By Scott Carlson
In a bid to protect local businesses from being priced out of their spaces and to promote small businesses in community owned real estate, the Creative Enterprise Zone in south St. Anthony Park has just created a real estate investment cooperative.
Dubbed the Taproot Investment Cooperative, the for-profit real estate investment cooperative, will allow individuals and businesses to collectively invest in real estate for the benefit of their community and to receive a modest return on their investment, officials said.
Sherm Eagles (left) and Angela Casselton, executive director of the Creative Enterprise Zone, have been active in seeing the Taproot Investment Cooperative come to fruition. Photo by Lou Michaels.
“CEZ’s mission to protect creative entrepreneurs in the neighborhood means that we need more community controlled real estate where they can do their work, without risk of displacement,” said Renee Spillum, CEZ board chairwoman and head of its Real Estate Committee.
“Taproot will be an essential partner in bringing our community’s resources in alignment with our values — allowing individual neighbors to invest in the community stability that makes this a wonderful place to live,” Spillum said. “When you invest in the buildings that house the small businesses where you shop, you can truly be a part of an interdependent community where we all thrive together.”
Sherm Eagles, a co-founder of the new real estate cooperative, agreed, noting, “The idea is to create shared community control of real estate that takes the best practices from the private sector and applies them in a values-first approach that prioritizes small business stability, equity, access to space for creative entrepreneurs and environmental stewardship.”
The Taproot cooperative is modeled after one that formed about a decade ago in northeast Minneapolis, Eagles said. The idea has gained momentum in the past several years “as property along University Avenue increased rapidly in value and it became obvious that many small businesses would be priced out of their space. Last fall it started to take shape with the help of the Creative Enterprise Zone and Nexus Community Partners.”
Eagles explained, “We hope to democratize real estate investment so that many people making a relatively small investment can join together to make a difference in their own city and neighborhood and to actually be able to see that difference for themselves.”
Each Taproot member will have a say in decision-making on how the assets of the cooperative will be invested and will know the details about each investment and choose if they wish to join in each investment, Eagles said.
Now that the cooperative is established the next step is recruiting members and preparing for an initial investment opportunity.
“We hope such an opportunity will occur within Taproot’s first year,” Eagles said.
The founding group will serve as the initial board of directors until a members meeting is held during the cooperative’s first year; thereafter members will elect a board to manage the cooperative.
Founding members of the real estate cooperative are Eagles, long-term St. Anthony Park residents Ann Juergens and Marty Ruddy, and small business owners and workers in the Creative Enterprise Zone: Jennifer Closner of Grahns Upholstery, Jill Pavlak of Urban Growler, Nolan Morice of Line Break Media and Nkuli Shongwe of Nexus Community Partners.
Eagles said the value of community ownership of commercial property “has been demonstrated by the work done by the Creative Enterprise Zone to acquire the old Sunrise bank building at University Avenue and Vandalia.
“This building now houses several community-based organizations, including the CEZ and the St. Anthony Park Community Council,” he said. “Supporters of the CEZ helped raise the capital necessary to purchase this building.”
Eagles asserted, “We believe that by creating a way to raise capital from more people living and working in the area, as well as others who support our creative small businesses, we can bring more buildings under community-based ownership, keep commercial and industrial space affordable and prevent displacement of our small locally owned businesses.”
By cooperatively making a collective investment, the personal risk of making financial investments can be mitigated while still earning a return on the investment, Eagles added.
Scott Carlson is managing editor of the Bugle.
