When the owner of a mobile home park in southeast Brainerd decided to sell, he made what may have been an unusual decision.
Owner Bill Halverstadt decided to give the residents who live in the 14-acre Meadowview Manor park the opportunity to buy it and pointed them in the direction of help to make it happen. It started the residents on a path of forming a cooperative to manage a resident-owned park.
Halverstadt said his decision followed a family tradition to share with others the benefits he's received in life.
"I'm glad to turn it over to the tenants," Halverstadt said. "It's good for the tenants because they will have the confidence and a brighter future. It gives them some certainty they otherwise would not have."
A curious child rode by to check out the new manufactured home arriving at Meadowview Manor Mobile Home Community in southeast Brainerd. Jason Hardy (left), park manager, and Rudy Estrada, Quality Mobile Transport of Forest Lake, fought with ice as they worked to place the home Friday.
Brainerd Dispatch/Renee Richardson
Sharon Magnan, Meadowview Cooperative president, has lived in the park for eight years. Magnan said as a community, residents decided owning the park themselves provided them with the greatest security.
"Because our fear was that should the current owner sell it to a developer or for any other reason we were all out of a home or at least out of a place to put our home," Magnan said.
They found help with the Northcountry Cooperative Foundation, a Minneapolis-based nonprofit established in 2000 by a development fund with a 30-year history. Northcountry Cooperative Foundation was designed to help cooperatives and has a focus on affordable housing.
"To date we've worked with the residents of four communities to create four manufactured housing cooperatives in Minnesota," said Kevin Walker, Northcountry housing development director. Communities helped include Moorhead, Lexington, Madelia, Cannon Falls and Cumberland, Wis.
Walker said supporters of this project are not reinventing the wheel, but are drawing from a lengthy history of resident-owned manufactured home communities in New Hampshire where 20 percent of the parks, more than 100, are now owned by resident cooperatives. Studies of the 30-year history in New Hampshire have found resident-owned parks have lower lot rents, sell more quickly for a higher value and are in parks that are more well-maintained, Walker said. The residents have a vested interest in being economically efficient.
Existing residents typically have an option to become members of the cooperative or pay lot rent to the membership. Income goes back into the park for maintenance, operating expenses and a reserve fund.
Northcountry provides training and technical support and helps put together the bedrock for the purchase process. The nonprofit provides training and technical support to residents with information on how to navigate disputes, how to run an effective board meeting and manage the property.
The process hasn't been without bumps and setbacks. This project has taken longer to put together than originally planned and Northcountry and the residents are still working with lenders. A purchase agreement is in place giving residents the option to buy the property into the fall. The hope is to have the purchase completed by early summer.
Northcountry, which has access to federal surplus homes, is helping by bringing in manufactured homes constructed between 2005 and 2008. Most have not been previously occupied. But even free homes come with costs. Walker said it costs about $17,000 to get a manufactured home to the site and installed. But the cooperative has the opportunity to sell the fully furnished home to a qualified buyer.
Meadowview Manor had 94 lots with the potential to expand another six where - before Friday - there were lots but no manufactured homes in place. The arrival of a manufactured home on Friday cut that number to five. In addition, there are seven undeveloped lots.
The arrival of the manufactured homes strengthens the cooperative's bottom line and brings in new members. Each adds about $25,000 in capitalized value to the real estate and provides operating revenue, Walker said. Occupancy is a core part in how Meadowview Cooperative will be able to purchase the property and shrink the financing gap, Walker said.
Thirteen of the homes are committed to be placed at Meadowview. Once the manufactured home is set up, it has a market value of $25,000 to $34,000. A qualified resident may occupy the home for 18 months and then is in a position to purchase it.
The homes were able to be obtained by a partnership with the park owner and the Crow Wing County Housing and Redevelopment Authority each committing funds to place seven homes on open lots.
The Minnesota Housing Partnership reported there were 74,000 manufactured homes in the state as of 2008 with 65,000 of them owner-occupied. Walker said the manufactured home communities are the state's largest single source of unsubsidized affordable housing in the state. But mobile home parks face pressure for redevelopment and park owners may have little incentive to invest in park improvements. Walker said six to eight communities close each year in Minnesota on average.
With the purchase, residents at Meadowview will have control over their own fate.
Magnan said: "It's getting people enthused and working together and finding out it's really nice to be part of something and have a say in what happens."
RENEE RICHARDSON may be reached at firstname.lastname@example.org or 855-5852.
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