HomeMy WebLinkAboutR-95-0108J-95-76
12/30/94
RESOLUTION NO.9 5 " 108
A RESOLUTION, WITH ATTACHMENT, AUTHORIZING
THE CITY MANAGER TO EXECUTE A SUBORDINATION
AGREEMENT, IN SUBSTANTIALLY THE ATTACHED
FORM, IN CONNECTION WITH THE LEASE AGREEMENT
BETWEEN THE CITY OF MIAMI AND OLYMPIA
BUILDING PARTNERS, LTD.
BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI,
FLORIDA:
Section 1. The City Manager is hereby authorized to
execute a Subordination Agreement, in substantially the attached
form, in connection with the Lease Agreement between the City of
Miami and Olympia Building Partners, Ltd.
Section 2. This Resolution shall become effective
immediately upon its adoption.
PASSED AND ADOPTED this 9th day of-Februaryof-February 1995.
CA
�v•
STE EN P. CLA , MAYOR
ATTES
MATTY HIRAI, CITY CLERK
PREPARED AND APPROVED BY:
c t_�
RA 'AEL 0. IAZ
DEPUTY CITY ORNEY
ROD:cm:M4860
APPROVED AS TO FORM AND
CORRECTNESS:
ATTACHRUINT
I CONTAINED
CITY COMMSSSION
KEETING OF
FEB 0 9 1995
BeWN49r} rip!
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1305
MIAMI PARKING AUTH. F-696 T-072 P-003/006 DEC 29 '9+4 10:59
DEC, 29 I 1 51 at'I ' oI
SUBORDINATION AGREE4�NT
CITY 0 F, �.gUBgRDJNAT10N AGREEMENZ` ("Agreement")
day of * ' „_ _. 1995 by The City of
corporation of the State of Florida (the
of
is made
Miami# a
"City"),,
( the
this
municipal
in favor
"Lander") .
R E C I T A L St
A. The City# as Lessor, and Olympia Building Partners, Ltd.,
a Florida limited partnership (the "Developer"), as Lessee, entered
into that certain Lease Agreement dated March 18, 1994 (the
"Lease").
B. pursuant to the Lease, the City leased to the Developer
the land and improvements described in Exhibit "A" attached hereto
and made a part; hereof (the "City Property").
C. Pursuant to Section 3.5(g) of the Lease, the Developer
has delivered to the City a Payment Guarantee (the "Guarantee")
executed by Cornerstone Olympia, Ltd. and Cornerstone Affordable
Housing, Inc. The Payment Guarantee guarantees the payment of all
Rentals (as defined in the Lease) due under Section 3.5(d)(1) and
Section 3.5(d)(2) under the Lease.
D. Pursuant to Section 3.5(g) of the Lease, the Payment
Guarantee is secured by an assignment of rents (the "City
Assignment").. executed by the Developer in favor of the City,
pursuant to which the Developer has granted to the City a first
priority interest in the rents from a sufficient number of the
Leases for retail space at the Project (as defined in the Lease),
to secure the Payment Guarantee.
E. The Developer has obtained from the Lender a written
commitment (the "Commitment") for a loan or loans which shall,
after completion of the construction of the contemplated
Improvements on the City Property, become a permanent loan or loans
in the principal amount of up to $400,000.00 and having a term of
not to exceed thirty ( 30 ) year's after such completion (the "Loan") ,
which Loan is to be secured by a first leasehold mortgage
encumbering the Lease and the Developer's leasehold estate in the
City Property.
F. Pursuant to the Commitment.. the Developer has executed or
.shall be executing in favor of the Lender a collateral assignment
of all rents and leases and profits (the *!Lender's Assignment")
derived from the operation of the improvements on the City
Property. ,
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MIAMI PARKING AUTH. F-696 T-072 P-004/006 DEC 29 994 10:59
G. The Lender is unwilling to make the Loan to the Developer
pursuant to the Commitment unless the City agrees to subordinates
the City Assignment in all respects to the Lender's Assignment.
H. The City is willing to subordinate the City Assignment to
the Lender's Assignment pursuant to the terms and conditions of
this Agreement.
TRRXS:
1. Recitals..The foregoing recitals' are true and correct
and are made a part of this Agreement.
