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Home My WebLink AboutR-91-0910ap 311 J-91-860 10/21/01 010 r RESOLUTION NO• A RESOLUTION, WITH ATTACHMENTS, AUTHORIZING THE CITY MANAGER TO PREPARE AND SUBMIT AN APPLICATION TO THE UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT ("HUD"), IN SUBSTANTIALLY THE PORN! ATTACHED AND ACCEPTABLE TO THE CITY ATTORNEY, FOR A $2.4 MILLION LOAN UNDER THE HUD SECTION 108 PROGRAM FOR THE PURPOSE OF REFINANCING A PRIVATE DEBT EXTENDED TO THE MIAMI RIMER INN PROJECT; FURTHER DIRECTING THE CITY MANAGER TO BRING THE HUD APPROVED LOAN BACK TO THE CITY COMMISSION FOR FINAL APPROVAL TO DETERMINE ADEQUACY OF COLLATERAL PROPFERED TO THE CITY BY THE OWNER OF THE MIAMI RIVER INN PROJECT. WHEREAS, the City of Miami is committed to assist private investments that will create new jobs and remove slum and blight in the designated Community Development Target areas; and WHEREAS, the Miami River Inn project ("Project") is a privately initiated effort, trying to revitalize a number of historically significant buildings, and converting them into apartments and a bed and breakfast house; and cod s as WHE1 E�,5, the RIX has recalled the loan and is hOt offfarinq any alternative refinancing plans; WHP.R9AS, the project attempts to rOfinanoe its' hain obligation -with the ,RTC has not generated any interest from OVOr twenty local"and out of town financial institutions; and WHEREAS, the RTC is planning to initiatO .the foreclosure proceedings. in case the loan is not paid by the due 7 date; WHEREAS, it is to the City's interest' to see this private effort succeed and expand; and WHEREAS, the ,United States Department of Housing 'wand t ban'Development has established the Section 108 Loan program to , assist projects located in the Community' Development- target areas; and, WHEREAS, repayment of the HUD Section 108 Loan shall be made by the;revenues';generated from the lProject. WHEREAS, the City will use its future Community Development Block Grant allocations as 'collateral for the said; loan; and WHEREAS; the owner of the Project will'pledge personal assets as _ collateral to the City in: the event, of default on;`the loan; NOW, THEREFORE, BE IT RESOLVED' BY THE COMMISSION OF THE CITYYOF MIAMI,'FLORIDA: -2- �3 t 31 1 yrf` f i 4 < cZ-4 SECTION 1 The City Manager is hereby authorized.tlo prepare and submit an application, in substantially the fo�n attached and eeptabl-e to the City Attorney, to the United Stites Department of Mousing and Urban Developiment for.. a 166n under the HUD Section 108 program in an amount not to exceed $264 million for the purpose of refinancing a private debt extended to the Miami river Inn Project. SECTI01� .Z . The -City Manager is hereby, further directed to bringthe MUD approved loan back to the City Commission 'for final approval to determine the adequacy of the collateral proffered to the City by the owner of the Miami River Inn Project' in the event of default of the loan. SECTION 3. This Resolution shall become effective immediately upon its adoption. PASSED AND ADOPTED this 5th day of December , 1991. MAYOR XAVIER L.-S E , ATTEST: COMMUNIT E'tl NT REVIEW AN s ,y MAT Y URAI, CITY CLERK FRIMK'CASTANEDA, DIRECTOR �r y -3- '. 9 -- rz t t i q jall �LJl3 i Ate REVIEW AND APPROVALFINANCIALRNVISW ANCI APPROVAL Q NN S► II LIN A K. KE SON CITY AT 0 EY ASSISTANT CITY ATTORNEY x 2 y —4— 'f k3l i' g n fy M �Y Qii��i�j ti y�Tj,�i. yp it ydmy�TW(''�•i iYufjji (�jiyY�� •jY•i fd�{�yyaaiii�•% i� /iY �j. \yif� ii iY YiYV{i ��V +.i131 G111 �ii�rii inn YQC. ��p1it��I,S.cJi1 E �f y i Applic&tiont page '42 {`d�'ytI��arit��ayyr�l((`i'p�yy'�s }iyynyyii� �/y�i �y Descripirion i i f • • i i • • i i • i • 1 • • • • • • • • 1 • • • . • • Y • • • i • {ice. Yyy boy, •jy yb�i{�ydyt jy \r llVl3y�r�"�y MC . i .'. .a.�-i . Y "i i i • i. . . . : . : , �� 3 �+L'y 3I♦iat S. MV Compliance with National qi j�• Objectiv�l••i�••••••••iYY•iiiY 4 Proposed Rep6yment•••••••ii••ii i••i••i►••i i•i iifii. •Y'iY 5 Certifications Addenda: Maps Public Notice s �. !. r r, g 4 t ' A_F `�., t w fi xY. Y.xY f .