05/05/2022 - Meeting Materials (2) MEETING OF THE
REDEVELOPMENT AGENCY FINANCE COMMITTEE
Thursday, May 5, 2022
9:00 a.m.
451 S State Street Room 126
Salt Lake City, UT 84111
The Redevelopment Agency (RDA) Finance Committee meeting will be a hybrid meeting which enables people to join
remotely or in-person to listen to the meeting and participate during public comment items.
To access and participate in the electronic meeting please visit
https://saltlakecity.webex.com/saltlakecity/j.php?MTID=m098e1 d699ebed3a664830b607a939e7d
Meeting Password: RqtExaUm472
Agenda
1. Roll Call
2. Approval of the minutes
NONE
3. Business
A. Discussion and Adoption of the RDA Finance Committee Bylaws—Acting Chair Danny Walz
The Committee will discuss and vote on the new RDA Finance Committee Bylaws.
B. Selection of Chair/Vice Chair for Calendar Year 2022—Acting Chair Danny Walz
The Committee will take a straw poll to nominate the Chair and Vice Chair of the Redevelopment Agency Finance
Committee for calendar year 2022. The process includes expressions of interest from Committee members and any
discussion the members wish to have regarding each nominee. The Committee will then vote for Chair and Vice
Chair.
C. Open and Public Meetings Act Training—Sara Montoya, Senior City Attorney
D. Bicycle Collective Loan Request—Tracy Tran, Project Manager
The Finance Committee will review a request for a$1,7500,000 commercial loan request for a new construction
development located at approximately 901 S Gale Street. The Finance Committee members will provide a
recommendation to the RDA Board.
E. West End Loan Extension -Kate Werrett&Tracy Tran, Project Managers
The Finance Committee will review a request for a 5-year term extension for an existing$3,100,000 commercial loan
for an adaptive reuse development located at approximately 740 West 900 South. The Finance Committee will
provide a recommendation to the RDA Board.
4. Adjournment
People with disabilities may make requests for reasonable accommodation no later than 48 hours in advance in order to
attend this Redevelopment Agency Finance Committee. Accommodations may include alternate formats, interpreters, and
other auxiliary aids. This is an accessible facility. For questions, requests, or additional information,please contact the RDA
at 801-535-7240.
BY-LAWS OF THE FINANCE COMMITTEE
OF THE REDEVELOPMENT AGENCY OF SALT LAKE CITY
ARTICLE I
NAME
The name of the body shall be the Finance Committee of the Redevelopment Agency of Salt
Lake City(hereinafter referred to as "Finance Committee").
ARTICLE II
PURPOSE
The purpose of the Finance Committee is to provide recommendations to the Board of
Directors ("Board") of the Redevelopment Agency of Salt Lake City("RDA") for approval
on all RDA loans, tax increment reimbursement agreements, and land write-downs.
ARTICLE III
MEMBERSHIP
The Finance Committee shall consist of not less than 5 of voting members and no more than
7 members. The Finance Committee shall consist of members who provide expertise in
finance, construction, law, architecture, urban design,planning, and any other expertise with
an emphasis on the finance of real estate development.
ARTICLE IV
CONFLICTS OF INTEREST
Finance Committee members are subject to Chapter 2.44 of Salt Lake City Corporation's
Ordinance regarding conflict of interest, and the Municipal Officers' and Employees' Ethics
Act in the Utah Code.
ARTICLE V
MEETINGS
The Finance Committee shall convene meetings on an as-needed basis,the frequency of which
shall be determined by the RDA staff based on when the Finance Committee must make
recommendations to the Board. Meetings may be requested by a majority of the Finance
Committee, the Finance Committee chair, RDA Director or the Executive Director.
Every Finance Committee meeting shall conform with the Utah Open and Public Meetings
Act. The Finance Committee may convene and conduct electronic meetings in accordance
with the Utah Open and Public Meetings Act.
A quorum is a majority of members who have been appointed to the Finance Committee.
Written minutes and a recording shall be taken of each Finance Committee meeting. Where
written minutes of a prior meeting are ready for Finance Committee approval, the Finance
Committee shall review and vote for approval of such meeting minutes at any subsequent
meeting.
