Agenda Packets - 1994/04/25 - Laserfiche WebLink

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A J Page Three March 18, 1994 investment in the project, it is unlikely that it would permit the real estate taxes to remain unpaid. Under these conditions, the City is well insulated from an event of non-payment of real estate taxes. In order for the City to be exposed to such an incident, the following events would have to occur: a) The tenants would have to default on their lease obligations_and fail topaythe-real- estate--taxes. This is an extremely remote event given the credit worthy nature of the tenants in the project. b) The owner would then have to fail in payment of the real estate taxes which would jeopardize a significant investment in the project and invite a legal collection effort under the personal guaranty issued to the City covering this issue. c) The lender would have to refuse to pay the real estate taxes in the event the tenants and owner did not pay and jeopardize its investment in the project. Considering the chain of events which would have to occur before the City would be at risk, it is safe to say the event of risk of nonpayment is so remote that it has been virtually eliminated. As there is no longer any practical risk of nonpayment of taxes, we are asking the City to waive the remaining letter of credit requirement set forth in the contract for redevelopment of Mounds View Business Park South. Elimination of this requirement frees up the owner's ability to borrow funds necessary for further development of property in Mounds View and to recruit new tenants to the business park. We appreciate your consideration of this request and are prepared to discuss this further if you should have any questions. Please feel free to call me at any time. Sincerely, T EVE. . c 'OAP, LTD. Allan D. Anderson Vice-President of Finance Enclosures ADA/lc