Z. Subordination. The City hereby agrees that the City
Assignment (and the lien, encumbrance, terms, covenants, conditions
and provisions of the City Assignment) are and shall at all times
be subject, subordinate, and inferior to the Lender's Assignment
(and the lien, encumbrance, terms, covenants, Conditions and
provisions of the Lender's Assignment), and that the Lender's
Assignment (and.,the lien, encumbrance, terms, covenants, conditions
and provisions of the Lender's Assignment) shall at all times be
senior, superior to, and of higher priority than the City
Assignment (and the lien, encumbrance, terms, covenants, conditions
and provisions of the City Assignment). in furtherance of the
foregoing agreement, the City doe-8 hereby subordinate the City
Assignment (and the lien, encumbrance, terms, covenants, conditions
and provisions of the City Assignment) to the Lender's Assignment
(and the lien, encumbrance, terms, covenants, conditions and
provisions of the Lender's Assignment).
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the date first above written.
Signed, Sealed and Delivered
in the Presence of:
THE CITY OF HIAMI, a municipal
corporation of the State of Florida
By: The City Commission of the
City of Miami
Name:
By:
Cesar H. Odio
Name: Its: City Manager
-a-
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1305
MIAMI PARKING AUTH.
F-696 T-072 P-005/006 DEC 29 194 11:00
STATE OF FLORIDA
COUNTY OF DADE
The foregoing' instrument was acknowledged before me this
day of , 1995, by Cesar H. Odio, Cit
M Ager of the City Commission of the City of Miami, on behd1f Of
the City of Miami, a municipal corporation of the state of Florida.
He is personally known or produced as identification
and did (did not) take an oath.
Signature:
Name: IPrint or type) --
Title: Notary Public
Serial No., if any:
My Commission Expires:
APPROVED AS TO FORM AND
CORRECTNESS:
/'. fl.701..►�/lr ,i/
ATTEST:
NATTY HIRAI
City Clerk
UM 330Ma - LIM
12WJ94
- 3 --
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1305 M I AM I PARE: I NG AUTH.
EXHIBIT "A"
F-696 T-072 P-006/006 DEC 29 '94 11:00
Lot
1,, Lot 2
(leas the hest 2
inches of
the
North. 65 feet ),
the
South 88
feet of Lot 3 and
the north
43
feet of Idta 18,
19 and 201 in Block 121 North, xAP Off* KXW, according to the
plat thereof# as* recorded In plat Book "B", at Page 41, of the
Public Records of Dade County, Florida, together with, the
improvements upon the above -described reel property other than
'the following areas within said improvements which are not
Included in the property being leased to Olympia Building.
Partners# Ltd., a rlorida limited partnership:
(a) the theater known as The Gusman center for the
Performing Arts ( the "Theater");
(b) the Theater lobby=
(c) the second floor of.The Olympia Building;
(d) 'the alley running south from Flagler Street; -and
(0) the alley running west from Southeast Second
Avenues
ew a 33"M.1 - TF
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130� PI1Hh11 PHRK1NG HU1H. F-456 T-338 P-002 JAN 26 195 1?:05
53.
Ronorable mayor and DATE: Jisnuary 26, 199b
meMers or the City Ccamiumiw-L
FROM: Cos 8C1=CT; Olympia Building Redevelopment
Cit
Cit v awl
On January 12, 1995; the City Commission Considered two resolutions
regarding tue wyapia !luilding redevelopTwnt. troth were passova wiLli
the proviao that Commiamionor Dawkino h*vo five working days to
roceiv* wn-w+ra hn hin queationslissues.
The ..affected partiaa met with CommniQsioner Dawkins during the
specified period. , The Commissioner has indicated tnat he , wishes, to
further dissuUmb buLi, XequhsLB. Therefore, theme matters have been
ploved an the'ag+nda of the February 9, 1995 Commission meeting
ar:kw012695.01
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531
TO: CESAR H. ODIO
City Manager
FROM : TTY HI I
Clerk
U -
CITY OF MIAMI, FLORIDA
INTER -OFFICE MEMORANDUM
DATE: January 24,1995 FILE :
Two Agreements with Olympia
suaiECT : Building Partners, Ltd.
REFERENCES:
ENCLOSURES:
During the City Commission meeting of January 12, 1995, Agenda items 54-A and 54-B
passed with the proviso .that Commissioner Dawkins had five working days to object, in which
case said items would be rescheduled to the February 9th Commission meeting.