>£,- .lti Uvt,.y .7Wv� lwy i-ta y Y I G lI� city of Miami, Plotida Section 108 than Guarantao Application `. Miami River Inn p rojoct x ti e Applicants City of Miami., Florida, a municipal}# ` corporation _ a - Amount of Funds 3 Loam Repaymenti s interest only during first three years, ' payable semiannually; principal and interest:during years four through ten, payable semiannually, at the interest x, rate specified by US HOD pursuant to its offering National Objectives: Creation of 60 full-time equivalent jobs, of which at least 75% ,woul& be f`s low -toy -moderate income persons 570,702 (b)(2) Prgct Deseion: The City of Miami ( "Applicant") pro-- + poses to use the $2,400,000 of Section 108 loan fund to refinance r a $2,000,00..construction loan originally extended by a private financial institution to the Miami River Inn ("Project' and a, new loan for $400,000 toward the completion of a restaurant which is an integral part of the overall development. �53 The Magic City Enterprises ("Partnership"), owner of the project, {k' is.a. general Florida partnership that ;obtained a loan from Firsa .' Investor's:of Florida ("Lender") for the ,purpose of developing' = fifteen'units_of residential apartments, forty -room bed and ' ,a breakfast house and a,supporting restaurant. The project is., 4' located in the East little Havana CD target area, along the Miami { River. The project location.'also:falls in the State of Florida r'f E Enterprise Zone. s. The Project has been in existence forfiveyears. To date all residential apartments are completed and occupied, the forty. unit } bed and breakfast house has been` completely renovated and is ?vr currently in use. Site acquisition and some of the renovation; work for the restaurant have been done, nevertheless additional ;' {r� ry 3 Funding is necessary for completion. 44X 96 Iry '::Rl 4 :}K4Y Nc 19?wT x?.f X Oil Cityti►ri�3.'lr.��a The lied for the` financing o� the original loan agreement ca including the restaurant. the ier�der.00nsid nti a d0vel6'pment Bred the `pos6ibill of converting the cofistructio�t lcsan t� a riiortgage, ne��a the less, the Atesoldtion Trust corpctatidn { " t' �'! f infindial institution and Is seeking red a�tient has taken over the , of the entire, lean. The Partnership has contacted over twenty five financial iinstitu�- tions to refinance the loan, however in light of the current new regulations, the project crises in the, banking industry and has not received any interest fromany of the financial instituW tions to ``date . The proceeds of the'proposed'108 Loan the'RTC will be'used to; 1) pay off and 2) finance. the comple- the outistanding;'$2 million :to tion of the "restaurant 'that will play a key role for the . overall sdccess`.`of project. J h -h:Y6 J r K J 1 _. ��_rv. 1 J Yt� 1 W C" } city Of nami.t Florida 3@ctLon l08 toani Guarantee Application Miami River Rift Pro jeCt a Page 5 14¢tid,Y�ni�itt.. Schedul : The ( 4 Applicant's loan to the Partnership stipulates a ten (10) year ,> term from date of disbursement, interest only for the first three yearn, payable semiannually at the rate of interest specified by US HUD. For the years four (4) through ten (10), interest and' principal payments amortized for six (year) period, payable quarterly at the same initial interest rate specified by US HUD. In the event that the Partnership repays the loan prior to the end of the tenth year, the Applicant proposes to utilize the Sect -ion 108' Iran fun:is in a revolving loan fund for other eligi- ble community redevelopment projects. The interest and principal payments for the Section 108 Loan w'11 be paid by thn Partnership; or by subsequent partnerships, corpo- rations, persons if applicable. The applicant reserves the right to pay interest as well as principal payments from any other source of funds available at the time. Additionally, the Appl- cant reserves the right to acquire the assets of the Partnership, through foreclosure:if necessary, and to liquidate the same in the event of a default on the Partnership's loan, and to