Working Toward Expansion
We are currently working on two phases of our expansion project at Menomonie Market Food Co-op: the design development of the new building in Eau Claire and the financing of the overall project. The first part is fun, figuring out how long our cheese case will be, what new amenities we will offer, and how a customer will make their way through the store. We will wrap up this phase in the coming weeks because there are some building materials and pieces of equipment with incredibly long lead times right now, and we have to be sure to order everything on time!
The other major part of our expansion work is to secure financing. It’s a big deal to buy half a city block in downtown Eau Claire and build a building on top of it! We are a small company, unique because our ownership is diffuse and divided among almost 5,000 families. Traditional financing can be difficult since there isn’t one owner to guarantee the loan or corporate backing to guarantee the project. Some financial institutions need education on how co-ops are organized and resilient. Instead of a few wealthy shareholders putting up the equity, we are crowdsourcing it among our ownership by selling Preferred Shares. Almost 300 owners have received an investment packet, and 75 have made the commitment, together committing over $300,000 so far. Packets are rolling in, but if we are to meet our goal of $2 million, I estimate we need to get at least 300 more interested families to ask for the packet and consider an investment, small or large. If you want to be a part of Eau Claire finally getting the full-service co-op it has wanted for years, now is the time to come forward! Request a packet at mmfc.coop/expansion.
We are excited to share that we won two grants that were good matches, which brings over $200,000 more to our project. Throw in support from the City of Eau Claire, the savings the co-op has achieved through its hard work at both stores, and meeting our Preferred Shares goals, we hope to bring about 40% of the project cost to the table with the financial institution that will lend us the rest.
And we are in a good position there too; we have three area financial institutions who all have interest in being our lender. We are evaluating those options, asking a lot of questions, and exploring the different ways our debt can be organized. Many of you from our Menomonie location may know that for our 2015 expansion, our financing included something called New Markets Tax Credits. This is a federal program that offers tax credits to banks willing to invest in census tracts that are considered low income, low access, and food deserts. As this project site qualifies, we are looking into the possibilities of this complex but beneficial financing package for our project.
We will have the design development phase of the project wrapped up in the next few weeks, and with your help in purchasing Preferred Shares, we could have the financing wrapped up by the end of August. All of that work culminating properly will set us up well to have shovels in the ground before the snow flies.
This article was originally published in the July/August 2022 issue of our bi-monthly newsletter, The Morsel. If you’d like to read more stories like this one and stay up to date on the latest co-op news and events, pick up a print copy in-store on your next grocery run or find more news on our website here.
