HomeMy WebLinkAbout1999-12-13 00-51 ORDERCOUNCIL ACTION
Date: December 13 1999
Item No. 010u,$1_
Item/eubject: Authorizing Amendment to Option Agreement for Purchase
and Development of Development Parcel Between Boyd and
Newbury Streets - Realty Resources Chartered
Responsible Department: Community & Economic Development
Boyd Sm at Housing Aboahues, LP has been formed by Realty Resources to consumer a 32 unit, multi -family,
affoNable housing pr ject on a City owned parcel of land located between Boyd Street and Newbury Streeq just
below St. John's Catholic Church. The Project is located in a City Council designated Community Development
project area, the Hancock -York Neighborhood Development Prgmi The project will have 16 two-bedroom units
and 16 thee -bedroom units for mat 0 low-income families, and a community center. The project will be fully
taxable, generating an estimated $28,800 in annual new tax revenues to the City.
Thecwtoftheprojsctisatimatedtobe$2,775,386. The Developer will invest$1,775,386 in equity, $400,000
in private Bouncing, and $400,030 in Maine State Housing Authority defamed loan funds. Due 0 the high cost of
building concoction, limited amomn of rents that can be charged residents, and the cost of the mmaunity
building and services provided, the developer has applied for$200,000 in financial assistance from the City. This
amendment would provide a $0,000 lines to Boyd Street Housing Associates fiom the proceeds from the sale of
theproperty. The amendment would also provide a mum of a portion ofnew Mal estate taxes paid lathe City of
Bangor each year on the projxt in an amount sufficient to amonze a loan of $140,0000 the developer fiom a
Private lender, at a rate notto exceed 95%end for a period not to exceed 15 years. The amendment would also
assign all rights of Realty Resources Chartered under the Option to Boyd Street Housing Assail iatess,,�LP.
aceminent NEa
Manager's constants: [t{ (t Jn
C+4DMbmmu�sea.Valas, (i
City Manager
Associated Information L),rhaal
Budget
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Approval:
Finance
Director
CITY Solicitor
Introduced For XPassage 0 First Reading 0 Referral
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Awipied to Centaur eohmau Beceober 13, 1999
- CITY OF BANGOR
(TUTEE.) Orber,_ANpnzing A,mv, mmtto Opauu Agreementfgr Purchase and .......
DevelopmentofDevelopment Parcel Between Boyd and Newbury
Strdts Realty Resowces Chartered
BY eM City Gouwait offAe thh of Wnpor:
OWER10 ,
TWT WHEREAS, the City entered rate an Option Agrcanent for Purchase and
Development oflkvOopment Parcel Between Boyd and Newbury Surdas with Realty
Resources Chartered dated February 25, 1999 approved by passage of Council Order
99-101 on February 22,1999; and
WHEREAS, an amendment to the Option was approved by passage of
Conrail Order 99-29lextendhrg its term or February 28, 2000; and
WHEREAS, the Opfion provides for are development of a 32 unit, could -
hardly, affordable housing project on a City owned parcel of land located between Boyd
Street and Newbury Street, below St. John's Catholic Church; and
WfIEREAS, Realty Resources Chartered has formed a limited partnership,
Boyd Street Housing Associates, LP, to carry, out the development, and
WHEREAS, Boyd Street Housing Associates, LP has requested Randal
assistance front the City to curry out the project;
NOW, THEREFORE, BE IT ORDERED BY THE CITY COUNCIL
OF THE CITY OF BANGOR THAT the City Manager is hereby authorized to execute
an amendment to the Option Agreemenu for Purchase Bud Development of Development
Parcel Between Boyd and Newbury Streets with Realty Resources Chartered dated
February 25,1999, providing for a $60,000 ken tc Boyd Street Housing Associates from
the proceeds from the sale of the property, a return of a portion of new real estate taxes
paid to the City of Bangor each year on the project in an amount sufficienuo amortize a
loan of $140,000 to the developer from a private Border, at arate not to exceed 9.5% and
for a period not to exceed 15 years, assigning all rights of Realty Resources Charlaed
under the Option on Boyd Street Housing Associates, LP, and other amerMments
substantially as attached hereto, and in a fatal form as approved by the City Solicitor or
Assistant City Solicitor.