ARTICLE VI
OFFICERS
The Finance Committee shall annually elect one of its members as chair and another member
as vice chair who shall perform the duties of the chair during the absence or disability of the
chair. The chair shall preside at all meetings and generally perform the duties of a presiding
officer.
ARTICLE VIII
AMENDMENTS
These By-Laws may be amended by three-fourths of the voting members present at any
regular Finance Committee meeting that has a quorum.
Passed by the Finance Committee of the Redevelopment Agency of Salt Lake City,
this day of May 5, 2022.
Acting Chairperson
tev SLCRDA
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RDA FINANCE COMMITTEE MEETING MEMORANDUM
Loan Request for The Bicycle Collective
Meeting: Thursday,May 5, 2022 9:00 AM— 11:00 AM, City and County Building, Room 126
DATE: April 29, 2022
TO: RDA Finance Committee
1. Redevelopment Advisory Committee: Claudia O'Grady
2. Economic Development: Peter Makowski
3. Finance: Mary Beth Thompson(or alternate Marina Scott)
4. Redevelopment Agency: Danny Walz
5. Community and Neighborhoods: Blake Thomas(or alternate Tammy Hunsaker)
6. Housing and Neighborhood Development: Tony Milner(or alternate Marion
Barnhill)
FROM: Tracy Tran,RDA Project Manager; 801-535-7241
RE: RDA Finance Committee Meeting—Funding recommendation for a$1,750,000 loan to
the Bicycle Collective to construct their nonprofit headquarters located at approximately
901 South Gale Street.
I. PROJECT OVERVIEW
The Bicycle Collective("Applicant"or"Organization"),a nonprofit organization,is requesting a
$1,750,000 bridge loan through the Redevelopment Agency of Salt Lake City's("RDA")Loan
Program for the construction of a new building located within the RDA's Granary District project
area at approximately 901 S Gale Street("Property"), as illustrated in Attachment A: Site Map.
The project will contain about 15,000 square feet for a multi-use building that will house the
retail,programming, and operations space for the Bicycle Collective.
The Applicant is seeking primary financing as a traditional bank loan would be cost-prohibitive
for the nonprofit organization. The RDA Loan Program Policy("Policy") allows the RDA to
provide primary financing if the project is an innovative RDA project which involves RDA-
owned property,is innovative in nature and financing is either unavailable or limited and cost-
prohibitive to the project.
The RDA currently owns the land. In November 2017,through a request for proposals("RFP")
process,the RDA selected the Bicycle Collective with which to negotiate the development of the
Property. In addition, in August 2018,the Board approved a land write-down for the property in
exchange for incorporating public benefits within the development. The project will include
public art,high quality façade materials and will be designed to at least a LEED Silver standard
of equivalent level.
II. APPLICANT INFORMATION
The mission of the Organization is to promote cycling effective and sustainable form of
transportation,recreation,and as a cornerstone of a cleaner, safer, and healthier society. The
Organization provides refurbished bicycles and educational program to the community,focusing
on children and lower income households. The Applicant is currently renting their current
workspace for their Salt Lake location within South Salt Lake City and they are outgrowing their
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space,which limits the number of activities that can take place on site. The requested loan would
help them build their headquarters on a property they would own and would provide a much
larger space for their programs and operations. The development team of the Property consists of
volunteers on the Applicant's Building Committee:
• Donna McAleer-Executive Director of the Bicycle Collective
• Sean Murphy—Chairman of the Board and Transit-Oriented Development Manager at
UTA
• Todd Reeder—Building Committee Chair and Director of Real Estate Development at
Community Development Corporation of Utah(CDCU).
• Chris Field—Project Manager and Owners Rep and Project Executive for Jacobsen
Construction
III. FUNDING REQUEST
The Applicant is requesting a$1,750,000 primary loan through the RDA Loan Program for the
Property. The applicant is seeking primary financing as a traditional bank loan would be cost-
prohibitive and would be difficult to obtain due to the additional risk involved with commercial
development and costs associated with the rehabilitation of old buildings.RDA policy allows the
RDA to provide primary financing if the project is an RDA-owned property,is innovative in
nature, and financing is either unavailable or limited and cost-prohibitive to the project. The
project meets four(4)of the public benefit criteria to qualify for primary financing through the
RDA Loan Program. The Applicant has provided documentation verifying that the Project's
ability to secure traditional financing is limited.
