HomeMy WebLinkAboutR-98-0137J-98-108
1 /20/98
RESOLUTION NO. 9 8 - 137
A RESOLUTION, WITH ATTACHMENT(S), AUTHORIZING THE
CITY MANAGER TO EXECUTE A SUBORDINATION
AGREEMENT, IN A FORM ACCEPTABLE TO THE CITY
ATTORNEY, IN CONNECTION WITH THE PENDING
REFINANCING OF A 5-UNIT MIXED -USE HOUSING PROJECT,
LOCATED AT 3659 GRAND AVENUE, COCONUT GROVE,
FLORIDA, FOR THE PURPOSES OF RENOVATING SAID
UNITS, BY THE COCONUT GROVE LOCAL DEVELOPMENT
CORPORATION, INC. ("CGLDC"), THEREBY SUBORDINATING
THE CITY'S EXISTING SECOND MORTGAGE (HOME MULTI-
FAMILY REHABILITATION LOAN PROGRAM) IN THE AMOUNT
OF $120,000.00 TO A NEW FIRST MORTGAGE WITH THE
STATE OF FLORIDA, UNDER THE STATE'S AFFORDABLE
HOUSING LOAN PROGRAM IN THE AMOUNT OF
$250,000.00 FOR THE AFOREMENTIONED PURPOSE.
WHEREAS, the City of Miami, through the HOME Investment Partnership Program
(HOME), funded by the U.S. Department of Housing and Urban Development, has
implemented the HOME Multi -Family Rehabilitation Loan Program (the "Program") for the
purpose of providing financial assistance to owners of substandard apartment buildings
consisting of five (5) or more dwelling units; and
WHEREAS, through the Program, the City of Miami makes available deferred
payment loans to property owners, which allows the City to forgive a percentage of the
loan over a five (5) to ten (10) year period, on an annual basis, as long as the project
remains in full compliance with the HOME Program requirements; and
ATTACHMENTS)
. CONTAINED
N •�, 1Ti ,�, •
FEB 10 1998
PkmohtAm No.
- 137
WHEREAS, in December, 1996, the Coconut Grove Local Development Corporation,
Inc. (CGLDC) received a loan in the amount of $120,000.00 under the City's HOME Multi -
Family Rehabilitation Loan Program in connection with the rehabilitation of a 5-unit mixed -
use housing project at 3659 Grant Avenue; and
WHEREAS, in October, 1997, Mr. David Alexander, Executive director of the
CGLDC, requested that the City subordinate its existing second mortgage loan, in the
amount of $120,000.00, to a new first mortgage loan, in the amount of $250,000.00,
from the State of Florida, for the purpose of renovating the property; and
WHEREAS, in an effort to assist the CGLDC in securing the balance of the project
financing required to complete the Project, the City Commission's adoption of this
Resolution is required;
NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF
MIAMI, FLORIDA:
Section 1. The recitals and findings contained in the Preamble to this Resolution
are hereby adopted by reference thereto and incorporated herein as if fully set forth in this
Section.
Section 2. The City Manager is hereby authorized' to execute a Subordination
Agreement, in a form acceptable to the City Attorney, in connection with the pending
refinancing of a 5-unit mixed -use housing project, located at 3659 Grand Avenue, Coconut
Grove, Florida, for the purpose of renovating said units, by the Coconut Grove Local
Development Corporation, Inc. ("CGLDC"), thereby subordinating the City's existing
second mortgage, in the amount of $120,000.00 to a new first mortgage with the State
' The herein authorization is further subject to compliance with all requirements that may be imposed by the
City Attorney, including, but not limited to, those prescribed by applicable City Charter and Code provisions.
9&- 137
of Florida Affordable Housing Loan Program, in the amount of $250,000.00 for the
aforementioned purpose.
Section 3. This Resolution shall become effective immediately upon its adoption.
PASSED AND ADOPTED this10th day of February , 1998.
