Why a community development co-op for G.R.E.A.T?
UPDATED OCTOBER 2023 (originally published March 2023).
When it comes to creating permanent affordable housing there are a number of models and approaches, with different types of organizations taking on the challenge in their own ways. Some are for-profit developers who get financial incentives to build units. Then there are charities and non-profits which build or support affordable housing, and increasingly there are community land trusts who develop or work with partners to create affordable housing. Yet another model is what some call a community development co-operative. This is what we are doing. ”Community development cooperative” isn’t an official or legal term (but “co-operative” is), it is just a term to reflect the intent and practices of the co-op organization.
More important than what we call the the type of the co-op is that it is a co-op. Co-operatives are owned by their members and all are guided by the international co-operative principles.
Ontario Co-operative Association
As the Ontario Cooperative Association explains
A co-operative is about people coming together to meet a common need - be it economic, social, cultural, environmental - or all the above. It is a versatile business model that can operate in every sector of the economy, and in both urban and rural settings. Please note that when using the term "co-operative," we are referring to both non-financial and financial co-operative organizations.
A co-operative is a legally incorporated corporation that is owned by its members, who use the co-operative's services or purchase their products. They can and do provide virtually every product or service, and can be either for-profit or non-profit enterprises.
Co-operatives are community-focused businesses that balance people, planet and profit. They are democratic and value-based by nature, and are often formed to fill a void within a community, to seize local opportunities and to meet the needs of its member-owners. Whether the members are the customers, employees or residents, they have an equal say in what the business does and share in the profits. Profits are distributed to members based on the amount of business they do with the co-operative.
As such, co-operative businesses keep dollars circulating within the local economy, provide secure employment, and help revitalize, build and sustain healthy communities.
In this case The G.R.E.A.T Housing project will be the first project of what we call the GREAT Housing Co-operative community development co-op. We will build on community investment and community ownership to create permanent eco-affordable housing.
The good news is that while this approach to affordable housing is less common than some others, it isn’t brand new. In the U.S. the North East Investment Co-op and the East Bay Permanent Real Estate Co-operative have had success with this approach, but perhaps more exciting is another co-op in Ontario: Union: Sustainable Development Co-Operative.
Union Co-op buys residential & commercial properties in Waterloo Region for permanent affordability through community ownership. Last year the co-op, through community investment, purchased and is preserving two apartment buildings totalling 58 units, with plans to build an additional two accessible units in the building’s ground-floor garages. Investors are members of the co-op and made this purchase possible!
Unlike Union co-op, our initial focus is not on purchasing existing buildings but building eco-affordable permanent housing through community investment. Like Union the co-op will be offering shares as an investment. For G.R.E.A.T and other future projects investors, tenants and other stakeholders will have a real role in the project, it’s the co-operative way.
The GREAT Housing Co-op will have three member classes: 1) community investors 2) tenants/sub-tenants 3)community organizations. Each member can only be a member of one class at anytime. Incorporation will likely be toward the end of 2023 or early 2024.