What is a Co-Op?

A housing cooperative, or co-op, is a legal term for a housing unit that is owned and controlled jointly by a group of individuals who have equal shares, membership and occupancy rights to the housing. Co-ops are popular on the east coast but there are only three housing cooperatives in Missouri. “When you buy into a co-op, you become a shareholder in a corporation that owns the property. As a shareholder, you are entitled to exclusive use of a housing unit in the property,” says Lisa Smith from Investopedia. Rather than owning a single unit as in a condominium, shareholders are part-owners of the entire building, owning a share of stock that carries with it the right to lease from the corporation a designated apartment and the obligation to pay a proportional share of the operation, and maintenance and improvement costs of the building as well as the interior costs of the owners’ unit properly allocated to that apartment. The lease is the same for everyone in the building and spells out the rights and obligations of all shareholders.

Who’s in charge of a co-op?

You are, along with your fellow residents! As a shareholder, you influence how the building operates. You elect a board from among your fellow shareholders. You attend meetings and vote on decisions. This includes shaping rules and regulations for how the building is managed, how funds are spent, and who is eligible for consideration to join the co-op.

What are the benefits?

One benefit is the cost. Cooperative housing can cost less than owning a condo. “Co-ops tend to be cheaper per square foot. They typically offer buyers more control as an individual shareholder and often have lower closing costs,” says Lester Davis from the Washington Post.

Cooperatives also have lower real estate taxes. Co-ops get a single tax bill based on the value of the building, with that amount divided equally among shareholders. In contrast, condos are assessed on the perceived value of each unit, with value determined by comparing unit sales. The per unit cost in 2021 was $3,490.71. The same tax laws for real estate tax deductibility apply.

And one more perk to co-op living is community. This special living situation gives you more than just somewhere to live - you get a whole community. You more often than not know your neighbors, have a network of people watching out for you and your home and connect with people you can rely on when you’re out of town, in need of assistance - or just for fun!

What’s the process to buy?

Purchasing a share of this co-op corporation, which includes the right to reside in your apartment, requires an in-person board interview and financial review process. Potential shareholders must provide summary tax returns and a net worth and income statement to ensure financial protection of fellow shareholders. Additional information can be obtained through your real estate professional. The St. Regis does not discriminate based on race, color, national origin, religion, sex, sexual orientation, familial status or disability.

What about financing?

Because co-ops are rare in the Midwest, not every mortgage lender will finance the purchase - but there are several that will. Just as a financial institution lends money with a deed as security, lenders with an understanding of co-ops can make loans with a stock certificate as security. And under the current tax laws, the interest you pay on that loan is deductible, the same as it would be on a house or condo mortgage.

The St. Regis does require that the amount of the loan not exceed 80% of the appraised value of the apartment. Checking with your financial institution to see if they will finance co-ops is a recommended first step. Listed below are a list of lenders that have recently offered loans to St. Regis shareholders:

Lindell Bank and Trust

Gorman and Gorman Home Mortgage

Busey Bank

What are the fees?

The inclusive monthly fee covers 24-hour security, lawn care, landscaping, snow removal, common area maintenance, water, sewer and trash removal, resident and guest parking. It also includes real estate taxes, building insurance and recent capital improvements (new passenger elevators, updated plumbing and tuckpointing of the entire building).

Monthly Fees (as of January 2025):