Transmittal - 3/29/2023
SALT LAKE CITY CORPORATION
451 SOUTH STATE STREET, ROOM 118 WWW.SLC.GOV · WWW.SLCRDA.COM
P.O. BOX 145518, SALT LAKE CITY, UTAH 84114-5518 TEL 801-535-7240 · FAX 801-535-7245
MAYOR ERIN MENDENHALL
Executive Director
DANNY WALZ
Director
REDEVELOPMENT AGENCY of SALT LAKE CITY
STAFF MEMO
DATE: March 29, 2023
PREPARED BY: Tracy Tran, Senior Project Manager
RE: Proposed amendment to distribute funds in a lump sum at closing and
temporarily extend the lock in the base interest rate for the RDA loan to Bicycle
Collective
REQUESTED ACTION: Consider a request to disburse loan funds at closing and temporarily extend
the lock in the base interest rate to align with New Markets Tax Credit
requirements for the continued construction of the Bicycle Collective’s
nonprofit headquarters located at approximately 901 S Gale Street
POLICY ITEM: Granary Project area development.
BUDGET IMPACTS: Up to $2,250,000 from the revolving loan fund.
EXECUTIVE SUMMARY: The Bicycle Collective (“Applicant”), a nonprofit organization, received an
amendment to their loan approval in October 2022 from the RDA Board of Directors (“Board”) through
the Redevelopment Agency of Salt Lake City (“RDA”) Loan Program Policy for the construction of the
Applicant’s new headquarters located 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 (“Project”).
The loan approved by the RDA would help fill the Project’s financing gap as construction costs and
interest rates continue to rise. The Project began construction in January 2023 and the Applicant was able
to use fundraising resources through their capital campaign to start this construction while they waited to
close on the RDA loan. In the early years of planning for the project, the Applicant contemplated the use
of the New Markets Tax Credit (“Tax Credits”) for the Project, but opportunities for the Tax Credits did
not exist as the Project worked towards finalizing their sources of funds last year. As the Applicant
worked towards closing on the RDA loan, an opportunity arose for the Project to apply for the Tax
Credits early this year. The Project received a commitment for the Tax Credits on February 16, 2023,
which would provide a Tax Credits equity contribution of around $1,000,000 for the Project and would
provide for a reduction in the amount the Applicant would need to borrow through the RDA loan.
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The Tax Credits program is complex scheme with an intricate set of requirements. For the Applicant to
receive both the RDA loan and Tax Credits, the Applicant has requested certain modifications to the RDA
loan terms as detailed in this memo. Since the Tax Credits are based on specific geographic areas and
because the Bicycle Collective has other locations throughout Utah, to use the Tax Credits financing for
this Project, the program requires the Applicant to form a new legal entity specifically for this transaction
for a 7-year compliance period. While the new entity will be legally separate from the Applicant, the new
entity will nevertheless be controlled by the Applicant. The Applicant would lease the land for a nominal
amount to the new entity to receive the Tax Credits benefits and ensure completion of the construction.
The Applicant will make payments to the new entity (which will ultimately go back to the Applicant to
cover debt payments). The RDA’s security would be placed on the land and the improvements to be
constructed on the property. At the end of the compliance period and given all obligations have been met,
the Tax Credit structure would unwind and the new entity that was created would be taken out.
The structure for the Tax Credits require that the RDA loan be disbursed at closing as leverage for the
Tax Credits allocation. In addition, the Applicant is asking to extend the lock on the interest rate as it
expires April 11, 2023. The Applicant anticipates closing on the Tax Credits and RDA loan no later than
May 4, 2023 to meet the conditions for the Tax Credits.
BACKGROUND: In November 2017, the RDA offered the Property through a request for proposals
(“RFP”) process and selected the Bicycle Collective with which to negotiate for the development of the
Property. 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 be maintained as the headquarters
of the Bicycle Collective, a community serving non-profit, and include public art, high quality façade
materials and will be designed to at least a LEED Silver standard or equivalent level.
