The possibilities of Co-Ops

Boston has few co-op apartments for a city its size. While there are a bunch in the South End and a few more scattered around, the majority seem to be political communes in Jamaica Plain. The vast majority of multifamily homes are either owned by a single entity or are condominia.

A co-op is distinct from a condo in that the cooperative member owns a share in the cooperative and not a specific apartment, while the condo owner owns a specific unit. More importantly, a co-op is a type of corporation that can own property and have assets while condo buildings are jointly owned by the condo owners and managed by the condo association.

What this means is that the condo association doesn’t exist until the condos have been built and sold, but a co-op could conceivably be incorporated before the construction or acquisition of the property.

In a tight housing market fraught with opposition to new construction, such as Boston or San Francisco, a group of families could pool their resources together and foerm a co-op. The co-op could then grow for a bit until it was capable of getting financing and buying a property for development. This arrangement would have an advantage over more common developments because the co-op proponents would have a ready-made support base to bring to public meetings, the current residents would be able to meet their future neighbors and it would be more evident that they were responsible people and not random tenants or foreign investors looking to park their money in the United States.

This sort of direct interaction, I believe, would help the co-op get important variances that would likely be neccesary, such as for height, density and parking.

More importantly, it’s a tried and true model of housing development in Europe and even in parts of the United States.

In 2011, ten percent of the housing stock in Germany was under cooperative management. According to Enkeleda Kadriu and Gabriele Wendorf, cooperative housing developed in Germany in the second half of the 19th century in response to housing shortages in the growing industrial cities.

According to Charlie Gardner, housing cooperatives had some ground floor units as commercial space, which they leased to businesses. The rental income could help offset the co-op members’ obligations.

Co-op housing development has been succesful elsewhere. In Israel, the neighborhood of Mea She’arim was built by a cooperative and, although the housing itself was not cooperative, the United Kingdom’s building societies have cooperatively financed housing construction and purchasing for around 200 years.

According to Herbert Fisher of Chicago’s Center for Cooperative Housing Development, the federal government established a 40 year mortgage program for co-ops and the default rate has been negligible if not zero. “Cooperative developments . . . benefit from only having to buy one title insurance policy, not one for every dwelling unit.” he said in 2012. ” Cooperative developments only need one boundary and building survey, not a three-dimensional survey or one for every dwelling unit.  There is a high probability that the cooperative will not provide [a] commission to a broker.”

Architecturally, co-ops have followed the broader trends in their countries of origin. Many co-ops built in New York City, for example, have been automobile-oriented, towers-in-a-park. For example, Co-Op City’s stock is indistinguishable from that built by the New York City Housing Authority or the Metropolitan Life Insurance Corporation. A new, affordable co-op built in Queens, in contrast, has the brick-and-plaster look common to recent buildings, as well as ground-floor retail.

While Boston has a tax exemption of housing cooperatives, most of existing ones are fairly small and usually have some sort of catch, like communal life, that blunts their attractiveness to most people.



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