Loading...
Proposed Resolution - 5/10/2022ATTACHMENT C REDEVELOPMENT AGENCY OF SALT LAKE CITY RESOLUTION NO. ------- Term Sheet Amendment No. 1 for Loan to West End LLC RESOLUTION OF THE BOARD OF DIRECTORS OF THE REDEVELOPMENT AGENCY OF SALT LAKE CITY A PPROVING A FIRST AMENDED TERM SHEET FOR A LOAN TO WEST END LLC FOR A COMMERCIAL DEVELOPMENT PROJECT LOCATED AT APPROXIMATELY 740 WEST 900 SOUTH WHEREAS, the Redevelopment Agency of Salt Lake City ("RDA") was created to transact the busine ss and exe rcis e the powers provided for in the Utah Community Reinvestment Agency Act (the "Act"). WHEREAS, on October 10, 2019, in accordance with the RDA Loan Program (the "Program"), the RDA Board of Directors (the "Board") approved Resolution R-19-2019 allocating the fundin g a nd approving preliminary terms of a lo an to West End LLC , a Utah limited liability company (the "Deve loper") in connection with a commercial developm ent called West End Development which includes the adaptive reuse of two warehouses (the "Proj ect") on approximately one acre of property located at approximately 740 West 900 South (the "Property"). WHEREAS, the Program permits an extension of the overall loan term from the standard five (5) year term to a maximum often (10) years through a preauthorized l oan extension, provided that the interest rate increases by 2% during the extension. WHEREAS, the Developer h as re quested preauthorization to extend the lo an term to 10 years, with the requisite 2 % interest rate increase for the final 5 years of th e term, in accordance w ith the Program. WHEREAS, on May 5, 2022, the RDA Finance Committee r eviewed a proposed a mendment t o the lo an terms previo us ly approve d by the Board. WHEREAS, based on the RDA Finance Committee 's r ecommendations, the RDA staff recommends the attached set of amended terms (th e "Ame nded Term Sheet ") for the Proj ect loan to the Developer, as borrower, for the Project. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Redev elopment Agency of Salt Lake City that it approves the terms outlined in the Amended Term Sheet attached hereto, subject to revisions that do not materially affe ct the rights and obli gations of the RDA hereunder. The Board authorizes the Execut ive Director to negotiate and execute the loan agreement and any other r ele vant do cuments consist ent w ith the Amended T erm Sheet, and incorporating such other terms and agreements as recommended by the City Attorne y 's office . Passed by the Board of Directors of the Redevelopment Agency of Salt Lake City, this __ day of _______ , 2022. Ana V aldemoros, Chair Approved as to form: :5tVl.4,, /'J't,;etor Salt Lake City Attorney's Office Sara Montoya Date: Apri l 22, 2022 The Executive Director: __ does not request reconsideration __ requests re consideration at the next regular Agency meeting. Erin Mendenhall, Executive Director Attest: City Recorder 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 • Public Amenities* • Economic Impact • Transit Alternatives** • Architecture and Urban Design*** • Sustainability**** -0.5% -0.5% -0.5% -0.5% -0.5% -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 a 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 loan closing, the Applicant will complete the following: • RDA approves all 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.