In May 2022, the RDA Board of Directors (“Board”) approved a $1,750,000 primary loan to the Bicycle
Collective. Due to construction cost increases and supply-chain issues that delayed the construction of
their development, the Applicant sought an additional $500,000 in primary financing, totaling $2,250,000
and requested to lock in their base interest rate for six months to help them manage costs, which the
Board approved in October 2022.
Since then, the RDA conveyed the Property to the Applicant in late 2022 and the Applicant used their
fundraising capital to start construction on the Property in January 2023. As the Applicant worked to
close on the RDA loan, an opportunity arose for the Tax Credits, which would allow for additional equity
in the Project and a reduction in the amount the Applicant would need to borrow from the RDA.
ANALYSIS & ISSUES: An overview of 1) Property details, 2) loan modification request, 3) RDA loan
program policy alignment, 4) Granary District project area alignment 5) proposed loan terms, 6)
capability for loan repayment, and 7) Applicant’s experience is as follows:
1. Property Details
The .26 acre property is currently owned by the Applicant (the land was transferred from the
RDA to the Applicant in November 2022). The Property is vacant and is zoned D-2 (Downtown
Support) District. However, during the seven-year Tax Credits compliance period, the Property
will be transferred to and owned by a new legal entity that will be majority controlled by the
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Applicant. Once the compliance period is complete, the Property will be transferred back to the
Applicant.
2. Loan Modification Request
The proposed changes to the loan request are summarized below:
• Under the current Board-approved loan terms, the RDA would have distributed the loan
through construction draws. However, the Tax Credits requires the RDA loan funds to be
disbursed in one lump sum at closing to leverage the funds required for the Tax Credits.
Both the funds raised by the Applicant through their capital campaign and the RDA loan
funds must be held in an investment fund under the newly created entity to leverage the
Tax Credits. To ensure oversight during construction, the RDA will receive reports from
a third-party consultant for each construction draw.
• Under the current Board-approved loan terms, the Applicant received a lock on the base
interest rate for six months, or until April 11, 2023. The Applicant is now requesting an
extension for the lock in the base interest rate to help them manage costs and to ensure
they are able to close by the May 4, 2023 deadline.
Though the RDA loan is anticipated to be reduced to about $1.4 million, RDA staff recommends
to maintain the original requested loan amount in case the Applicant is unable to close on the Tax
Credits financing before the expiration date. If for some reason, the Tax Credits portion of this
Project is unable to close, the previously amount approved for the RDA would help ensure the
Project is completed.
3. Policy Alignment: RDA Loan Program
This loan request aligns with RDA Loan Program Policy (“Program”), as adopted by the RDA
Board, except for the request to lock in an interest rate prior to closing (which required a waiver
from the Board) and 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 Program states that “the base interest rate shall be fixed at 300 basis points (3%) plus the US
Treasury Yield Curve Rate, as determined by the term of the loan, at loan closing.” Since the
request would lock in a rate prior to closing, this change required a waiver from the Board, which
was approved in October 2022. Locking in the interest rate would provide more certainty for the
Applicant to understand their repayment capacity in an environment of continuous rising interest
rates. Resolution R-14-2022 approved the interest rate lock for 6 months which expires on April
11, 2023. The Applicant would like to ensure the interest rate is locked at the same rate when
closing is anticipated to occur on the Tax Credits and RDA loan, which is anticipated to occur by
May 4, 2023.
In regards to loan disbursement, the Program states that “As established by administrative
policies and procedures, RDA staff shall ensure that each loan is services in accordance with
procedures used in prudent loan administration.” Since the Tax Credits will require disbursement
of the RDA loan at closing, RDA staff will require 3rd party construction draw reports to ensure
funds are adequate to complete construction.
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The reliance on fundraising to cover the loan made this project riskier than others. The Applicant
continues fundraising efforts to receive donations throughout construction. The Tax Credits
equity reduces the amount the Applicant would need to borrow from the RDA (from $2,250,000
to ~$1,400,000), which reduces the amount of debt service on the Applicant and decreases the
risk from the previous structure. 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 showers 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.