IP CITY CDmm
December 13.-1999
Notiam for Pessege Mde and Becooded
Passu
0031
ORDER
Title, Authorizing Amendment to Option
Agreement for A¢[base and Development
f Developeemt Parcel Betveea Bold and
Neeb'eiy 5Cceeie - %'aYCy 1e"souice'i
Chartered
......................................
-0
i
Councilmen
AMENDMENT TO THE OPTION AGREEMENT FOR PURCHASE AND
DEVELOPMENT OF DEVELOPMENT PARCEL BETWEEN BOYD AND NEWBURY
STREETS BY AND BETWEEN THE CITY OF BANGOR AND REALTY RESOURCES
CHARTERED
Agreement made this_ day of December 1999.
WITNESSETH
WHEREAS, the City of Bangor and Realty Resources Chartered entered into m Option
Agreement for Purchase and Development of Development Parcel Between Boyd and Newbury
Streets dated Febmary 25,1999 (heremade "Option); and
WHEREAS, Realty Resources Chartered, referred to in the Option as "Developer", has
formed a new developmem entity, Boyd Street Housing Associates, LP, b proceed with the
"Development" m refined b in the Option; and
WHEREAS, the Developer desires to construct a 32 unit, mulfi-family, affordable
housing project that will have 16 two bedroom units and 16 three bedroom units, on a City
owned parcel of land located between Boyd Street and Newbury Street, below St. John's
Carbolic Church; and
WHEREAS, the estimated cost of acquisition of property, building construction,
installation of equipment and furnishings, design fees, legal fees, insmmnce, financing and other
costs associated with the development (herehiafte"Project") is estimated to be $2,775,386; and
WHEREAS, Developer will invest not less then $1,9'15,386 in equity, will secure not less
than $400,000 in private financing, and will secure $400,000 in Maine Sta a Housing Authority
deferred loan funds for the Project; and
WHEREAS, Developer will construct a community building thaz will be used by
residents for social and occuyatioml activities; and
WHEREAS, the Project includes the acquisition of computers to be placed in the
community building for residents to use that will be networked and connected to the internet, the
model is HUD's Neighborhood Networks Program; and
WE[EREAS, completion of the Project will create a significant public benefit by
Providing affordable housing opportunities, removal of blighting conditions in the Hancock -York
Neighborhood Development Project area, and will significantly humming lire nor base of the
City; and
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WHEREAS, the high Post ofbuilding construction, limited rents that can be charged
residents, the community building and providing opportunities order the model of HUD's
Neighborhood Networks Program requires financial assistance from the City; and
WHEREAS, the Project is located in a City Council designated Community Development
project men, the Hancock -York Neighborhood Development Project;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants
contained in this Amendment, the City and Developer agree as follows:
I. The City agrees to an assignment by Realty Resources Chartered of all rights of
Realty Resources Chartered as "Developer" under the Option, and as amended
hereby, m Boyd Street Housing Associates, LP as "Developer"
2. Subject to the provisions of the Option and this Amendmem, the Developer agrees
to contract a 32 unit, multi -family housing project that will have 16 two bedroom
units and 16 three bedroom wits, with tents affordable to tenants meeting low to
moderate income guidelines established by the U. S. Department of Housing and
Urban Development, and to construct a community building, all in accordance
with the site plan for development of the Project approved by the Bangor Planning
Board on October 21, 1999, a copy of which in on file in the City of Bangor
Planning Office.
3. Developer agrees to invest not less than $1,775,386 in equity, secure not less than
$400,000 in private loan financing, secure $400,000 in deferred Maine State
Housing Authority loan funds for the Project, and will invest approximately
$2,]]5,386 for all costs associated with the Project, including not less than
$1,900,000 in actual balding construction, fivnishings and site development
costs.
