For more than 35 years, Sunny and Pauline Kwan have gotten up early every morning to bake pineapple buns, egg tarts, fortune cookies and other Cantonese fare at Keefer Court Bakery & Cafe, the oldest Chinese bakery in the Twin Cities.

And for the past few weeks, Pauline Kwan has also been making mooncakes, the rich pastry that’s a special treat for the Mid-Autumn Festival that begins Monday. It’s the second-biggest holiday of the year for Chinese, the Thanksgiving holiday for Koreans and is celebrated as harvest time in many other Asian countries.

This year, the mooncakes, which symbolize prosperity and reunion for families, hold a special meaning for the Kwans: They will soon turn over the business to their daughter Michelle.

“I want to help her and do a smooth transition,” Sunny Kwan said. “After that, she can decide to expand the business or whatever she likes. She’s young and has a lot of ideas, just like me 40 years ago.”

The Kwans have been considering the change for a long time, at least since Michelle finished studies at the University of Minnesota a decade ago. They had allowed her to run the bakery on Sunday afternoons as early as when she was 13 years old. And when she gave her mom the schedule for winter breaks in high school, her mom declared that’s when she’d go on vacation and leave Michelle to run things.

“Growing up I just had in the back of my mind, I could see myself running this place. I thought this is probably what I’ll end up doing,” Michelle said.

But she first decided to spend a few years in China teaching English as a second language. And the fate of the Kwans’ other business, a fortune cookie bakery that supplied the Leeann Chin restaurant chain, Cub and Rainbow food stores and dozens of restaurants, had to be settled.

Building the business

Sunny Kwan left Hong Kong for Canada in 1973 and worked as an auto mechanic and a baker in a Chinese bakery. He followed his parents to Chicago in 1980 and then moved to Minneapolis because he had heard there were few fortune cookie makers here.

He bought a building on the corner of Cedar and Riverside avenues, a neighborhood of Vietnamese immigrants at the time, and opened Keefer Court in 1983, initially as a bakery and later a small restaurant. But his ambition lay in building a commercial bakery for fortune cookies.

By the mid-1990s, he had a separate fortune-cookie bakery on Lake Street and contracts that yielded more than $1 million in annual sales. In 1997, a crew from PBS’ “Mister Rogers’ Neighborhood” filmed the plant for a segment that showed how fortune cookies were made.

Meanwhile, Michelle and her three siblings grew up in the apartment above the original bakery and cafe. She helped in the community garden just down the block and they all watched as new immigrants from East Africa moved into the neighborhood.

The family’s sweets remained popular with the new residents. When she went to the U, Michelle decided to study African-American literature and youth studies in addition to Chinese language.

But when she finished college, she wasn’t ready to take over the family business, and her father said he was “a little disappointed” when she decided to teach abroad for a few years. “I worked so hard and I needed help,” he said. “A lot of kids, when they go out of the country, they won’t come back for many years. For me, it felt like a long time.”

After more than four years in China, Michelle said her father called. “He said ‘You’ve been gone for four years. Is that enough time?’ ” she said.

She returned, got a real estate license and started selling houses for some income. She also traveled around the U.S. and learned about trends in farming and food production with an eye to applying some ideas to the bakery.

“I started thinking up ideas of urban gardening and supporting the Hmong Farmers Association and building partnerships that way so we could be more locally sourced,” she said.

Preparing for transition

Meanwhile, cost pressures were growing on the fortune-cookie operation. Bigger competitors on the coasts were producing higher volumes at lower prices. “The competition was selling for less than what my costs were. I could not compete,” Sunny said. “And I was coming to retirement age.”

Two years ago, he sold the equipment in the Lake Street plant to a bakery in Oregon and returned to running the bakery and cafe in Cedar Riverside with his wife. Running the bigger fortune-cookie plant held little appeal to Michelle, she said, in part because it would have involved a lot of office work.

“I became a Realtor so I can be moving around and not have to sit at the office all day,” she said. “Here at the bakery, I’m constantly moving. I’m interacting with people face to face, whether the employees in the kitchen or people up front. I find that much more rewarding.”

The family hasn’t set a date for the final handoff of father-to-daughter control. And Pauline Kwan said she’s likely to keep helping out with the baking. Michelle has plans to market the business a bit more and tweak the menu a bit.

“I think we can really attract more local residents to explore a more diverse experience in pastries and also in Chinese food, or Asian food, really,” she said. “I’m not trying to do a fusion but I would love to incorporate more Asian pastries and food that is not commonly found here.”