4. 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:
o 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.
• 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.
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5. Summary of Proposed Loan Terms
• Amount: With the Tax Credits, the loan amount will be sized up to $1,400,000. Without
New Markets Tax Credit (“Tax Credits”), the loan amount will be sized to the lower of
$2,250,000 or a maximum of a 90% of value as per an as-completed appraisal.
o Interest Rate:
RDA Loan Program Base Rate (U.S. Treasury Yield plus 3%) 5.66%*
Public Benefits Interest Rate Reduction**:
• Public Amenities
• Transit Alternatives
• Architecture and Urban Design
• Sustainability
-0.5%
-0.5%
-0.5%
-0.5%
Final Interest Rate*** 3.66%
*Base interest rate shall be locked at this 5.66%, as opposed to the rate at closing. This rate is
based on the U.S. Treasury Yield Curve Rate, as determined by the term of the loan.
**To be eligible for interest rate reductions, the project will be required to meet the criteria
outlined in section 3.
*** The final interest rate will be based on 5.66% base interest rate minus eligible interest rate
reductions.
• Term: 5 years.
• Amortization: 20 years.
• Lien: A first position lien on the property.
6. Loan Repayment
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 throughout construction. These donations are expected to cover the debt service for the
loan. The addition of the Tax Credits equity reduces the amount of debt needed for this project,
which reduces the risk of this loan.
7. Developer’s Experience
The development team consists of four members from the Applicant’s Building Committee with a
range of experience in executive, project, and construction management.
PREVIOUS BOARD ACTION:
• October 2022: The RDA Board approved an increase in the amount of the primary loan to
$2,250,000 to the Bicycle Collective and approved a base interest-rate lock. (R-14-2022)
• May 2022: The RDA Board approved a $1,750,000 primary loan to the Bicycle Collective for
construction of the Project. (R-6-2022)
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• August 2018: The RDA Board approved a land write-down for the property in exchange for
incorporating public benefits within the development (R-28-2018).
ATTACHMENTS:
A. Site Map
B. Site Photos
C. Project Renderings
D. Term Sheet
E. Resolution from October 2022 (R-14-2022)
F. Resolution
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ATTACHMENT A: SITE MAP
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ATTACHMENT B: SITE PHOTOS
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ATTACHMENT C: PROJECT RENDERINGS & ELEVATIONS
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10
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ATTACHMENT D: TERM SHEET
APPLICANT
Bicycle Collective (“Applicant”), a nonprofit entity
ADDRESS
Property located at approximately 901 S Gale Street
PROPOSED LOAN TERMS
• Amount
o With New Markets Tax Credit: loan amount will be sized up to $1,400,000
o Without New Markets Tax Credit: $2,250,000
• 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**
• Transit Alternatives***
• Architecture and Urban Design****
• Sustainability*****
-0.5%
-0.5%
-0.5%
-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:
* Base interest rate shall be locked at this 5.66%, as opposed to the rate at closing. This rate is based on the
U.S. Treasury Yield Curve Rate, as determined by the term of the loan, and shall be valid for 3 months.
**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 final interest rate will be based on 5.66% base interest rate minus eligible interest rate
reductions.
• Term: 5 years
• Amortization: 20 years
LOAN TERM SHEET
Bicycle Collective
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• Payments: Hard repayments with balloon payment due at the end of the term.
• Security: A first position lien on the property.
• Disbursement: With New Market Tax Credits, Loan proceeds shall be disbursed at closing.
Without New Market Tax Credits, 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.
• 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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ATTACHMENT E: RESOLUTION FROM OCTOBER 2022 (R-14-2022)
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REDEVELOPMENT AGENCY OF SALT LAKE CITY
RESOLUTION NO. -------
Amending Loan Terms and Approving an Exception to the Loan Policy
for a Loan to Bicycle Collective
RESOLUTION OF THE BOARD OF DIRECTORS OF THE REDEVELOPMENT AGENCY
OF SALT LAKE CITY APPROVING AN AMENDED TERM SHEET AND AN EXCEPTION
TO THE LOAN POLICY FOR A LOAN TO THE BICYCLE COLLECTIVE FOR A
COMMERCIAL DEVELOPMENT PROJECT LOCATED AT APPROXIMATELY 901
SOUTH GALE STREET
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 RDA has a revolving loan fund to provide construction loans for projects
located in its project areas that it manages in accordance with the RDA Loan Program Policy
Policy").