Pursuant to RDA Loan Program Policy("Policy"),the Project is eligible for a 5-year term with a
20-year amortization period. In addition,based on the Policy,the Project qualifies for a 3.66%
interest rate, calculated as follows:
RDA Loan Program Base Rate(U.S. Treasury Yield plus 3%) 5.66%
Public Benefit Interest Rate Reduction*:
• Public Amenities
• Transit Alternatives -0.5%
• Architecture and Urban Design -0.5%
• Sustainability -0.5%
-0.5%
Final Interest Rate**** 3.66%
*To be eligible for interest rate reductions, the project will be required to meet the criteria outlined in section
VI.
**The interest rate provided is an estimate. The final interest rate will be based on the U.S. Treasury Yield
Curve Rate, as determined by the term of the loan,at loan closing.
Refer to Attachment A:Loan Term Sheet for additional detail on proposed loan terms and
conditions.
IV. FINANCIAL OVERVIEW
Sources:
I RDA Loan $1,750,000 I 41%
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I Capital Development Campaign $1,970,000 I 46%
Equity $580,000 13%
Total Sources $4,300,000 100%
Uses:
Acquisition $280,000 7%
Soft Costs $378,533 9%
Hard Costs $3,452,356 80%
Contingency $189,111 4%
Total Uses $4,300,000 100%
V. POLICY ALIGNMENT: RDA LOAN PROGRAM
This loan request aligns with RDA Loan Program Policy("Program"),as adopted by the RDA
Board of Directors,with a clarification that although the loan amount is technically sized
appropriately(using debt service coverage ratio and/or loan to value calculations)as per the
Program,the projected repayment of the loan is based on the ability for the Applicant to
adequately fundraise to cover the loan balance at the end of the term. The reliance on this
fundraising to cover the loan makes this project riskier than others. The Applicant anticipates
receiving donations from large donors once the project construction is underway. The projections
show that the Applicant should be able to pay off their loan within the proposed 5-year term. The
Applicant has requested an interest rate reduction to acknowledge four public benefits provided
by the Project:
• Public Amenities: The Project is located along 9 Line Corridor that connects the east with
the west side neighborhoods. The Project will also include a public art amenity.
• Transit Alternatives: The mission of the Bicycle Collective is to promote cycling as an
effective and sustainable form of transportation. Additionally,the Project will include
employee shower and lockers.
• Architecture and Urban Design: The Project participated in an RDA design review
process that reviewed the buildings materials,how the project fits in the with surrounding
neighborhood, and how the project will enhance the public realm.
• Sustainability: The Project will be an all-electric building that will include rooftop solar
and the Project has been designed to a LEED-Silver equivalent standard. The Bicycle
Collective was also recently awarded a Blue Sky Grant from Rocky Mountain Power.
VI. POLICY ALIGNMENT: GRANARY DISTRICT REDEVELOPMENT PROJECT AREA
PLAN
The Project aligns with the RDA's goals for the neighborhood, as adopted through the Granary
District Redevelopment Project Area Plan, as follows:
• Commercial Objectives:
o Provide a broad mixture of small and medium commercial tenants representing a
variety of uses.
o Promote commercial development on a neighborhood scale with an emphasis on
specialty stores and neighborhood services.Neighborhood Revitalization: Return
underutilized land to a productive use through a reduction in the number of
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neglected buildings and vacant lots to reduce crime and improve the physical
environment of the neighborhood.
• Housing Objectives:
o Create attractive neighborhood environments that will reinforce the sense of
community.
o Require active, friendly and public-oriented ground-level uses that contribute to
the pedestrian environment and serve the neighborhood.
• Transportation Objectives:
o Pedestrian and Bicyclist Circulation: Provide access with an emphasis on a
friendly and safe environment for bicycles and pedestrians.
• Urban Design
o Create a pedestrian friendly streetscape that will establish a sense of
neighborhood.
VII. PROJECT VIABILITY&ABILITY TO REPAY THE LOAN
The loan repayment for this Project is based on fundraising. The project is projected to pay off the
loan through their capital campaign that will seek donations from individuals, organizations,and
foundations. The Applicant has raised a large portion of funds and anticipates additional
donations once the construction begins. These donations are expected to cover the debt service
for the loan.
