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HomeMy WebLinkAbout22-42 - ADMIN Resolution - Economic Development Authority - 2022/11/07 (2)EDA Resolution No. 22-42 Resolution approving a loan and a grant to St. Louis Park AH I, LLLP; authorizing the execution of documents in connection therewith; and taking other actions related thereto Be it resolved by the Board of Commissioners (the “Board”) of the St. Louis Park Economic Development Authority (the “Authority”) as follows: Section 1. Recitals. 1.01. To facilitate the development of certain property within the City of St. Louis Park, Minnesota (the “City”), the Authority, the City, and St. Louis Park AH I, LLLP, a Minnesota limited liability limited partnership (the “Developer”), entered into a Contract for Private Development, dated July 6, 2022 (the “Contract”), which provides for the construction by the Developer of an approximately 114-unit rental housing facility with approximately 117 underground parking stalls (the “Minimum Improvements”) on certain property legally described therein (the “Development Property”). 1.02. To provide financing for the Minimum Improvements, on July 6, 2022, the City provided a loan to the Developer from the City’s Affordable Housing Trust Fund in the principal amount not to exceed $850,000 (the “City AHTF Loan”). 1.03. To provide additional financing for the Minimum Improvements, on July 6, 20 22, the City issued its Multifamily Housing Revenue Note (Arbor House Apartments), Series 2022 (the “Series 2022 Note”), in the original aggregate principal amount of $27,990,550, and loaned the proceeds thereof to the Developer. The Series 2022 Note was purchased by Cedar Rapids Bank and Trust Company, an Iowa banking corporation (the “Senior Lender”). 1.04. Pursuant to the Contract, the Authority agreed to reimburse the Developer for certain qualified public development costs from tax increment revenue generated from property within the Wooddale Ave Apartments (Real Estate Equities) Tax Increment Financing District, a housing district within Redevelopment Project No. 1 in the City, to be evidenced by a Tax Increment Revenue Note (the “TIF Note”) to be issued in a principal amount not to exceed $940,000. 1.05. To provide additional financing for the Minimum Improvements, on the date hereof the City Council will consider a resolution authorizing the issuance of its Multifamily Housing Revenue Note (Arbor House Apartments), Series 2022B (the “Series 2022B Note,” and together with the Series 2022 Note, the “Senior Financing”), in the original aggregate principal amount of $1,000,000. The Senior Lender has agreed to purchase the Series 2022B Note. 1.06. In order to assist with the costs of the Minimum Improvements, the Authority, on behalf of the Developer, applied for and received a Tax Base Revitalization Account (TBRA) grant in the amount $184,300 (the “TBRA Grant”) from Metropolitan Council and an Environmental Response Grant in the amount of $184,325 (the “ERF Grant”) from the Environment and Energy Department of Hennepin County, Minnesota (the “County”). DocuSign Envelope ID: 91695294-2AA1-4E86-8FF2-F9554C99CF74 EDA Resolution No. 22-42 2 1.07. Metropolitan Council and the Authority entered into a Metropolitan Livable Communities Act Grant Agreement, effective as of October 20, 2022 (the “TBRA Grant Agreement”). Proceeds of the TBRA Grant may be used for eligible project components of the Minimum Improvements (the “TBRA Grant-Eligible Activities”) as described in the TBRA Grant Agreement. The Authority intends to loan the proceeds of the TBRA Grant (the “TBRA Loan”) to the Developer to provide financing for the TBRA Grant-Eligible Activities in accordance with a Loan Agreement (the “TBRA Loan Agreement”) between the Authority and the Developer. 1.08. The Authority and the County entered into an Environmental Response Fund Grant Agreement (Contract No. PR00004510) describing the use of the proceeds of the ERF Grant. The Authority intends to provide the ERF Grant to the Developer in accordance with a Sub-Grant Agreement (the “ERF Sub-Grant Agreement”) between the Authority and the Developer. 1.09. To provide the Senior Financing, the Senior Lender requires that (i) the City and the Authority subordinate their rights to, title to, and interest in the Development Property and the rights and the remedies and options of the City and the Authority under the Contract to those of the Senior Lender under the Senior Financing; (ii) the City agree to the subordination of the repayment obligations of the Developer with respect to the AHTF Loan to those of the Senior Financing; (iii) the City agree to the subordination of the repayment obligations of the Developer with respect to the TBRA Loan be subordinate to the obligations with respect to t he Senior Financing; and (iv) the Authority consent to the collateral assignment of the Developer’s interest in the TIF Note to the Senior Lender. 1.10. There have been presented before the Board forms of the following documents: (i) the TBRA Loan Agreement; (ii) a Promissory Note to be delivered by the Developer to the Authority to evidence the Developer’s repayment obligations with respect to the TBRA Loan; (iii) a Combination Mortgage and Security Agreement to be delivered by the Developer to the Authority to secure the Developer’s repayment obligations with respect to the TBRA Loan; (iv) the ERF Sub-Grant Agreement; (v) an Amended and Restated Master Subordination Agreement (the “Master Subordination Agreement”) between the Senior Lender, the City, an d the Authority, setting forth the terms of the subordination of the City’s and the Authority’s rights to, title to, and interest in the Development Property, the Contract, and the repayment obligations with respect to the AHTF Loan and the TBRA Loan; (vi) an Amended and Restated Collateral Assignment of Interest in Tax Increment Revenue Note (the “Collateral Assignment of TIF Note”) between the Developer and the Senior Lender and to be consented to by the Authority, pursuant to which the Developer will assign its interest in the TIF Note to the Senior Lender; and (vii) an Amended and Restated Master Loan Disbursement Agreement (the “Master Loan Disbursement Agreement”) between the Developer, the Senior Lender, the City, the Authority, and Guaranty Commercial Title, Inc., as disbursing agent, pursuant to which proceeds of the Senior Financing, the AHTF Loan, the TBRA Loan, the ERF Grant, and taxable loans provided by the Senior Lender to the Developer will be disbursed. Section 2. TBRA Loan and ERF Grant; Authority Documents. 2.01. The Board herby approves the TBRA Loan and the ERF Grant. DocuSign Envelope ID: 91695294-2AA1-4E86-8FF2-F9554C99CF74 EDA Resolution No. 22-42 3 2.02. The TBRA Loan Agreement, the ERF Sub-Grant Agreement, the Master Subordination Agreement, the Collateral Assignment of TIF Note, and the Master Loan Disbursement Agreement (collectively, the “Authority Documents”) are hereby approved in substantially the forms presented to the Board, together with any related documents necessary in connection therewith. 2.03. 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 Authority 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 Authority Documents shall be in substantially the forms on file with the Authority and the approval hereby given to the Authority Documents includes approval of such additional details therein 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 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 Authority Documents shall not be effective until the date of execution thereof as provided herein. 2.04. 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 on their behalf. Upon execution and delivery of the Authority 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 Authority Documents. Section 3. Effective Date. This resolution shall be effective upon approval. Reviewed for Administration: Adopted by the Economic Development Authority November 7, 2022 Karen Barton, executive director Margaret Rog, president Attest: Melissa Kennedy, secretary DocuSign Envelope ID: 91695294-2AA1-4E86-8FF2-F9554C99CF74