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HomeMy WebLinkAbout25-37 - ADMIN Resolution - Economic Development Authority - 2025/12/15 EDA Resolution No. 25-37 Approving amendment contract for private development, with Beltline Apartments Limited Partnership and execution of documents relating thereto Be it resolved by the board of commissioners (the “board”) of the St. Louis Park Economic Development Authority as follows: Section 1. Recitals. 1.01. The authority and the city of St. Louis Park, Minnesota (the “city”) have heretofore approved the establishment of the Beltline Station Tax Increment Financing District No. 1 (the “TIF district”), a housing district within Redevelopment Project No. 1 (the “project”), and have adopted a tax increment financing plan for the purpose of financing certain improvements within the project. 1.02. The authority has heretofore created an Affordable Housing Trust Fund, which is funded in part with pooled tax increment derived from property within certain tax increment financing districts within the authority as provided in Laws of Minnesota 2022, First Special Session, Chapter 14, Article 9, Section 5. 1.03. To facilitate the development of certain property within the project and TIF district, the authority, the city, and Beltline Apartments Limited Partnership, a Minnesota limited partnership (the “developer”), have executed and delivered an amended and restated contract for private development (the “original agreement”) relating to the construction of approximately 82 units of affordable multifamily rental housing together with approximately 59 underground parking spaces (the “minimum improvements”) whereby the authority and the authority agreed to provide certain financial assistance to the minimum improvements. 1.04. Among other things, the agreement provides for the issuance by the authority of a tax increment revenue note to the developer in the maximum principal amount of $804,000 (the “TIF note”), authorizes the loan of proceeds of funds from the city’s affordable housing trust fund (the “city AHTF loan”) in the principal amount of $1,793,238 to the developer and sets forth certain other conditions for the construction of the affordable minimum improvements. The agreement also contemplates that the authority will use the proceeds of a grant in the amount $300,000 (the “SWCW grant”) for costs related to the minimum improvements, made by the County of Hennepin from the County’s Bottineau and Southwest Community Works Programs. In addition, the agreement requires that the developer comply with certain construction timelines for the affordable minimum improvements or pay a fee (the “affordable housing fee”). The payment of affordable housing fee will be secured by a letter of credit and a guaranty from George Sherman and Sherman Development Holdings (collectively, the “security”) delivered at closing on the property. 1.05. To allow the developer to perform certain obligations under the original agreement, cedar rapids bank and trust, an Iowa banking corporation, in its capacity as lender, together with any other permitted co-lenders and their respective successors and/or permitted Docusign Envelope ID: A7CB88DB-E53F-44FF-922A-A5D77219F0E7 assigns (collectively, “senior lender”), has agreed to provide the developer with financing by purchasing the tax-exempt conduit revenue obligations to be issued by the authority and providing taxable other taxable financing to the developer (collectively, the “senior financing”). 1.06. On Dec. 1, 2025, the council approved a first amendment to the amended and restated contract for private development to, among other items, update certain provisions to reflect the senior financing and requirements for disbursement of the AHTF loan. Since that date, the developer has requested that the city release a portion of the security for the affordable housing fee when it closes on its financing. 1.07. The authority, the city, and the developer have negotiated a revised first amendment to the amended and restated contract for private development (the “first amendment” and together with the original agreement, the “agreement”) to release a portion of the security for the affordable housing fee when the developer closes on its financing. 1.08. On Dec. 1, 2025, the council approved a master subordination agreement between the senior lender, the city, and the authority, and such other parties as may be required to the senior lender, pursuant to which the authority and the city will subordinate their right to, title to, and interest in the development property and the rights and the remedies and options of the city under the agreement to those of the senior lender and the senior financing. Since that date the senior has requested that the master subordination agreement be broken apart into two separate subordination agreements including (i) the swap master subordination agreement between the senior lender, the city, and the authority, and such other parties as may be required by the senior lender; and (ii) the master subordination agreement between the senior lender, the city, and the authority, and such other parties as may be required by the senior lender (collectively, the “subordination agreements”). Section 2. The first amendment and related documents. 2.01. The board hereby approves the first amendment and the subordination agreements in substantially the forms presented to the board, together with any related documents necessary in connection therewith, including all documents necessary for this transaction and including without limitation all documents, exhibits, certifications, or consents referenced in or attached to the first amendment, including without limitation the amended mortgage (all as defined in the first amendment) (the “development documents”). 2.02. The board hereby authorizes the president and executive director, in their discretion and at such time, if any, as they may deem appropriate, to execute the development documents on behalf of the authority, and to carry out, on behalf of the authority, the authority’s obligations thereunder when all conditions precedent thereto have been satisfied. The development documents shall be in substantially the form on file with the authority and the approval hereby given to the development documents includes approval of such additional details therein and such additional documents as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the authority and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the authority. The execution of any instrument Docusign Envelope ID: A7CB88DB-E53F-44FF-922A-A5D77219F0E7 by the appropriate officers of the authority herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. This resolution shall not constitute an offer and the development documents shall not be effective until the date of execution thereof as provided herein. 2.03. In the event of absence or disability of the officers, any of the documents authorized by this resolution to be executed may be executed without further act or authorization of the board by any duly designated acting official, or by such other officer or officers of the board as, in the opinion of the city attorney, may act in their behalf. Upon execution and delivery of the development documents, the officers and employees of the board are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the board to implement the development documents, including without limitation the issuance of tax increment revenue obligations thereunder when all conditions precedent thereto have been satisfied and reserving funds for the payment thereof in the applicable tax increment accounts. Section 4. Effective Date. This resolution shall be effective upon approval. Reviewed for administration: Adopted by the Economic Development Authority December 15, 2025: Karen Barton, executive director Sue Budd, president Attest: Melissa Kennedy, secretary Docusign Envelope ID: A7CB88DB-E53F-44FF-922A-A5D77219F0E7