AGENDA
ITEM:
54-A (Proposed resolution .authorizing the City Manager to execute a subordination
agreement, in connection with the lease agreement between the City of Miami and
Olympia Building Partners, Ltd.)
54-B . (Proposed resolution authorizing the City Manager to execute a loan agreement with
{npla Building Partners, Ltd., in an amount not to exceed $600,000, said loan to
be used in the redevelopment of the Olympia Building, located at 174 East Flagler
Street, Miami, Florida; allocating funds therefor from the CDBG-Assisted Mufti -Family
Rehabilitation Loan Program.)
Commissioner Dawkins did raise objections in connection with said items (see memorandum
attached) and requested a member of my staff to have both of these issues rescheduled for
consideration as part of the February 9th Commission agenda.
MH:sI
cc: Elvi Galiastegul, Agenda Coordinator (w/encl.)
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CITY OF MIAMI. FLORIDA
INTER -OFFICE MEMORANt11b1
TO: Honorable Mayor and Members of the
City Commission
FROM ` Miller J. Dawkins
Commissioner
DATE : %noky J?, it595.40
SUBJECT : O piaBuildi ig/Dept. of
e
mission Agenda
REFERENCES :Item # 54
ENCLOSURES:
As requested, I reviewed this morning, Tuesday, January 17th, with staff and the
developer of the Olympia, Building, the Subordination Agreement and $6000,000 set
aside which was requested by the, Department of- Off -Street Parking (DOSP) at the
January 12, Commission. Meeting.
The Subordination Agreement which will. permit the developer to borrow $400,000 from
a private -lender is fine because I have been told by staff this is a routine procedure for
developments of this type.
Now, in regards to the item requesting a $600,000 set -aside from the CDBG multi -family
rehab program, I have serious problems relative to the extent of financial commitment the
City is making to develop the Olympia Building which is City property. A review of the
records (March 24,- 1994) show that we previously set -aside $1.5 million for this project
and this $600,000 will bring the City's commitment to $2.1 million for a project whose
total development costs is $5.2 million and for which $2.7 million will be paid from tax
credits.
FILE
Considering that the developer has only a private financial commitment of $400,000, it
would seem that this developer could secure the balance of his financing from an outside
source. Again without the $600,000 the City's Commitment is $1.5 million.
Upon further review of the lease and commitment of DOSP to make this development
feasible, I do not see any commitments or participation, that DOSP is putting into this
project in order to makelt work. For example, flexible lease terms, or hard rash.
It appears from looking at the lease that DOSP is using the City to finance its
development without making any monetary contributions or concessions on their part.
This is the first RFP I have seen the City (DOSP) put out for bid in which the City does
all the financing for the project. If I am in error, I would like for the administration or
City Clerk to produce records showing I am wrong. 9 5 - 108
95- 109
r
Honorable Mayor and Members of the
(_ City Commission
January 17,1995
Page Two
Therefore, I am recommending that DOSP, in some way, find a method whereby they can
assist this developer to secure the additional $600,000, needed for this project from
sources other than the City of Miami.
To recap, the following is a tabulation of this project's current sources of financing:
Sources: Tax Credit Aquity
Historical Tax Credit Equity
Bank . .
CDOB Funds (Requested)
City of Miami HOME Loan (Committed)
Total Sources:
$1,920,000
820,000
400,000
600,000 `
19560,006
$5,240,000
It appears from the above listed sources of financing that there should be ample
incentives to secure a private lender for the balance of the funds.
Based on the above development costs, in my opinion, $65,500, per unit ($5.2 million
divided by 83 units) is an outrageous price to pay for efficiency and one -bedroom units.
This is a worthwhile project for the Downtown community, however, if it cannot be
structured to maximize private financing commitments it is a bad economic deal. Again
the City Commission is allowing Housing funds to be used to fund City of Miami's
projects..
The Commission is being asked to allow the Manager, Mr. Bailey and Mr. Cook to use
`Sow -Income Home Funds) to do a City project paying an estimated $65,000 per unit .
(efficiency or one bedroom apartment) where Home Fund regulations says low -rent. The
maximum allowed is $500 a month per unit, so we will permit; The Manager, Mr. Bailey
and Mr. Cook to spend $65,000/unit so a developer can rent the same for $500 a month.
Remember the City of Miami has build 3 bedroom, 2 baths homes for $60,000 each.
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