WHEREAS, the Policy provides that the base interest rate for loans will be set at the
closing of the loan.
WHEREAS, on May 10, 2022, in accordance with the Policy, the RDA Board of Directors
the "Board") approved resolution R-6-2022 allocating the funding and approving terms of a loan
in the amount of $1,750,000 to Bicycle Collective, a Utah nonprofit entity (the "Developer"), in
connection with the a commercial development to house its headquarters (the "Project") on the
property consisting of approximately 0.26 acres located at approximately 901 South Gale Street.
WHEREAS, the Developer has requested to increase the loan amount to $2,250,000 and
requested an exception to the Policy to set the base interest rate as the rate of 5.66% as reflected
in Exhibit A: Term Sheet.
WHEREAS, on September 21, 2022, the RDA Finance Committee ("Committee")
reviewed Developer's requested changes to the loan terms and interest rate exception.
WHEREAS, based on the Committee's recommendations, the RDA staff recommends the
Board approve the attached amended set of terms (the "Term Sheet") forthe loan to the Developer,
as borrower, for the Project. Additionally, the RDA staff recommends approving an exception to
the Policy to set the base interest rate at the rate stated in the Term Sheet and such exception shall
be valid for six months from the date of this resolution.
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 waiver of the Policy to set the base interest rate at the
rate stated on the Term Sheet, which waiver shall be valid for six months from the date of this
14 of 2022
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resolution. 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'soffice.
Passed by the Board of Directors of the Redevelopment Agency of Salt Lake City, this
day of October, 2022.
Ana Valdemoros, Chair
Approved as to form: --',,._=----_ ____,_,:::.._ _________ _
Salt Lake City Attorney'sOffice
Allison Parks
Date: September 23, 2022
The Executive Director:
does not request reconsideration
requests reconsideration at the next regular Agency meeting.
Erin Mendenhall, Executive Director
Attest:
City Recorder
11th
Allison Parks (Oct 12, 2022 14:29 MDT)
Oct 12, 2022
Ana Valdemoros (Oct 15, 2022 14:42 MDT)
Erin Mendenhall (Oct 20, 2022 10:42 MDT)
4
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EXHIBIT A: LOAN TERM SHEET
APPLICANT
Bicycle Collective (“Applicant”), a nonprofit entity
ADDRESS
Property located at approximately 901 S Gale Street
PROPOSED LOAN TERMS
Amount: $2,250,000
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**
Transit Alternatives***
Architecture and Urban Design****
Sustainability*****
0.5%
0.5%
0.5%
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:
Base interest rate shall be locked at this 5.66%, as opposed to the rate at closing. This rate is based on the
U.S. Treasury Yield Curve Rate, as determined by the term of the loan, and shall be valid for 6 months.
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 final interest rate will be based on 5.66% base interest minus eligible interest rate reductions.
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.
LOAN TERM SHEET
Bicycle Collective -RDA LOAN
RDA LOAN PROGRAM
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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.
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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ATTACHMENT F: RESOLUTION
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REDEVELOPMENT AGENCY OF SALT LAKE CITY
RESOLUTION NO. _______________
Amending and Restating Loan Terms and Extending a Limited Waiver of the Loan Policy
for a Loan to the Bicycle Collective
RESOLUTION OF THE BOARD OF DIRECTORS OF THE REDEVELOPMENT AGENCY
OF SALT LAKE CITY APPROVING AN AMENDED AND RESTATED TERM SHEET
AND EXTENDING A LIMITED WAIVER TO THE LOAN POLICY FOR A LOAN TO THE
BICYCLE COLLECTIVE FOR A COMMERCIAL DEVELOPMENT PROJECT LOCATED
AT APPROXIMATELY 901 SOUTH GALE STREET
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 RDA has a revolving loan fund to provide construction loans for projects
located in its project areas that it manages in accordance with the RDA Loan Program Policy
(Policy), which provides that the base interest rate for loans will be set at the closing of the loan.
