The URL can be used to link to this page

Home My WebLink AboutR-85-08360 J-85-7U1 7/30/85 RESOLUTION NO. 85--8'13� ► A RESOLUTION EXPRESSING THE INTENT OF THE CITY OF MIAMI (FLORIDA) TO PROCEED WITH THE: DEVELOPMENT OF A MULTIFAMILY REN'PAL HOUSING PROJECT AND THE FINANCING OF 91 UNITS 'THEREOF THROUGH THE ISSUANCE OF MULTIFAMILY MORTGAGE REVENUE BONDS IN AN AMOUNT NOT TO EXCEED $6,000,000 FOR THE BENEFIT OF CIRCA/BARNESS/SAWYER, A JOINT VENTURE ESTABLISHED IN PART FUR THIS PURPOSE. WHEREAS, the City Commission has determined that there exists a shortage of safe and sanitary 1►ousing for persons and families of low and moderate income within the City; and WHEREAS, such shortage will be partially alleviated by the construction and operation by a private developer of a low -to - moderate income housing project to consist of approximately 91 units, to be occupied by persons of low and moderate income located at N.W. 6th Street through N.W. 7th Street between N.W. lst Court and N.W. 2nd Avenue in the City of Miami, Dade County, Florida, (the "Project"), which Project is part of the Overtown/Park West Redevelopment Area, to be developed by Circa/Barness/Sawyer (the "Developer"), a joint venture established for this purpose; and WHEREAS, in order to provide financing for the acquisition, construction, and operation of the Project, the City intends to issue its multifamily mortgage revenue bonds for the benefit of the Developer in an amount currently estimated not to exceed $6,000,000 (the "Bonds") and to enter into a Loan or Financing Agreement, a Trust Indenture, a Regulatory Agreement as to Tax Exemption and other necessary documents with respect to the Project; CITY C�;�:IrISSICN MUE1'Ir.112 C.'r' J U L 25 1985 NOW THEREFORE, BE IT REoJLVED BY THE COMMiSSION OF THE CITY OF MIAMI, FLORIDA: Section 1. All findings and recitals t_ontained in the Preamble to this resolution are adopted by reference and are incorporated herein as if fully set forth in this section. Section 2. The City Commission hereby expresses its intention to approve at a Later date, by appropriate resolution, and upon compliance by the Developer with the City's prescribed procedures for issuance of multifamily revenue bonds, the financing of the development of the 91 Unit Project (the "Project") by the Developer through the issuAnc(2 of its Bonds and the execution of the necessary documents, including a Trust Indenture, Loan or Financing Agreement and a Regulatory Agreement as to Tax Exemption; provided, however, such Bonds shall not be issued unless the Bonds, if publicly offered, are rated at least "A" or better by either Standard & Poor's Corporation or c400dy's Investors Service, Inc. or both, if both rate the ►3onds; or, alternatively, the Bonds, if not rated, are sold by private placement to institutional investors and provided, however, such bonds that are not required by the developer shall not be utilized by the City for any other project without the specific approval of the City Commission; Section 3. This Resolution shall constitute "official action" of the City Commission toward the issuance of the Bonds, within the meaning of the regulations issued by the Internal Revenue Service pursuant to Section 103 of the Internal Revenue Code of 1954, as amended. Section 4. The inducement period for the Project shall have a term of six (6) months from the date of adoption of this Resolution (the "Inducement Period"). The Inducement Period is subject to extension by the City Commission upon compliance by the Developer of certain requirements established by the Commission, including the payment of an additional fee to the Commission and bond counsel at the termination of the lnducement Period. -Z- 85-836 Section 5. r►ie financing f,�r the Pro.,a,,:t wiil be closeu r subject to validation of multifamily mortgage revenue bonds by the Circuit Court of Dade County, Florida, incLuding the Bonds. The City Commission makes no representations or guarantees as to the scheduLiny or outcome of val.ic3,stion proceedings in the Circuit Court of Dade County, Florida nor is the City compelled to file for validation of bonds for any particular multifamily project. The various projects induced by the official action of the City Commission shall be e:losed on a first -come, first -served basis. Section 6. All resolutions and orders or parts thereof, of the City Commission in conflict herewith are, to the extent of such conflict, hereby modified to the extent of such conflict, and this Resolution shall take effect from and after its passage, the public welfare requiring it. Section 7. It is found and determined that dll formal actions of this Commission and of its committees concerning and relating to the adoption of this Resolution were taken in an open meeting, open to the public, in full compliance with all legal requirements. PASSED AND ADOPTED 'PHIS ATTEST: 25th DAY OF Jul , 1985. RA PH G. ONGIE�------ CITY CLERK PREPARED AND APPROVED BY: R ERT N. SECHEN 'ASSISTANT CITY ATTORNEY MIM Maurice A. Ferre_ MAURICE A. FERRE, MAYOR APPROVEDME.' v FORM AND CORREC; LUCIA A. CITY ATTO 85-83C CITY OF MIAM1, FLORIOA INTER -OFFICE MEMORANDUM 54 TO The Honorable Mayor DATE- July 8, 1985 FILE: and Members of the City Commission SL9JECT Ci rca/Barness,/Sawyer inducement Resolution City Commission Meeting FROM REFERENCES: July 18, 