VIII. PROPERTY OVERVIEW
The property is currently owned by the RDA and contains approximately.26 acres. Additionally,
the Property is currently vacant and is zoned D-2 (Downton Support)District.
IX. ATTACHMENTS
A. Loan Term Sheet
B. Site Map
C. Photos
D. Project Rendering
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ATTACHMENT A: RDA TERM SHEET
OPMEry,
RDALOAN LOAN TERM SHEET
Bicycle Collective
RDA LOAN PROGRAM
APPLICANT
Bicycle Collective("Applicant"), a nonprofit entity
ADDRESS
Property located at approximately 901 S Gale Street
PROPOSED LOAN TERMS
• Amount: $1,750,000
• Eligible Uses: Construction costs
• Interest Rate:
RDA Loan Program Base Rate(U.S. Treasury Yield plus 3%) 5.66%
Public Benefit Interest Rate Reduction:
• Public Amenities* -0.5%
• Transit Alternatives** -0.5%
• Architecture and Urban Design*** -0.5%
• Sustainability**** -0.5%
Final Interest Rate***** 3.66%
RDA staff will confirm the Project qualifies for the applicable interest rate reductions.Any changes to the
project could result in changes to the interest rate reductions:
*To be eligible for this interest rate reduction, the project will include a public art amenity
**To be eligible for this interest rate reduction, the project will be required to provide employee shower,
locker,and bicycle facilities as part of their overall development.
***The project participated and received approval through an RDA Design Review process.
****The project will be an all-electric building that will include rooftop solar and the Project has been
designed to a LEED-Silver equivalent standard.
*****The interest rate provided is an estimate. The final interest rate will be based on the U.S. Treasury
Yield Curve Rate,as determined by the term of the loan,at loan closing.
• Term: 5 years
• Amortization: 20 years
• Payments: Hard repayments with balloon payment due at the end of the term.
• Security: A first position lien on the property.
• Disbursement: Loan proceeds shall be disbursed through construction draws.
CONDITIONS FOR LOAN CLOSING
Prior to loan closing,the Applicant will complete the following:
• RDA approves all terms of the loan.
• Obtain all required City approvals.
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• Execute loan documents (e.g.promissory notes, loan agreements, security documents, and
guarantees) as deemed necessary by the RDA and its legal counsel.
• Receive approval from the RDA and its legal counsel of all matters pertaining to title,legality of
the loan,and the legality, sufficiency, and the form and substance of all documents that are
deemed reasonably necessary for the loan transaction.
• Provide evidence of insurance in such amounts and with such coverage as deemed necessary by
the RDA for the Property.
• Such other terms as recommended by the RDA's legal counsel and staff.
OTHER CONDITIONS
• The Project shall operate as the intended use over the term.
• The Project shall remain in good financial and legal standing over the term.
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RDA FINANCE COMMITTEE MEETING MEMORANDUM
Loan Amendment Request for West End Development(West End LLC)
Meeting: Wednesday,May 5, 2022 9:00 AM— 11:00 AM, City and County Building,Room 126
DATE: May 2,2022
TO: RDA Finance Committee
1. Redevelopment Advisory Committee: Claudia O'Grady
2. Economic Development: Peter Makowski
3. Finance: Mary Beth Thompson(or alternate Marina Scott)
4. Redevelopment Agency: Danny Walz
5. Community and Neighborhoods: Blake Thomas (or Tammy Hunsaker)
6. Housing and Neighborhood Development: Tony Milner(or alternate Marion
Barnhill)
FROM: Kate Werrett,RDA Project Manager; 801-535-6491
Tracy Tran,RDA Project Manager; 801-535-7241
RE: RDA Finance Committee Meeting—Loan term sheet amendment to existing commercial
loan for West End LLC for the adaptive reuse of two warehouses located at
approximately 740 West 900 South.
