Interview with Dennis Dunker, former owner of Sunrise Villa Cooperative, in Cannon Falls, MN, MN’s first resident-owned community.
Q: Can you tell me what your first reaction was when the homeowners expressed an interest in buying Sunrise Villa?
My first contact was with a resident who approached me about buying the land that her home was located on. She said, “Wouldn’t it be nice if I could own my own land, and then make permanent improvements to it?” This was approximately two to three years before conversion actually occurred, and she was the only resident who asked me about it.
Sometime after this, I got a postcard from Northcountry Cooperative Development, Warren Kramer’s group, suggesting that if I was thinking of selling my park, I should consider selling it to the residents.* My initial reaction was that due to the low-income level, their banding together to buy the park seemed very unlikely.
I was positive there was no way they could do it. I wasn’t even sure there was a majority of residents who wanted this. I kept Warren’s card on my desk for a few months. I did contact Warren, and over next few years he got involved. And things changed. Then, in the course of the next year Northcountry Cooperative Development formulated the process with residents, and educated them to the process.
I felt real good about this sale. This was a feather in our cap.
* Warren Kramer is Housing Program Manager for Northcountry Cooperative Foundation, a ROC USA Network Certified Technical Assistance Provider in Minnesota. Warren also serves as a Director on the ROC USA Board of Directors.
Q: What was your feeling at the real estate closing when they pulled it off?
Two things: It worked out wonderfully for me. I got top dollar. And the tenants got to own their community. The sale to the residents kept the community from being sold to a developer who was also interested in buying the land, and who was going to use it for something else.
Q: How was the process of negotiating, contracting, due diligence, and closing for you as the seller?
As I like to say about this sale, “Everyone came out whole.” My wife and I had owned the park for 22 years, and we were happy to see the tenants become owners. We knew these people well. In some cases, they had become our friends. We were happy for them that this happened.
We felt we were creating immediate access to low-cost housing in the community at large.
As I remember, the process required very little input from my perspective, once I put the park residents in touch with Warren. Northcountry Cooperative Development provided all the momentum. Occasionally Warren would contact me to get permission for soil sampling, or something. A lot of it had to do with privacy issues and making sure no one stepped on anyone’s toes. His organization was very diligent with follow up.
This was not nearly as complicated in terms of the process for me as I had expected. It requires patience on the part of park owner to allow the process to happen. It’s a timely process, requires a lot of education of park residents. Because most of the residents have not worked within a cooperative, they are concerned about the unknown. All of that takes time. Northcountry Cooperative Development set up and ran all the meetings. I did not need to spend a lot of my time.
Q: What went well?
I was happiest getting full market value, a very fair price for the park, given that we were dealing with an unknown quantity in NCF. I was skeptical in the beginning that it could be in a price range that the residents could handle. The fact that they did was a surprising and pleasing element.
Q: What could have been handled better?
I have to be real candid with you: I’d have a hard time finding something wrong with how things were handled and the quality of the Northcountry Cooperative Development’s process. We were one of the first parks being converted in MN, so maybe that was a factor in the timeline. If there was some way for this process to be speeded up and accomplished in less time, from a seller’s perspective that would have been better.**
** As noted, this was the first conversion of a community to a co-op in Minnesota. As such, it took time. Much has been done to speed up the process and get to closing quicker. We know that in many instances, we need to match what private buyers are doing in order to win over community owners.
Q: When you look back on it now, what do you think? What do you feel?
My participation in the process gave me reassurance, made me feel part of the process. They were always on top of things.
It serves a dimension in our society, to help people build equity and have stability, to keep the park from being sold out from under them when they’ve been in the community for many years.
Q: What do other park owners say when you tell them about this?
We were not looking for a lot of exposure and PR during the process. I didn’t get many calls from people. I have since talked with people who owned parks, asked them if they knew about this process. It’s pretty much an unknown quantity to them. There has not been a lot of public information about this process.