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MEMORANDUM TO:Charlie Yunker, City Manager FROM:Jay R. Lindgren, City Attorney DATE:June 20, 2024 RE:Amendments to Doran Planned Unit Development Agreement and Ancillary Documents related to Doran’s Contract for Private Development Doran’s apartment project in Silver Lake Village was commenced pursuant to agreements with the City and HRA dated February 19, 2019. The agreements contemplated and approved a two-phase project and established Doran’s required escrow deposits. The first phase has been completed and Doran appropriately requests that the corresponding escrow deposits be returned. As was also contemplated (and is typical in development), the second phase will be developed by a separate legal entity, in part, for financing purposes. The Amendment to Planned Unit Development Agreement transfers the on-going escrow requirements to that second phase development entity and the City retains the security required for the second phase. This is a typical request in order to arrange second phase financing and have the second phase proceed. Also for financing purposes, Doran has requested that the City and HRA to execute the following documents. 1.First Amendment to Planned Unit Development Agreement – As described above, this document requires City Council approval and reestablishes the escrow amounts for the second phase. 2.Amended Subordination of Development Agreement – This document requires both City Council and HRA approval. When a project developer is arranging financing, the City and HRA typically subordinate certain of their rights in order for a mortgage lender to have a sufficient mortgage interest to allow lending to occur. The requested subordination is consistent with this market requirement and does not lessen the City’s or HRA’s interest beyond what was contemplated in the original agreements. 3.Memorandum of Unrecorded Agreements – This document requires both City Council and HRA approval. The original Contract for Private Development from 2019 among Doran, the City and the HRA has been amended three times since 2019 in the normal course of the project’s development. Such amendments are typically recorded against the property by the developer in order to give notice to the world that the development property is subject to the terms of the amendments. This has not been previously done. As part of the second phase financing, Doran would now like to acknowledge those amendments and has asked the City and HRA to do so by signing a memorandum identifying the amendments. It is in the best interest of the City and HRA to have these documents recorded and now is an appropriate time to do so. I recommend approval of all three documents. 62