XAVIER L.fiUAREZ, MAYOR
ATTES :
WALTER AN
CITY CLERK
COMMUNITY DEVELOPMENT REVIEW:
ELBERT WATERS, DIRE T R
PREPARED AND APPROVED BY:
'LINUA K. KEARSON
ASSISTANT CITY ATTORNEY
APPROVED AS TO FORM AND CORRECTNESS:
WAVIRNEY
W2197:csk:LKK
3-
JR- 137
,t Grove
i al Development
Corporation
3672 Grand nun
P.0. PDX 3nn(. �
COConucGro c. lo_-
Tel: (30.7; 446 ,()l5i.) A-1-
October 27, 1997
Mr. Elbert L. Waters
Interim Director
CITY OF MIAMI COMMUNITY DEVELOPMENT
DEPARTMENT
444 SW 2"d Avenue 2"d Floor
Miami, Florida 33130
Re: 3659 Grand Avenue
Dear Mr. Waters:
Thank you for meeting with Mr. Jeff Hepburn and myself to discuss our letter of
September 22, 1997, requesting your assistance in resolving the outstanding issues
regarding the above project. This letter had requested your approval to refinance the
existing first mortgage from $85,000 to $250,000 in favor of the State of Florida's
Affordable Housing Loan Program.
CGLDC has received approval from the State to utilize their affordable housing
loan program, which will pay off the private sector mortgage and provide sufficient
capital to enable CGLDC to match the increased cost of the project.
We hereby request that this item be referred to your Loan Committee, if
necessary, on an emergency basis since we have„been waiting for your approval for over
a month which is delaying our closing process. The State's loan program allows this
financing to be interest free for five years, with principle only payments beginning in
year three. Attached per your request is the final commitment and closing requirements
from the State.
Agdin, we are counting once again on your Department's support in our
endeavours.
Sincerely,
David J. Alexan er
Executive Director
DJA/sk
cc Jeff Hepburn - Housing Division
98- 137
STATE OF FLORIDA
�-`fix'
-Y DEPARTMENT OF COMMUNI fY AFFAIRS
LAWTO`0111f7S � "Helping Floridians cre,ire sale, rris-ant, sustainable cor—unities"
IA.AiF1, F. MURI-EY
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June 2, 1997 COPY
Mr. David Alexander, Executive Director
r Coconut Grove Local Development Corporation, Inc-
P. O. Box 330075
3672 Grand Avenue
Coconut Grove, Florida 33 233-0075
ftORIOA WS
A.:a of Cnbcal Sate Concern
Field Oifice
2796 Overseas Highway, Suite 212
Man'hcn. Fteka 33050.2227
GREEN SWAMP
Area of Cntdal State Concen
Feld Once
133 E39 Summed:,
8a-o-.Fla-da 33830 4E:i
SOUTH ROR10A
RECO1uy OfHa
P 0. 30c 402,
60 0 h' %%, JSh Strc--,
Nlwx, Flonda 331594022
Re: CDCSAP Affordable HoUSIn<, Loan/Rehabilitation of 36=9 Grand
Avenue, Coconut Grove
Dear Mr. Alexander:
Enclosed is a Loan Agreement for the loan requested by the Coconut Grove
Local Development Corporation, Inc. under the Community Development Corporation
Support and Assistance Program_ The loan is ie the amount of Two Hundred Fifty
Thousand Dollars, and is for the rehabilitation of the building located at 3659 Grand
Avenue, Coconut Grove for affordable housing. The rehabilitation is to be completed
within 24 months from the date of closing on the loan.
N
The Loan Agreement must be executed by the Chairperson of Coconut Grove
Local Development Corporation, Inc. and returned to the Department x:ithin five(5)
burin s days, so that it can be processed during the current fiscal _year. In addition, you
need to attach an accurate legal description for each of the parcels securing the loan as
Attachment A to the Loan Agreement.
In order to also get moving toward a closing on this loan, I am sending you a
iist of the items which the Department must have at least two weeks prior to closing on
the loans. While I haven't included the entire description of each item, you can look to
Section 5 of the Loan Agreement for the details of what is required:
l . Survey, per Section 5(b) of Loan Agreement
2. Title insurance commitment, with copies of all matters list:�d as
exceptions
2555 SHUMARD OAK BOULEVARD • TALLAHASSEE, FLORIDA 32399-2100
Phone: 904.488.8466/Suncom 278.8466 FAX: 904-921.0781/Suncom 29;-07b
Internet address: http://www.State.fl.us/comaff/dca,html
9 8- 137
Mr. David Alexander, Cx.cutive Director
Junc 2, 1997
Pagc T%t o -
?. Letter fro:,t Zoning Department stating compliance
4 Copy of subdivision plats, covenants, etc.
5. Copies of any DEP or other environmental approvals needed
6. Evidence that the building is loc:_ted in an eligible economically
distressed portion of the Cocon;a Grove LDC service area
7. Firm commitments for funds needed to complete the rehabilitation
S. Preliminar. take-out cotnrnim.":
9. Incumbencv Certificate, and co-porate resolution authorizing loan.
10. Evidence that the lots are not in a flood zone or have flood
insurance
I will prepare the note, mortgage and security agreement, assignment of leases,
rents and contracts, mortgagor's affidavit of no liens, and other loan documents. I will
get drafts of these documents to you for review well before time to close_ If you have
any questions, please call me, so that we can avoid any delays.
