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Resolution
City Hall
3500 Pan American
Drive
Miami, FL 33133
www.miamigov.com
File Number: 08-00609 Final Action Date:
A RESOLUTION OF THE MIAMI CITY COMMISSION, WITH ATTACHMENT(S),
AUTHORIZING THE ALLOCATION OF COMMUNITY DEVELOPMENT BLOCK
GRANT ("CDBG") FUNDS, IN THE AMOUNT OF $3,000,000, FROM THE CITY OF
MIAMI DEPARTMENT OF COMMUNITY DEVELOPMENT CDBG HOUSING
RESERVE TO MODEL HOUSING COOPERATIVE, INC., AS SPECIFIED IN
EXHIBIT "A", ATTACHED AND INCORPORATED, FOR THE PURCHASE OF THE
SUNTRUST BANK SENIOR CONSTRUCTION LOAN FOR THE VILLAS DR.
GODOY HOUSING PROJECT LOCATED AT 1455-1479 WEST FLAGLER
STREET, MIAMI, FLORIDA, LEGALLY DESCRIBED ON EXHIBIT "B", ATTACHED
AND INCORPORATED; AUTHORIZING SAID PURCHASE TO BE
SUBSTANTIALLY ON THE TERMS STATED IN EXHIBIT "C" ATTACHED AND
INCORPORATED; AUTHORIZING THE CITY MANAGER TO EXECUTE ALL
NECESSARY DOCUMENTS FOR SAID PURPOSE(S).
WHEREAS, on September 13, 2002, the City of Miami ("City") Housing and Commercial Loan
Committee ("HCLC") approved an allocation of $1,280,000 of Home Investment Partnerships
("HOME") Program funds to Model Housing Cooperative, Inc. for the development of the Villas Dr.
Godoy project ("Project") consisting of thirty-two (32) condominium units located at 1455-1479 West
Flagler Street, Miami, Florida, of which all would be HOME -Assisted. The Project started construction
on December 20, 2004; and
WHEREAS, on February 4, 2005, the HCLC approved extending the Project completion
deadline, from September 2005 to June 30, 2006, due to requirements set forth by SunTrust Bank
("SunTrust"), the senior Project construction lender, to keep the completion date consistent between
all Project lenders; and
WHEREAS, on September 22, 2006, the HCLC allocated an additional $270,000 in HOME
Program funds for Project costs related to the water and sewer connections and unforeseen Project
expenses. The HCLC also approved an extension until December 31, 2006 of the deadline to acquire
the Project Certificate of Occupancy, and an extension of the Project's completion deadline from June
30, 2006 to December 31, 2007; and
WHEREAS, on December 19, 2006, the HCLC agreed to modify the HOME Loan requirements
to allow for units to close with a Temporary Certificate of Occupancy ("TCO") in order to reduce the
amount of interest payments on the SunTrust construction loan, and to extend the deadline to acquire
the Project Certificate of Occupancy from December 31, 2006 to May 31, 2007; and
WHEREAS, on July 27, 2007, the HCLC approved: (1) another extension, from May 31, 2007
to December 31, 2007, to acquire the Project Certificate of Occupancy, (2) an extension of the Project
completion deadline from December 31, 2007 to April 30, 2008, to account for unforeseen setbacks
with the general contractor, Zurqui Construction, and (3) an increase in the sales price of the Model
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File Number: 08-00609
B-1 units, from $195,000 to $209,000, and Model A-3 units from, $174,000 to $190,000; and
WHEREAS, in January, 2008, SunTrust informed the Department of Community Development
that it would declare a Project default if the following conditions were not met:
1. The City of Miami approve additional funding to include funds to complete the Project and pay
interest on the SunTrust loan for the months of February, March, and April 2008;
2. The developer and contractor obtain a TCO during February 2008;
3. The developer fully submit buyers ready to purchase Project units in such a number that
SunTrust deemed sufficient; and
4. The developer pay for the Project general liability insurance premium from January 26, 2008 to
January 26, 2009, in the sum of $2,901.84; and
WHEREAS, on February 11, 2008, the Department of Community Development met with
Miami -Dade County to discuss how to bring said the Project to completion; and
WHEREAS, on February 22, 2008, the HCLC approved additional Project funding in the amount
of $417,789.00, and deferred the consideration of payment for project manager fees to a future
meeting pending the developer's submission to the HCLC of additional information; and
WHEREAS, in March, 2008, SunTrust declared its senior construction loan to be in default and
indicated its intention to initiate foreclosure on the Project; and
WHEREAS, on March 31, 2008, the City and Miami -Dade County submitted a proposal to
SunTrust that would have resulted in the payment of the SunTrust Loan by July 31, 2008, which
proposal was rejected by SunTrust; and
WHEREAS, on April 30, 2008, the City, Miami -Dade County and SunTrust reached tentative
agreement by which the City would purchase the SunTrust senior construction loan under the
conditions set forth in Exhibit "C" attached and incorporated; and
WHEREAS, the Administration recommends the allocation of CDBG funds, in the amount of
$3,000,000, from the City's CDBG Housing Reserve to Model Housing Cooperative, Inc., as specified
in Exhibit "A", attached and incorporated, for the purchase of the SunTrust Bank senior construction
loan for the Villas Dr. Godoy Project located at 1455-1479 West Flagler Street, Miami, Florida, legally
described in Exhibit "B", attached and incorporated; and
WHEREAS, the Administration also recommends that the purchase of the SunTrust loan for the
Project be substantially on the terms stated in Exhibit "C" attached and incorporated; and
WHEREAS, it is the intent of the Administration to utilize the CDBG funds for the construction of
permanent residential structures which, upon completion, will be occupied by low- and
moderate -income households;
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 adopted by
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File Number: 08-00609
reference and incorporated as if fully set forth in this Section.
Section 2. The allocation of CDBG funds, in the amount of $3,000,000, from the City's
Department of Community Development CDBG Housing Reserve to Model Housing Cooperative, Inc.,
as specified in Exhibit "A", attached and incorporated, for the purchase of the SunTrust Bank senior
construction loan for the Villas Dr. Godoy Project located at 1455-1479 West Flagler Street, Miami,
Florida, as legally described in Exhibit "B", attached and incorporated, is authorized.
Section 3. The purchase of the SunTrust senior construction loan for the Project shall be
substantially on the terms stated in Exhibit "C", attached and incorporated.
Section 4. The City Manager is authorized {1 } to execute all necessary documents for said
purpose.
Section 5. This Resolution shall become effective immediately upon its adoption and signature of
the Mayor. {2}
APPROVED AS TO FORM AND CORRECTNESS:
JULIE O. BRU
CITY ATTORNEY
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Footnotes:
{1} 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.
{2} If the Mayor does not sign this Resolution, it shall become effective at the end of ten (10) calendar
days from the date it was passed and adopted. If the Mayor vetoes this Resolution, it shall become
effective immediately upon override of the veto by the City Commission.
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