I. PROJECT OVERVIEW
The West End Development("Project"), located within the 9 Line Community Reinvestment
Area("9 Line CRA")at approximately 740 West 900 South("Property'),is an adaptive reuse
development that converted two existing warehouses into commercial uses. An RDA loan funded
the construction of the development improvements. The Project contains about 10,900 square feet
of rentable commercial space and a midblock connection with pedestrian improvements at about
750 West between Genesee Ave and 900 South. This commercial piece is the first phase of the
overall vision for this site. The second phase for this project will include a multifamily building
located to the east of the subject Project. This was the first 9 Line CRA project to receive RDA
assistance since the Project Area adoption in 2018.
Due to delays in construction and challenges finding tenants during the COVID pandemic,the
Applicant is requesting a five-year term extension to the RDA loan which is in place for the
commercial phase of the Project. Originally when the loan was approved in 2019,the Applicant
had anticipated construction to take approximately nine months and that occupancy and leasing
would begin in January 2021. The pandemic caused construction delays and due to the uncharted
economic climate,leasing the buildings has taken more time than anticipated. To improve tenant
interest,the Applicant recently reduced its proposed rents and has received a Letter of Intent
(LOI) for one of the two commercial buildings. The delay in rental income generation along with
a reduction in rental rates prompted this RDA loan term extension request.
If the five-year loan extension request is approved,the Applicant will move forward with reduced
rates for the commercial spaces.
II. APPLICANT INFORMATION
West End LLC("Applicant"), is a single-purpose entity of High Boy Ventures LLC("HBV").
HBV is a multi-investor real estate partnership that has received total capital commitments of
over$20 million to deploy into land purchases in Salt Lake City.Maximilian Coreth,manager of
HBV, is a founding member of Timberlane Partners,which has redeveloped properties within
Seattle, Salt Lake City,and Los Angeles. HBV has developed multifamily sites within Salt Lake
City, including The Morton, a 137-unit downtown structure.
III. LOAN AMENDMENT REQUEST
The Applicant is requesting that the existing primary loan through the RDA Loan Program have
its term extended five-years. RDA policy allows a standard loan term to be extended up to 10
years through a preauthorized extension. Pursuant to RDA Loan Program Policy("Policy"),the
Project is eligible to be preauthorized for an extension provided that the interest rate increases by
2%at the 5-year extension.Refer to Attachment A:Loan Term Sheet Amendment No. 1 for
additional detail on proposed loan terms and conditions.
IV. FINANCIAL OVERVIEW
In 2019,the RDA provided a$3,100,000 construction loan for the commercial phase of the
project. The commercial portion was completed in Fall 2021. The applicant has been making
payments on the loan in accordance with the existing term sheet.
V. POLICY ALIGNMENT: RDA LOAN PROGRAM
This loan amendment aligns with the RDA Loan Program Policy("Program"), as adopted by the
RDA Board of Directors,with no requested waivers or exceptions. The Term and Amortization
section of the Program states that while the standard loan term is up to 5 years,the overall loan
can be extended to 10 years through an extension preauthorization,provided that an interest rate
increase of 2%occurs at the 5-year extension. The standard 20-year amortization period was
applied to the initial loan and will continue with the extended term. Any balance at the end of the
term will be paid to the RDA with a balloon payment.
VI. POLICY ALIGNMENT: 9 LINE CRA PLAN
The Project continues to align with the RDA's goals for the neighborhood, as adopted through the
9 Line CRA Plan, as follows:
• Neighborhood Revitalization: Return underutilized land to a productive use through a
reduction in the number of neglected buildings and vacant lots to reduce crime and
improve the physical environment of the neighborhood.
• Catalytic Project: Identify catalytic project sites to target for redevelopment.Projects
must be sufficient in location and scope to encourage complimentary revitalization efforts
on surrounding properties.
• Adaptive Reuse: Incentivize the adaptive reuse of underutilized or economically
distressed buildings into a more productive use.
• Commercial Nodes and Corridors: Implement new and revitalized commercial space that
supports thriving stores and restaurants located at nodes connected by pedestrian-
friendly commercial corridors.
• Neighborhood Services: Encourage neighborhood-serving uses to increase access to fresh
food, day cares,and other services that promote health and well-being.
• Connectivity: Improve pedestrian safety,walkability,and neighborhood connectivity
through street and trail improvements,to include bicycle amenities,public transportation
enhancements,traffic calming, safety improvements,and streetscaping.
