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HEDRA Memorandum
To: HEDRA Board Members
From: John Hinzman, Community Development Director
Melanie Lammers, Finance Manager
Date: March 14, 2019
Item: Authorize Signature: Amendment of Development Agreement and Reassignment of
TIF – Guardian Angels – CommonBond Communities
HEDRA Action Requested:
Authorize signature of an amendment to the Development Agreement between the
Hastings HRA and Guardian Angels of Hastings Limited Partnership. The amendment is
requested due to a planned transfer of the property between the original developer
(Sherman Associates) and CommonBond Communities, and includes the following
provision:
Assignment of remaining Tax Increment Financing (TIF) to the new Limited
Partnership established by CommonBond Communities.
Assumption of an existing HRA Loan with a balance of $30,858 to the new
Limited Partnership established by CommonBond Communities. Document to be
sent under a separate cover.
Background Information:
The original Development Agreement was executed in 2000 for the redevelopment of the
former Guardian Angels Church and School located at 208 East 4th Street by Sherman
Associates. The project included the establishment of a TIF District and the issuance of a
loan by the former Hastings Housing and Redevelopment Authority (HRA). All former
obligations of the HRA were assumed by HEDRA upon its creation in 2009.
CommonBond plans to conduct a substantial rehabilitation of the apartment units and
townhomes including the conversion of a long vacant former daycare space in the
basement of the apartment building into additional apartment units. Please see the
attached construction narrative for further information.
Financial Impact:
The outstanding loan from HEDRA will be repaid. No other financial impact to HEDRA.
Attachments:
Construction Narrative
Assignment and Assumption of Development Agreement
Allonge Endorsement to TIF Note
February 4, 2019
RE: Guardian Angels Apartments and Townhomes
Construction Narrative
Guardian Angels Apartments and Townhomes is an existing housing tax credit
property that was initially developed in 2001. The property is a critical affordable
housing resource for the City of Hastings and the larger community, with highly
affordable rents serving a resident base whose average income is 31% of the area
median income.
The property is, however, in need of a comprehensive recapitalization in order to
address physical needs and restructure the existing financing. The rehab scope of
work will include the replacement of numerous building systems and the conversion of
an existing vacant commercial space into three additional affordable apartments. The
addition of these revenue producing units is expected to substantively improve the
financial performance of the property.
The construction scope of work for the converted school building (current apartments),
includes:
Adding 3 new units at currently vacant commercial space
Replacing sidewalks
Patching/repairing parking lot
Tuck pointing exterior façade
Replacing the flat roof
Refurbishing existing windows
Modernizing the elevator
Upgrading kitchen cabinets/counters/faucets
Replacing bath vanities/faucets/toilets
Replacing unit flooring
Painting units
Replacing boilers
Adding cameras and replacing light fixtures
The scope of work for the existing two townhomes buildings, includes:
Replacing sidewalks
Replacing siding
Replacing roofing
Replacing windows
Replacing entry doors
Upgrading kitchen cabinets/tops/faucets
Replacing bath vanities/tops/faucets/toilet
Replacing bath fans
Painting entire unit/living space
Adding cameras and replacing light fixtures
1
ASSIGNMENT AND ASSUMPTION OF DEVELOPMENT AGREEMENT AND
ASSIGNMENT OF TAX INCREMENT REVENUE NOTE
THIS ASSIGNMENT AND ASSUMPTION OF DEVELOPMENT AGREEMENT
AND ASSIGNMENT OF TAX INCREMENT REVENUE NOTE (this “Agreement”) is dated
as of __________, 2019 (the “Effective Date”) and is by and between GUARDIAN ANGELS
OF HASTINGS LIMITED PARTNERSHIP, a Minnesota limited partnership (“Assignor”) and
CB GUARDIAN ANGELS HOLDING LLC, a Minnesota limited liability company
(“Assignee”).
RECITALS
A. Assignor, as developer, and the Hastings Housing and Redevelopment Authority, a
public body corporate and politic under the laws of the State of Minnesota (the “Authority”)
entered into that certain Development Agreement dated as of December 21, 2000, as amended by
that certain First Amendment to Development Agreement dated December 14, 2001, executed by
the Authority and the Assignor (collectively, the “Development Agreement”), pursuant to which
Assignor constructed a multifamily housing project located on the real property legally described
on Exhibit A attached hereto and made a part hereof (the “Property”).