1985 Sergio Pere' a ENCLOSURES City Manage 1) It id- recommended that the City Commission approve the attached resolution expressing the intent of the City of Miami (Florida) to proceed with the development of a multifamily rental housing project and the financing o 91 units thereof through the issuance o multifamily mortgage revenue bonds in an amount not to exceed $6,000,000 for the benefit of Circa/Barness Sawyer, a joint venture established in part for this purpose. The City of Miami is requesting an Urban Development Action Grant of $11,667,400 to be used as gap financing for the development of 441 units of rental housing, 336 units of for -sale housing, 118,200 square feet of commercial space and supportive parking for 928 cars. The development will occur as part of the initial stage (Stage I) of Phase I of the Southeast Overtown/Park West redevelopment Project. Stage I represents a private commitment of over $53 million. Circa/Barness/Sawyer submitted a proposal and was selected to develop 60 condominium units, 91 units of low-income rental housing, 63,200 square feet of commercial space, and 25 parking spaces on Parcel 56 within the Southeast Overtown/Park West Redevelopment Project. This development was proposed for Urban Development Action Grant (UDAG) assistance, along with devel- opers of three other parcels. Construction is expected from 1985-1988. The City has requested a $2,277,400 UDAG subsidy for Parcel 56 (14.9% of the Parcel's estimated $15.24 million pri- vate development cost) in order to make the Circa,/Barness/Sawyer proposal and development program more economically feasible. This feasibility gap is created by development costs that require rents and sales prices that are: (a) too high to be affordable to rentors and homebuyers in the low- and moderate -income ranges and (b) too high to attract a necessary front-end complement of mid- dle income renters and homebuyers, given the present negative im- age of the area. 85--83G. /°1 '` Mayor and City Commission -2- July 8, 1985 - The subsidies are needed to insure that a sufficient number of units are built and occupied at the outset to create a critical :Hass needed to make the new -town in -town concept a success (this amount is believed to be a minimum of 450 to 550 units coming on line in the first year of marketing). Alternative funding sources are being pursued in the event UDAG assistance is not made available. Upon recommendation of Shearson/American Express, the general bond underwriter for the multifamily housing revenue bonds authorized by the City Commission pursuant to Ordinance No. 9539 as amended, Circa/Barness/Sawyer is eligible for and may require housing bonds to further assist in financing the low-income rental portion of its development. The attached inducement resolution expresses the intent of the City to proceed with the development of multifamily rental hous- ing within Parcel 56 and the financing of the 91 Units proposed by Circa Barness Sawyer. The attached pro forma for the project indicates that the developer is currently proposing to utilize $5,500,000 in Mortgage Revenue Bonds (M.R.B.) and approximately $705,000 in a UDAG loan for this segment of the project. The utilization of M.R.B.'s mandates that at least 15% of the units be restricted to low income families and the remainder for moderate income families. There is no financial liablity on the part of the City for the M.R.B.'s and to date the City has authorized the issuance of up to $155 million in M.R.B.'s and none have been issued. A similar resolution was recently adopted by the Housing Finance Authority to induce such bond financing of the Can/American Real- ty development on Parcel 37. ATTACHMENT NOTES rO DEVELOPMENT BUDGET - BLOCK 56-RENTAL 'UNITS 1. Construction anticipated to take 12 ;months after a July 1, 1986 start-up. 2. Mid -Rise Construction: 35 Studios @ 432 square feet (including balconies) 40 One -bedrooms @ 648 square feet (including balconies) 12 Two -bedrooms @ 756 square feet (including balconies) 4 Three -bedrooms @ 972 square feet (including balconies) Mid -Rise Construction includes 15% non -rentable space. 3. Construction Interest based on 9.5% interest only during construction for one-year. Average balance of 40% invested at 9% earnings. 4. All site preparation, improvements, landscaping, and amenities for Block 56 included in rental units budget. 85-836 _. ;t, 1 n DEVELOPMENT BUDGET SOUTHEAST OVERTOWN/PARK WEST --BLOCK 56 RENTAL UNITS 91 UNITS MID -RISE Total Construction Soft Costs: A&E, Legal, Financing Fees (10%) Taxes, Insurance, Administration (5%) Contingency (7%) Construction Interest Lease -Up Interest Developers Fee Marketing Bond Reserve Total Soft Costs TOTAL DEVELOPMENT BUDGET SOURCES OF FUNDS Cash Equity Contributed Developer's Fee First Mortgage (30 yrs./9.51) UDAG Loan TOTAL SOURCES OF FUNDS 4500000 450000 225000 315000 215000 100000 275000 100000 1000000 2680000 7180000 700000 275000 5500000 705000 7180000 85--83� % NOTES TO INCOME AND EXPENSE PROFORMA - BLOCK 56 RENTAL UNITS 1. Year 1 begins July 1, 1987 2. Rents - Year l: Mid -Rise - Studios $450/month One -bedrooms S500/month Two -bedrooms S650/month Three -bedrooms $750/month 3. Vacancy: Year 1 - 40% Year 2 - 15% Year 3 and thereafter - 5% 4. Operating Expenses based on 30% of Available Gross Residential Income. 85-836-