WHEREAS, on May 10, 2022, in accordance with the Policy, the RDA Board of Directors
(Board) approved resolution R-6-2022 allocating the funding and approving terms of a loan in the
amount of $1,750,000 to the Bicycle Collective, a Utah nonprofit entity (the Developer), in
connection with the a commercial development to house its headquarters (the Project) on the
property consisting of approximately 0.26 acres located at approximately 901 South Gale Street in
the RDA’s Granary Project Area.
WHEREAS, on October 11, 2022, in accordance with the Policy, the Board approved
resolution R-14-2022 modifying the terms of the originally approved loan to increase the amount
of the loan to $2,250,000 and waive a portion of the Policy to lock in the base interest rate of 5.66%
for six months.
WHEREAS, due to Developer’s receipt of financing through New Markets Tax Credits,
the Developer has again requested modifications to the loan terms to modify how the loan is
distributed and extend the limited waiver of the Policy to lock in the base interest rate of 5.66%
for another three months as reflected in Exhibit A: Amended and Restated Term Sheet.
WHEREAS, the RDA Finance Committee (Committee) reviewed Developer’s requested
changes to the loan terms and interest rate waiver and had no concerns.
WHEREAS, based on the Committee’s input, the RDA staff recommends the Board
approve the attached amended and restated set of terms for the loan to the Developer, as borrower,
for the Project. Additionally, the RDA staff recommends approving a limited waiver of the Policy
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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 Amended and
Restated Term Sheet attached hereto, subject to revisions that do not materially affect the rights
and obligations of the RDA hereunder. The Board authorizes the waiver of the Policy to set the
base interest rate at the rate stated on the Term Sheet, which waiver shall be valid for three
months from the date of this resolution. The Board authorizes the Executive Director to negotiate
and execute the loan agreement and any other relevant documents consistent with the Amended
and Restated Term Sheet, and incorporating such other terms and agreements as recommended
by the City Attorney’s office.
Passed by the Board of Directors of the Redevelopment Agency of Salt Lake City, this
_day of April, 2023.
_________________________________
Alejandro Puy, Chair
Approved as to form: __________________________________
Salt Lake City Attorney’s Office
Allison Parks
Date:____________________________
The Executive Director:
____ does not request reconsideration
____ requests reconsideration at the next regular Agency meeting.
________________________________
Erin Mendenhall, Executive Director
Attest:
_______________________
City Recorder
March 29, 2023
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EXHIBIT A: AMENDED AND RESTATED LOAN TERM SHEET
APPLICANT
Bicycle Collective (“Applicant”), a nonprofit entity
ADDRESS
Property located at approximately 901 S Gale Street
PROPOSED LOAN TERMS
• Amount
o With New Markets Tax Credit: loan amount will be sized up to $1,400,000
o Without New Markets Tax Credit: $2,250,000
• 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**
• Transit Alternatives***
• Architecture and Urban Design****
• Sustainability*****
-0.5%
-0.5%
-0.5%
-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:
* Base interest rate shall be locked at this 5.66%, as opposed to the rate at closing. This rate is based on the
U.S. Treasury Yield Curve Rate, as determined by the term of the loan, and shall be valid for 3 months.
**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 final interest rate will be based on 5.66% base interest rate minus eligible interest rate
reductions.
• Term: 5 years
• Amortization: 20 years
LOAN TERM SHEET
Bicycle Collective
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• Payments: Hard repayments with balloon payment due at the end of the term.
• Security: A first position lien on the property.
• Disbursement: With New Market Tax Credits, Loan proceeds shall be disbursed at closing.
Without New Market Tax Credits, 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.
• 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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