• Sustainability: Integrate sustainable design features and green infrastructure into projects
to mitigate impacts of new development and promote a resilient urban environment.
VII. PROJECT VIABILITY&ABILITY TO REPAY THE LOAN
The Applicant has demonstrated that the project will generate a positive cash flow once leased up
and will achieve the minimum coverage ratio as required by the Program Policy.While tenants
have not been confirmed,the Applicant has received interest from locally owned businesses.
VIII. PROPERTY OVERVIEW
The applicant currently owns approximately 1.8 acres that will include two phases of
development. The Phase 1 commercial piece includes approximately one acre. Phase 2 of this
project includes a residential multifamily building that will be constructed to the east. The current
zoning for the property is R-MU Residential/Mixed Use.
IX. ATTACHMENTS
A. Loan Term Sheet Amendment No. 1
B. Site Map
C. Site Photos
ATTACHMENT A: LOAN TERM SHEET AMENDMENT NO. 1
0 OPMEN,
RDALOAN
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RDA LOAN PROGRAM
LOAN TERM SHEET
Amendment No. 1
APPLICANT
West End LLC
ADDRESS
Approximately 740 West 900 South
PROJECT
The West End Development is a commercial development that will adaptively reuse and convert
two existing warehouses into commercial uses. The Project will include about 12,500 square feet
of commercial space and public space improvements.
PROPOSED LOAN TERMS
• Amount: The loan will be sized to the lower of$3,100,000 or a maximum of 90% of
value as per an as-completed appraisal.
• Interest Rate:
RDA Loan Program Base Rate (U.S. Treasury Yield plus
3%) 3.46%
Public Benefit Interest Rate Reduction:
• Adaptive Reuse -0.5%
• Public Amenities* -0.5%
• Economic Impact -0.5%
• Transit Alternatives** -0.5%
• Architecture and Urban Design*** -0.5%
0
• Sustainability**** -0.5%
Final Interest Rate (Years 1-5) 0.46%
Final Interest Rate (Years 6-10) ***** 2.46%
*To be eligible for this interest rate reduction, the project was required to provide public space and
improvements along the midblock alley.
**To be eligible for this interest rate reduction, the project was required to provide employee shower, locker,
and bicycle facilities as part of their overall development.
***To be eligible for this interest rate reduction,the project went through and received approval through an
RDA Design Review process.
****To be eligible for this interest rate reduction, the project was required to implement sustainability
features as approved by the RDA.
*****The option to extend the loan term requires an interest rate increase of 2%at the 5-year extension.
• Interest Accrual: Interest shall accrue during construction beginning upon the first
disbursement of funds.
• Term: 5 years, with preauthorized 5-year extension for a total preauthorized term of 10
years.
• Amortization: 20 years
• Disbursement: Loan proceeds shall be disbursed through construction draws. Any funds
not disbursed 24 months after closing will be used to pay all outstanding interest and
principal from the loan. To the extent that project sources exceed project uses at project
close out as documented by the cost certification.
• Expenses: Applicant will pay all loan expenses and closing costs, including title
insurance.
• Recourse: The loan shall be full recourse before project stabilization, converting to
nonrecourse upon project stabilization.
COLLATERAL AND GUARANTEES
• Personal Guarantee: Personal guarantee from Maximilian Coreth.
• Lien: A deed of trust lien, recorded in first position, on the Property.
CONDITIONS FOR LOAN CLOSING
Prior to the loan amendment closing, the Applicant will complete the following:
• RDA approves all amended terms of the loan.
• Obtain all required City approvals.
• Execute loan documents (e.g. promissory notes, loan agreements, security documents,
and guarantees) as deemed necessary by the RDA and its legal counsel.
• Receive approval from the RDA and its legal counsel of all matters pertaining to title,
legality of the loan, and the legality, sufficiency, and the form and substance of all
documents that are deemed reasonably necessary for the loan transaction.
• Provide evidence of insurance in such amounts and with such coverage as deemed
necessary by the RDA for the Property.
• Such other terms as recommended by the RDA's legal counsel and staff.
ATTACHMENT B: SITE MAP
GENESEE AVE
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ATTACHMENT C: SITE PHOTOS
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