Sincerely,
Bobbie Jo Finer
Assistant General Counsel
CC' Libby Lane, Community Program Administrator
Jim Fox, Planning Manager
H:\LEGAL\BJEICDCSA "kCOCOGROV\LETTER1.97
98- 137
CITY OF MIAMI, FLORIDA CAml 9
INTER -OFFICE MEMORANDUN
TO : Honorable Mayor and
Members of the City Commission
FROM : Jose Garcia -Pedrosa
City Manager
RECOMMENDATION:
DATE : FEB 2 1998 FILE
SUBJECT Resolution Authorizing the
Execution of Subordination
Agreement/Coconut Grove L.D.C.
REFERENCES.
ENCLOSURES: City Commission Meeting of
February 10, 1998
It is respectfully recommended that the City Commission adopt the attached resolution, authorizing
the City Manager to execute a subordination agreement, in a form acceptable to the City Attorney,
in connection with the pending refinancing proposal submitted to the City, by the Coconut Grove
Local Development Corporation, for the rehabilitation of a property located at 3659 Grand Avenue.
The attached resolution authorizes the City Manager to subordinate the City's second mortgage loan
in the amount of $120,000 to a new first mortgage from the State of Florida in the amount of
approximately $250,000.00.
BACKGROUND:
Since 1993, the City of Miami, through the HOME Investment Partnership Program (HOME
Program) has administered the HOME Multi -Family Rehabilitation Loan Program, for the purpose
of rehabilitating substandard housing units in the City's C.D.B.G. target areas. Through the
program, the City is able to provide owners of substandard rental housing (5 units or more) with
deferred payment loans to finance the cost of rehabilitation. The deferred payment loan financing
further allows the after -rehabilitation rents to be charged to the tenants to be maintained at levels
affordable to very low- low- and moderate -income residents. Moreover, the HOME Program
guidelines allows for a five-year (5) or a ten-year (10) deferred payment loan, depending on the
level of financing provided. The HOME Program guidelines also allows for the City to forgive ten
(10%) percent or twenty (20%) percent of the total loan amount on an annual basis, as long as the
project remains in full compliance with the HOME Program requirements. The HOME Program
Rinds are provided to the property owner as a forgivable loan, because the Program requires the
owner to provide housing accommodations to low- and very low-income tenants (60% of median
income or less). As a result, the HOME Program rents are on average substantially lower than the
market rents for the neighborhood where the projected is located.
In December of 1996, the Coconut Grove Local Development Corporation, Inc. (CGLDC) received
a loan in the amount of $120,000.00 under the City's HOME Multi -Family Rehabilitation Loan
Program in connection with the rehabilitation of a 5-unit apartment building located at 3659 Grand
Avenue.
�Q_ 137
Honorable Mayor and
Members of the City Commission
Page 2
In October of 1997, Mr. David J. Alexander, Executive Director of the Coconut Grove Local
Development Corporation, Inc., made a written request to the City, regarding the subordination of
the City's second mortgage in the amount of $120,000.00 to a new first mortgage from the State of
Florida in the amount of $250,000.00. Currently, there is a first mortgage with Bank United on the
subject property in the amount of approximately $85,000.00. Presently, the assessed value of the
subject is approximately $133,706.00.
The $250,000.00 in State of Florida funding will be utilized by the Coconut Grove Local
Development Corporation, Inc. in the following manner:
1. Pay-off of existing first mortgage $85,000.00
2. Balance of funding to complete residential renovations $30,000.00
3. Funds to complete commercial rehabilitation of ground floor $55,000.00
4. Construction of new parking lot $50,000.00
5. Other project expenses (permitting, fees, attorney fees, etc.) $30,000.00
$250,000.00
In an effort to move the proposed mixed -use housing project forward, it is recommended that the
City Commission approve the Coconut Grove Local Development Corporation's request for the
subordination of the City's HOME Program loan in the amount of $120,000.00.
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