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HomeMy WebLinkAbout2021-02-22 21-103 Order 02/22/202121-103 02/22/2021 21-103 Community & Economic Development Order 042-188 Title, Order Authorizing Execution of a Development Agreement and Credit Enhancement Agreement with Arey's Cove Real Estate, LLC, for Property at 2 Hammond Street This order will authorize the execution of a Development Agreement and Credit Enhancement Agreement with Arey's Cove Real Estate, LLC for property located at 2 Hammond Street. 2 Hammond Street is being renovated for a mixed use development consisting of commercial space on the first floor and 8 residential units on the upper floors. The level of investment required for rehabilitation of the property is not economically feasible without assistance from the City. This assistance can be provided through an agreement with the developer to return 50% of the increase in real estate taxes paid on the increase in value created by the improvements to the property for a period of two (2) years. If approved, this order will authorize the City to enter into Agreements with Cressey, Butler & Cohen, LLC, under the following terms: The developer will invest $1.375 million of private funding and equity in the development project; the City will return to the developer 50% of the real estate taxes paid on the increased valuation of property located at 2 Hammond Street as a result of the investment in the property for a period of two (2) years; the developer will substantially complete the project by June 30, 2022; the project shall be for commercial use on the street level and residential use on the upper floors; and such other terms and conditions as appropriate. Historic Preservation Commission 02/16/2021 Recommend for passage 50 New Business 02/22/202121-103 CITY OF BANGOR ORDER 02/22/2021 21-103 Dubay Authorizing Execution of a Development Agreement and Credit Enhancement Agreement with Arey's Cove Real Estate, LLC, for Property at 2 Hammond Street WHEREAS, the City of Bangor supports new investment and the creation of additional commercial and residential space in its downtown area; and WHEREAS, 2 Hammond Street has been acquired by Arey's Cove Real Estate, LLC with plans to renovate the property retaining the commercial space on the street level and creating residential units on the upper levels; and WHEREAS, 2 Hammond Street is underutilized, with the upper floors long vacant, and the developer's renovation of the property will result in substantial increase of the property taxes on the building and land; and WHEREAS, the investment required for rehabilitation of the property is not economically feasible without assistance; and WHEREAS, the assistance necessary can be provided through entering a credit enhancement agreement with Arey's Cove Real Estate, LLC, to provide the return of 50% of real estate taxes paid on the increase in value created by the improvements to the property for a period of two (2) years: BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR THAT: The City Manager is hereby authorized to enter into Agreements with Arey's Cove Real Estate, LLC, which will include the following terms: a return to Arey's Cove Real Estate, LLC 50% of the real estate taxes paid on the increase in the value of property located at 2 Hammond Street as a result of the development of the property for a period of two (2) years; $1.375 million of private funding and equity in the development project; project to be completed by June 30, 2022; the project shall be for commercial and residential uses; and such other terms and conditions as appropriate and the Agreements shall be in a final form approved by the City Solicitor or Assistant City Solicitor. IN CITY COUNCIL FEBRUARY 22,2021 CO 21-103 Motion made and seconded for Passage Vote: 9—0 Councilors Voting Yes: Davitt,Dubay,Fournier,Hawes,Nichols, Okafor, Schaefer, Sprague,Tremble Councilors Voting No: None Passed ,- — , --� J, z�-, . CITY LERK