CC PACKET 11142006 - Laserfiche WebLink

Home Browse Search

FREERS & ASSOCIATES INC On December 19, 2003, the City and HRA entered into a Redevelopment Contract with Apache Redevelopment LLC. Pursuant to Section 10.1 of the Redevelopment Contract, the Developer was to begin construction of the Phase IB For Sale Housing Development by July 1, 2006 (condominium buildings #3 and #4). In addition, pursuant to Section 12.3 of the Redevelopment Contract, the City's Housing and Redevelopment Authority (HRA) was to provide the developer with a Pay -As -You -Go (PAYG) TIF Note in the amount of $3,432,758 to construct this phase of housing. Upon issuance of this Note, the developer would assign the PAYG TIF Note to their construction lender (just like they did in Phase IA) who in return would deposit this amount in the disbursement account for use in construction of the project. The developer is currently finishing up construction on condominium building #2 and anticipates beginning construction on building #3 in the summer of 2007 and building #4 by the summer of 2008. Therefore the developer has requested that the dates in the original Redevelopment Contract be amended to state that construction needs to commence by September 1, 2007 and September 1, 2008 for each building respectively. The delay in the construction of both buildings is only one year from what was originally projected as part of the sizing of the TIF Note ($3,432,758). Due to the increased value we are seeing at the project (higher sales prices than originally projected), this one year delay will not jeopardize or decrease the amount of TIF that will, be needed to satisfy the. required PAYG TIF Note ($3,9432,758). With regards to issuing the $3,432,758 PAYG TIF Note, the developer has requested that the Note be prorated accordingly between the two buildings and issued separately when construction of each building is ready to commence. By splitting the PAYG Note into two Notes it will assist the developer in obtaining better financing rates (due to less risk of constructing 64 units up front vs. getting financing commitments for 128 units) and will decrease carrying costs to the project (carrying a lower principal amount over a shorter period of time). If the note amount is prorated based upon the amount of increment generated by each building, the Phase IB — 1 Housing Note would be for $1,642,978 (building adjacent to 39t' Avenue) and the Phase IB — 2 Housing Note would be for $1,789,780 (building located on old Cadawallader property). Please contact me at 651-697-8506 with any questions. cc: File LEADERS IN PUBLIC FINANCE o.x2•c..�_.KAasF...tt u . .e <u-___..[�+-«_at<ct__..ceC�u�b_�a�__c<Su...t<�+_a.__.s_u _a_..._e«_.K<.�_.�;a: t�'-+_xs3: n.>-<-..�_ tfaw-:..:+t< c_�_tx.__y:._ ... _-�Ft.. S.c c C_ . < a.. s:._. _.._ ._. ..__ _ .,�h;ar<�Zr teYbxt� st: ilai•.Ac "'•'a__. t __. .._ ..v .. _ .. •„B:bt"�."• 3060 Centre Pointe Drive Phone: 651-697-8506 Fax: 651-697-8555 Roseville, MN 55113-1105 skvilvang@ehlers-inc.com W