4. Developer agrees he Provide evidence, not later than February 1, 2000 satisfactory
to City Solicitor of City, of binding construction contract, or oonhacts,
Providing for site work and building construction was for the Project of not less
than $1,900,000,
5. City agrees on transfer title of im development parcel described above to
Developer for a purchase price of $60,000 and to provide the Developer a loan in
the amount of not more than $60,000 for the purpose of providing a Portion of the
permanent fmancing of the Project.
6. City agrees to return a portion of annual real estate taxes paid on the project for up
toe15-yearperod. Theamountofrml esm[e [axes returned in anyyear shall not
exceed 100%ofreal estate faces paid, and shall not exceed the amount necessary
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to amortize a loan amount of $140,000, at an interest rate not to exceed 9.50/o, for
a term not to exceed 15 years, with not less than semiamual payments, and lunger
provided no portion of real estate takes paid the City by the project will be
retuned after Mach 31, 2016.
7. Developer agrees that development of the Project shall be in accordance with all
applicable Federal, State, and City laws, ordinances and building codes.
9. Develop r agrees the scope of the work shell conform in all material respects to
plans approved by the City of Bangor under Section B of the Option.
9. Developer agrees to provide evidence by February, 1, 2000, satisfactoryto City
Solicitor of City, of legally binding private lender financing commitments of
$540,000 fm financing of the Psojeet-
10. Developer agrees to provide evidence by February 1, 2000 satisfactory to City
Solicitor of City, of legally binding limited partner's capital investment and
general partner's capital investment of not less than $1,775,000, said investment
to support the financing of the Project.
11. Developer agrees b provide evidence by February 1, 2000, satisfacmryto City
Solicitor of City, of legally hinting Maine State Housing Awlimity defered
financing commitments of $400,000 for financing of the Project
12. Developer hereby acknowledges that the City, in agreeing to provide financial
assistance to Developer for the Project, relied in material part upon the assured
completion of the Project ant the Developer agrees ur use its best Plane to
substantially complete the Project no later thea March 1, 2001.
13. Developer agrees that it shall keep and maintain books, records and other
documents relating directly to the Project and agrees that any duly authorized
representative of the City shall, at all reasonable times, have access to and the
right to inspect, copy, audit and examine all such books, records and other
documents of Developer until completion of the Project upon prior written notice.
Developer shall aware that similar provisions are included in all contracts or
subcontracts entered into in connection with this Project.
14. Developer agrees that any duly autbortred representative of the City shall, at all
reasonable lives, have access to my portion of the Project until its completion
and apermaeat Occupancy Permit for the Project has been issued by the City.
15. Any notice which either party desmes or is required to give to the other in
connection with the Option, as amended, shall be in writing and shall be sent
postage prepaid, certified mail, mum receipt requested, as follows:
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If to City: Edward A. Barrett, City Manager
City of Bangor
73 Harlow Street
Brogan, Maine 04401
Ifto Developer: Boyd Street Housing Associates, LP
do Realty Resources Chartered
247 Commercial Street
Rockport, Maine 04856
Or such other person and/or address as may be identified in writing by the parties.
16. Except as provided in the Option as amended hereby, until substantial completion
of the Project, Developer shall not assign its rights order the Option without the
prior written consent of City, which consent shall not be unreasonably withheld,
delayed or conditioned. The City's obligations hereunder are contingent upon the
Developers compliance with the terms aM/or conditions set forth in the Option as
hereby amended.
17. It is intended by the parries that the Option, as hereby amended, shell operate as
contract order seal, in accordance with 14 MRSA Sec.751.
18. To the extent that this Amendment is inconsistent with the Option, the parties
agree to be bound by the terms and conditions of Us Amendment.
WITNESS WHEREOF this Amendment bas been executed, sealed and delivered in
duplicate counterparts as of the day and year first above written.
Boyd Street Housing Associates, LP
By JMC PaMers LLC, General Poorest
By
Joseph M. Cloutier
Its Managing Member
CRY OF BANGOR
By
Edward A. Barrett
Its City Manager
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