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R-001-2019 - Amendment of Loan to Ribbon Properties LLC; 525 South 500 West R 19-2 REDEVELOPMENT AGENCY OF SALT LAKE CITY R-1-2019 RESOLUTION NO. Amendment of Loan to Ribbon Properties LLC RESOLUTION OF THE BOARD OF DIRECTORS OF THE REDEVELOPMENT AGENCY OF SALT LAKE CITY APPROVING THE TERM SHEET FOR THE AMENDED LOAN TO RIBBON PROPERTIES LLC FOR A PERMANENT SUPPORTIVE HOUSING PROJECT LOCATED AT 525 SOUTH 500 WEST. WHEREAS, the Redevelopment Agency of Salt Lake City("RDA")was created to transact the business and exercise the powers provided for in the Utah Community Reinvestment Agency Act. WHEREAS, the Act provides that tax increment funds may be used outside of a project area for the purpose of increasing the affordable housing supply within the boundaries of Salt Lake City. WHEREAS, the RDA may loan tax increment funds through its revolving loan fund (the "RDA Loan Fund"). WHEREAS, on June 30, 2017, the RDA provided a loan to Ribbon Properties LLC, a Utah limited liability company(the"Developer")in the amount of Five Hundred Thousand Dollars ($500,000) for the acquisition of real property located at 525 South 500 West("Property"). WHEREAS,the Developer has applied to the RDA for an amendment to its existing loan to facilitate the long-term financing of the development of a permanent supportive housing located on the Property that combines affordable housing with supportive services to comprehensively address the needs of homeless individuals project(the "Project"). WHEREAS, when completed,the Project, to be known as"Pamela's Place,"will include 100 residential units,targeted to 30%of the area median income("AMI")and below,with 4,000 square feet dedicated to supportive service uses. WHEREAS, on January 23, 2019, the RDA Finance Committee reviewed the loan application. WHEREAS, based on the RDA Finance Committee's recommendations, the RDA staff recommends the attached set of terms to amend the loan to the Developer, as borrower, for the Project("Term Sheet"). NOW, THEREFORE,BE IT RESOLVED by the Board of Directors of the Redevelopment Agency of Salt Lake City that it approves the loan outlined in the Term Sheet attached hereto, subject to revisions that do not materially affect the rights and obligations of the RDA hereunder. The Board authorizes the Executive Director to negotiate and execute the loan agreement and any other relevant documents consistent with the Term Sheet, and incorporating such other terms and agreements as recommended by the City Attorney's office. Passed by the Board of Directorlofthn Redevelopment A ency of Salt Lake City, this 12th day of February , 2019. Amy F er, Chair Approved as to form: lwat7 VINLakebty Attorney's Office Kimbeyly K. Chytraus Date. 23 L The Executive Director: does not request reconsideration requests reconsideration at the next regular Agency meeting. Jacqueli e M. Biskupski, Executive Director N000,, -V5-y P M ENT9GZ est: 4' PORgTF �2� SEAL o y City Recorder Date: Z0-11� HB_ATTY-#75246-v I-RDA_Resolution_Ribbon_Properties_Loan_Amendment LOAN TERM SHEET SITE ACQUISTION LOAN(Existing) • On June 30,2017,the RDA and Developer closed on a$500,000 site acquisition loan with a 24- month term,2.32%interest rate, and principal and interest due at loan maturity. LOAN MODIFICATION TERMS • Assignment by Developer(Borrower): The Developer is a Utah limited liability company, whose sole member is Housing Assistance Management Enterprise, a Utah nonprofit corporation("HAME"). Due to requirements by the senior lender,Developer may transfer the Loan to HAME so that HAME will be the Borrower. • Amount: The$518,367 site acquisition loan and capitalized interest shall convert to a long- term loan that shall be forgiven if all conditions listed below are met. • Term: 20 years. Should a transfer or refinance occur prior to the end of the term,the RDA shall reserve the right to administratively approve loan forgiveness prior to the end of the term. • Interest Rate: 2.32%beginning accrual at loan modification.No interest if all conditions are met. • Repayment: Balloon payment at expiration of term.No payments if all conditions are met. RIGHT OF FIRST REFUSAL • The RDA shall hold the right of first refusal if in the event that during the course of the loan: o The land use restrictive agreement(LURA)is removed, or o The property is no longer operated as permanent supportive housing, or o The property is sold to anyone other than HAME or its affiliates. CONDITIONS • The Project shall be constructed and operated as intended over the term. • The Project shall remain in good financial and legal standing over the term. COLLATERAL AND GUARANTEES • A deed of trust,which may be subordinated to last position,on the property located at 525 South 500 West. APPLICATIONS FOR OTHER SOURCES OF FUNDING • Ribbon Properties will seek funding from the Utah Housing Corporation, Federal Home Loan Bank, and other sources as agreed upon by RDA staff and the Developer. In the event that additional funding is secured and able to be utilized as a source of financing, Ribbon Properties will repay the RDA loan on a proportionate basis of funding secured,up to $500,000. CONDITIONS FOR LOAN AMENDMENT • RDA approves all terms of the loan. • Secure sufficient sources of project financing. • Obtain all required City approvals. • Execute loan documents(e.g. promissory notes, loan agreement, deed of trust) 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.