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Closure of Lowry Grove manufactured home park highlights threats to suburban affordable housing
11.08.2017

One form of “naturally occurring/unsubsidized” affordable housing comes in the form of manufactured home park communities. These communities often provide quite affordable housing, with no public subsidies, and with a number of them located in “high opportunity” suburban cities, with jobs and good schools. The Lowry Grove manufactured home park in St. Anthony Village was one such community. Residents there included a diverse mix of 100 households, including Latino families and older and disabled residents. Those families with children had access to the highly regarded St. Anthony school system. Now, all Lowry Grove residents are gone and the site sits empty. In 2016, the park owner announced his intention to sell the park to a company called The Village LLC, which would begin the process of closing the park and redeveloping the site. Minnesota law provides MN park residents with a “right of first refusal” (ROFR) in cases where a park is sold in connection with a planned closure. The law allows residents to band together and buy the park themselves by matching the purchase price and terms. Near the end of the 45 day period to exercise their purchase rights, the residents authorized affordable housing developer Aeon to make a purchase offer on their behalf. However, the park owner rejected Aeon’s offer and proceeded to close on the sale to the Village LLC. The residents, represented by HJC, believed the owner had illegally rejected their purchase offer, and together with Aeon filed suit against the owner and the Village LLC. The residents and Aeon found themselves in a tough spot, however, because of a troublesome provision of the ROFR law. This provision appeared to provide that even if the owner violated the residents’ purchase rights, once the sale has been completed, it can’t be undone. Following several trial court rulings and a decision from the Minnesota Court of Appeals, the bottom line outcome was that the residents were unable to set aside the sale, though they did have available other remedies including damages should it be determined at trial that their purchase rights were violated. Unfortunately, none of these legal rulings came in time to prevent the scheduled park closing in the summer of 2017. In the Fall, the residents and Aeon negotiated a settlement of the lawsuit with the park seller and The Village LLC. Under the settlement defendants would make an initial payment of $150,000 to cover resident displacement costs, and the Village and Aeon would jointly approach the city of St. Anthony Village with a redevelopment proposal for a market rate apartment development on the site along with a separate 100 unit affordable development to be built and owner by Aeon and intended to replace the lost MH park. The settlement, however, fell apart when the City refused to approve the proposal. Although the City had originally invited a high density proposal from the Village, now the City had changed its tune, refusing to allow even a modest density increase, effectively making the development proposal infeasible. As of this writing, next steps are unclear. The Village and Aeon might have further discussions with the City about how to develop the site. Meanwhile, the residents have been scattered across the region and another affordable housing community in a good suburban location has been lost. HJC is still involved in attempting to achieve an outcome on the site that includes affordable housing. We are also working with partners to try to amend the ROFR law at the Legislature, and address many of the flaws in the law that were highlighted by this lawsuit. The complaint can be found here and the Court of Appeals ruling can be found here.