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35 Mike Morrison Pratt Request to Change Phase IB Housing Development October 14, 2008 Page 2 and they were still confident they could meet the presale requirement to begin construction in the spring/summer of 2009. On October 2, 2008, the City sent Len Pratt a Notice of Default for Phase IB of Silver Lake Village (128 Condominium building). The default was due to Mr. Pratt not commencing with construction of this phase by September I, 2008 as required in the Development Agreeement. This notice was sent since the 7" Amendment has not yet been formally approved by the City Council and preserves the City's right to seek remedy under the current Development Agreement. In light of current market conditions and the inability for the Cooperative development to move forward this fall as originally anticipated, Mr. Pratt has requested that the City request an extension to the Fannie Mae loan on his behalf. As you may recall, a 1 -year extension was approved by Fannie Mae and the City last year, with final payment on the outstanding $2.6 million loan to be made by December 31, 2008. The repayment of this loam was to come from land sale proceeds from the Cooperative and the TIF revenue generated from the development. Since the development isn't anticipated to begin until next spring, Mr. Pratt is requesting another 1 -year extension. It should be noted that if the City and/or Fannie Mae does not agree to the extension, we will have to come back to the Council to discuss ramifications and options available to the City and Mr. Pratt under the Development Agreement. Attached to this memo are: 1. Silver Lake Village Sales and Availability Update 2. Site map of The Cottages town homes showing units sold to date 3. Listing of the 17 remaining units in the Condos at Silver Lake Village (113 sold to date); and 4. Site map showing locations of current committed parties to purchase a senior cooperative unit in Summerhill of St. Anthony I will overview the above information in more detail with you at the meeting on October 14, 2008. Len Pratt will be at the meeting as well to give the Council an update on the senior cooperative project, its feasibility and answer any questions the Council may have with regards to the entire Silver Lake Village development. Please contact me at 651-697-8506 with any questions or if you require further information.