However, in Minnesota’s Twin Cities, United Properties has found a niche with the developments.
“Co-ops have been around in the Twin Cities for about 30 years,” says Brian Carey, senior vice president at United. “The co-op has proven to be a stable real estate asset.”
Most co-ops are found in the Midwest, where a sense of community is important says NREI Online. Similar to the co-ops often found in Manhattan, the units are different because they have age restrictions. Senior co-ops also often limit the resale price of the units, a feature that potential buyers find attractive. “There are no speculators creating a bubble like we saw with condos,” says Carey.
The drop in home values has created a challenge for United, who says there has been no shortage in people interested in moving into the units, but selling their homes is the challenge.
Even so, Carey notes that vacancies overall are less than 2%. Even during the downturn, small units have not been the best sellers. The most popular unit is still the two- bedroom, two-bath apartment with a den. “Residents are moving from a house and they want space,” notes Carey.