation committee will be a diverse group of community members with various experiences, technical expertise, and knowledge to ground the cooperative in the community-based values while building a sustainable business model. Based on the survey responses, there will be a lot of interest in being on this committee so a formal application process is being developed to select members. During this same period, the implementation committee will initiate the process of accepting formal pledges from those interested in becoming members.
How else can I get involved?
We are still working on outreach and engagement to build our participatory membership base. The best thing that interested individuals can do is watch the learning sessions and spread the word about the survey to friends and neighbors, especially people who aren’t as plugged in to the local nonprofit community. You can also apply to join the implementation committee that will be working towards structuring the cooperative and developing a business plan.
When is the site selected?
No site has been selected at this time. Final site(s) selection will be discussed and determined by the Board of Directors, with substantial engagement by the local community.
What kind of returns can I expect and would additional investment yield a higher return?
The investment cooperative model is focused on long-term investment, so quick profits should not be expected through this project. The share price and expected returns would depend on how the specific real estate development project we invest in is structured -- any additional shares purchased would not increase a member’s vote share.
Roundtable Discussion: Commercial Real Estate 101
Click Here to watch the virtual roundtable discussion:
Renee Spillum, Midway resident and community development project manager, and Nancy St. Germaine, General Contractor (Raven Construction & Creative Enterprise Zone), will provide an introductory workshop in commercial real estate development. Together we will learn about how acquisition, construction, and financing work. They will explain how a building could be transformed from a blighted, vacant structure to a vibrant community asset that we own together as a neighborhood. They will also explain key real estate terms and tools to help demystify the development process.
A real estate investment cooperative is a tool that supports community members in coming together and investing in commercial real estate. Our goal in doing this work is to capture the energy and resources of neighbors to work together to make real change, as well as to prevent displacement and disinvestment for local businesses and properties in our community.
This is the second of a two-part series on starting a real estate investment cooperative. The webinar will be recorded and a link will be posted to the Hamline Midway Coalition website by Wednesday, October 14th: https://www.hamlinemidway.org/
Roundtable Discussion: What is a Real Estate Investment Cooperative?
Click Here (or the image below) to watch the virtual roundtable discussion:
Hamline Midway Coalition is exploring the opportunity for community members to come together and invest in commercial real estate. Our goal in doing this work is to capture the energy and resources of neighbors to work together to make real change, as well as to prevent negative outcomes for local businesses and properties in our community. Join us for an opportunity to hear from local experts about community ownership of real estate, what is a Real Estate Investment Cooperatives- REIC, and how you can get involved in this initiative.
Leslie Watson, Governance, Start-up Strategist, Columinate, Founding organizer of the North East Investment Cooperative
D'Angelos Svenkeson, Founder and CEO, NEOO Partners, INC
Renee Spillum, Hamline Midway resident and Seward Redesign
Moderator - Marcq Sung, Community Reinvestment Fund
This is the first in a series of 2020 engagement opportunities to explore the feasibility of a Real Estate Investment Cooperative in the Hamline Midway neighborhood. The next step will be a survey to understand the interest in memberships and the goals/values that drive individual interest in being involved. Hamline Midway Coalition is providing learning opportunities and community engagement for this idea, which would ultimately be a separate cooperatively owned entity, with each member having a vote in its governance.
Check this article out from Yes Magazine: