New KW Co-op is the First of its Kind in Canada

The photo above is of Fair State Brewing Cooperative, Minnesota’s first and only cooperatively owned craft brewery. It’s owned by NorthEast Investment Cooperative, a model Union is inspired by.

Ten Kitchener-Waterloo residents have recently started a new co-op that is the first of its kind in Ontario, and believed to be the first of its kind in all of Canada. Founded by Aaron Stauch, Alex Szaflarska, Anthony Piscitelli, Joel Marcus, Kristen Eicher, Laura Hamilton, Nicole Langlois, Ray Gormley, Sarah Brown and Sean Campbell, Union: Sustainable Development Co-operative is a real estate development co-operative that is looking to get things running this spring.

“Union is a new cooperative that’s been started to empower community members to collectively buy property and manage it together for the environmental and social benefit of our community,” Sean Campbell, one of the founding members and volunteer executive director of Union said.

Campbell said that through his work as a non-profit charity consultant, he had been looking across the country at alternative options for community groups to raise money.

He came across a story out of Sangudo, Alberta — a small farming town of less than 500 people. The town was experiencing decline, as young people were moving to Edmonton and the local meat packing plant was going out of business, ultimately affecting the farmers’ work, as well as threatening jobs within the plant.

In efforts to rescue the plant, the community came together, bought the building, renovated it and gave a long-term, low-interest loan to two men who worked there to keep it running.

Campbell explained that a similar model was used in Vancouver to create affordable housing, and the NorthEast Investment Cooperative in Minneapolis is using the co-op model to buy, rehabilitate and manage commercial and residential housing.

The NorthEast Investment Cooperative’s model attracted Campbell and his colleagues, but there was nothing similar happening close to home — so, they started it themselves.

The idea is that Union, which currently consists of ten people, will grow and attract more investors. Once the investment pool builds, they will buy their first property: a mixed-use commercial and residential building. The investment cap is at $10,000 to ensure equity among members and added risk protection.

Union will then act as a “benevolent property management company,” with stipulations on lease agreements that will cater to and benefit the greater KW community. These stipulations could include the implementation of a composting program or sexual harassment policy for commercial or retail tenants, Campbell hypothetically suggested.

Those tenants will also become a member of Union, ensuring that they will be involved in conversations about changes to rent or other decisions made about the property.

“Once we own the space, then we can make decisions about what the tenants are like that [they] are good for our community. It’s about the governance and a democratization piece. That’s what you’re buying into as a member,” Campbell said.

As mentioned above, Union is currently looking at available properties to buy their first building: a mixed-use commercial and residential space. They’ve begun working with Whitney, a commercial real estate firm, and have teamed up with Reception House for their first property. The residential spaces in this first building will be intended to house government-assisted refugees.

For over 30 years, Reception House has welcomed government-assisted refugees to Waterloo Region. Last year, they welcomed 300 people, predominantly comprised of large families. They spend their first period of time in the Region living at Reception House. It can take three to four months to find these families permanent housing .

“If you’re a government assisted refugee, you were screened by the United Nations [and] you were screened by the government of Canada and they said, “yeah, we think you’d be a great fit for our community and we know that you’re in need. Welcome to Canada, welcome to Waterloo Region,”” Campbell said.

“But, when they arrive, they don’t have family connections or church communities or other community groups that support them as they come in and they don’t have credit history or landlord history.”

Kathie Must, fundraising manager for Reception House, explained that the two major challenges these families are facing are language barriers and finding secure housing. Therefore, Union’s plans for their first project will help lessen these challenges.

Although affordable housing is a Region-wide concern, the folks that Reception House assist have unique challenges stacked on top of the inability to secure affordable housing.

“We know [affordable housing] is not just a newcomer issue. Very few of the issues that we face are just newcomer issues. [But] from our lens, we have some very specific challenges that go with that,” Must said.

In addition to those two most prevalent issues Must addressed — housing and language — these families are also facing biases, racism, lack of literacy in their native languages and a lack of references or credit history to assist them in rental applications.

“Housing is a critical issue in welcoming and ensuring success for settlement for refugees. We want to be a part of the community’s solution; it’s not just our issue. But, if we address affordability without considering some of the unique and very serious challenges that our clients have, we don’t believe that we will solve the problem completely,” Must said.

The retail or commercial space on the ground floor of this building could be of service to the tenants, too.

“It would be wonderful if the ground floor business might even provide work opportunities for some of the families or opportunities for them to practice English. So that becomes almost a community within a community,” Must said.

Union is holding the social, environmental and economic impact at the highest level of importance for this new venture. While they are suggesting a three to four per cent monetary gain to members who choose to invest, this project is all about empowering the community.

Sarah Brown, another founding member of Union, explained that the concept of assisting with community development and being a part of how the city grows is why she’s involved with Union.

“At this point in my life, I’m not in a position to [buy property on] my own [sic],” Brown said.

“[I like] the concept of doing it together, with others, and having just a small role to play in seeing a property or a part of this community develop around the boundaries that are important to me and being able to use this different tool to promote the social and environmental goals that can sometimes get a bit lost in traditional ways of buying and selling property.”

Right now, Union is still in the membership building stage; they’re hoping to have a meeting that’s open to the public sometime in May. Once the provincial budget is approved and they get their stamp of approval, Union can start welcoming members, hopefully later this spring. Campbell is optimistic that they’ll have the keys to their first property later this year.

“We’ve been going through a period of really exciting growth in this community. We’re seeing more people living downtown, which is really positive. We’re seeing lots of great jobs coming into the community, but that growth and that development is not being spread equally across the community. We’re seeing that prices are rising, both for commercial and residential spaces and we’re seeing that properties are being owned, not necessarily in a democratic or collective way that is benefiting the community as a whole,” Campbell said.

“We have lots of money, that we, as a community, already own … We have the resources to do this. We’ve never had the tool where we can work together in order to make decisions and make sure that this is a good place to live in ten years.”