In Minnesota, common interest communities come in three forms:
A Planned Community, which is a series of lots that will have some governing documents that control how they can be used, conveyed, and developed.
A Condominium, which is a physical structure and a subdivision into pockets of air both vertically and horizontally so that each party purchases a small piece of a larger building.
A Co-Operative, which is a type of real estate development that generally doesn’t get sold as separate units.
Each of these types of common interest communities (or CIC) serves a very valuable purpose.
In the commercial real estate world the most common type is the condominium.
When developing a condominium under Minnesota law the governing statute is Chapter 515B. It’s important to know that the final condominium cannot be created until after the physical structure has been completed so that the appropriate boundary lines of the individual units can be determined.
When preparing a common interest community the governing document is a declaration, which includes a CIC plat. While the plat documents the division into units, the declaration creates various rights and obligations between the property owners and establishes a governing structure.
Typically, the governing structure is built around an Owners Association. The owner of a unit is a member of the association. The association can create additional rules and regulations for operation of the property as a whole. In addition, the association is responsible for day to day maintenance of common areas.