utilize ` the proceeds of the liquidation sale to repay if any other source of funding engaged to make interest and/or principal payments. Any deficiency which may result shall be pursued by the Applicant- - aga�inst.the Partnership` under the terms of the Loan Agreement b and between the Applicant and Partnership. Community Development Block Grant ("CDBG") funds serve only as the guarantee to the US HUD. The'Applicant does not intend or" • expect -to utilize CDBG funds for interest or'principa'1 payments for repayment of'the Section 108 Loan. The Applicant has:re- viewed the project' request and, based upon, the information:pres- ently available, believes* that the proposed loan is- appropriate to, further'the redevelopment efforts of the Applicant in the East Little Havana Community Development; Target Area. Applicant shall obtain a first lien (mortgage) on ttie building:' improvements, furniture,fixtures, equipment, ,and: inventor y. 'located° ,upon the premises now and' during the loan term as secure- ty for its loan., i' t z A. L! 1 uLi W W city of Miami. t Florid& Section 10g toast Guarant+ae Application �tia�t diver lrttt P'rc��+aot `Page 5 y 57010261612 -'. r' posod Ropttytnent.cmd Repayment Sthgo ult The .,. Applicant's loan to the'Partnership stipulates a ten (10) year t term from dat:- of disbursement, interest only for the first three =. years, payable somiainnually at the rate of interest specified by US HUD. For 'the' 'years four (4) through ten (i0) , 'interest and principal payments amortized for six (year) poriod payable quarterly at the 'same initial interest rate specified by US HUD. In the event that'the Partnership repays the loan prior to the end of the tenth year, the Applicant proposes to utilize the Section 108 roan funds in a revolving loan fund for other eligi- ble community redevelopment projects. The interest and principal payments for the Section 108 Loan will ' be paid by thn Partnership, or by subsequent partnerships, corpo- rations, persons if applicable. The applicant reserves the right to pay interest as well as principal payments from any other source of funds available at the time. Additionally, the Appli- cant reserves the right to acquire the assets of the Partnership, through foreclosure i.f necessary, and to liquidate the same in the event of a default on the Partnership's loan, and to utilize the proceeds of the liquidation sale to repay if any other source of funding engaged to make interest and/or principal payments. Any deficiency which may result shall be pursued by the Applicant against the Partnership under the terms of the Loan Agreement by and between the Applicant and Partnership. _ =' Community Development Block Grant ("CDBG") funds serve only as the guarantee to the US HUD. The Applicant does.not intend or expect to utilize CDBG funds for interest or principal payments for repayment of the Section 108 Loan. The Applicant has -re- viewed the project request and, based upon the information pres- ently available, believes that the proposed loan is appropriate to further the redevelopment efforts of the Applicant in the East Little Havana Community Development Target Area. Applicant shell obtain a first lien (mortgage) on the building` improvements, furniture, fixtures, equipment, and 'inventory, located upon the premises now and during the loantermas securi- ty for its lean. t 7 h 9— �;1p i- 4 . City of Miami, Florida Section 108 Loan Guarantee Application Miami River Inn Project Page 4 ontpliartcc .mWi 10-208 _• Jobs 0-datio,t: The Partnership has indica- ted that the Proposed completion of the restaurant resulting from the financial assistance.being provided by the Applicant will 3 create approximately60 full -time jobs, primarily benefiting low- to -moderate income persons. in order to meet the national objective of creating the jobs to benefit low=to-moderate income persons, the Parrnermhip will work closely with local nonprofit job placement agencies such as Private industry council, city of Miami Neighborhood Jobs Program, etc. , 4- x 9.1 a: .44ReNn4MN.