B. Pursuant to the terms and subject to the conditions of the Development Agreement,
the Authority executed and delivered to the Assignor that certain Taxable Limited Revenue Tax
Increment Note dated as of June 14, 2001, in the original principal amount of $484,000.00, as
endorsed to Minnesota Housing Finance Agency by that certain Allonge Endorsement dated
December 14, 2001 (the “TIF Note”).
C. Assignor has agreed to sell to Assignee and Assignee has agreed to purchase the
Property from Assignor.
D. Subject to the terms and conditions of this Agreement, Assignor shall assign to
Assignee and Assignee shall assume from Assignor, certain rights, obligations and liabilities of
Assignor under the Development Agreement and Assignor shall assign and transfer to Assignee
the TIF Note.
AGREEMENT
NOW, THEREFORE, in consideration of mutual promises and of other good and
valuable consideration each party hereto acknowledges, the parties hereby agree as follows:
2
1. Definitions. Any capitalized term used but not defined herein shall have the
meaning given such term in the Development Agreement.
2. Assignment. Assignor does hereby assign, transfer and convey to Assignee all of
Assignor’s right, title, and interest in and to the Development Agreement together with all of
Assignor’s obligations and liabilities associated therewith accruing from and after the Effective
Date.
3. Assumption. Assignee does hereby accept such assignment, and assumes all of
Assignor’s right, title, and interest in and to the Development Agreement together with all of
Assignor’s obligations and liabilities associated therewith accruing from and after the Effective
Date.
4. Indemnification. Assignor shall indemnify and hold harmless Assignee from and
against all obligations of the Assignor under the Development Agreement to the extent such
obligations were applicable to the period and required to be performed prior to the Effective Date.
Assignee shall indemnify and hold harmless Assignor from and against all obligations assumed by
the Assignee under the Development Agreement to the extent that such obligations are applicable
to the period and required to be performed from and after the Effective Date.
5. Assignment of TIF Note. Concurrent with the execution of this Agreement, the
Assignor has delivered and surrendered the original TIF Note to the Assignee.
6. Governing Law; Successors and Assigns. This Agreement shall be construed and
enforced in accordance with the laws of the State of Minnesota.
7. Counterparts. This Agreement may be executed in any number of counterparts,
and each such counterpart hereof shall be deemed to be an original instrument, but all of such
counterparts together shall constitute but one agreement.
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Assignor and Assignee have caused this Assignment and Assumption of Contract for
Private Redevelopment and Assignment of Tax Increment Revenue Note to be signed on the
Effective Date.
ASSIGNOR:
GUARDIAN ANGELS OF HASTINGS LIMITED
PARTNERSHIP,
a Minnesota limited partnership
By:
Name:
Title:
STATE OF MINNESOTA )
) SS.
COUNTY OF __________ )
The foregoing instrument was acknowledged before me this ____ day of_____________,
2019, by ______________________, the ______________________ of Guardian Angels of
Hastings Limited Partners, a Minnesota limited partnership, on behalf of the company.
____________________________________
Notary Public
ASSIGNEE:
CB GUARDIAN ANGELS HOLDING LLC,
a Minnesota limited liability company
By:
Name: Cecile Bedor
Title: Chief Manager
STATE OF MINNESOTA )
) SS.
COUNTY OF RAMSEY )
The foregoing instrument was acknowledged before me this ____ day of_____________,
2019, by Cecile Bedor the Chief Manager of CB GUARDIAN ANGELS HOLDING LLC, a
Minnesota limited liability company, on behalf of the company.
____________________________________
Notary Public
This Instrument Drafted By:
Winthrop & Weinstine, P.A.
225 South Sixth Street
Suite 3500
Minneapolis, MN 55402
The Authority hereby consents and agrees to this Assignment and Assumption of
Development Agreement and Assignment of Tax Increment Revenue Note.
AUTHORITY:
HASTINGS ECONOMIC DEVELOPMENT AND
REDEVELOPMENT AUTHORITY, a public body
corporate and politic under the laws of the State of
Minnesota
By:
Name:
Title:
STATE OF MINNESOTA )
) SS.
COUNTY OF )
The foregoing instrument was acknowledged before me this ____ day of_____________,
2019, by the of HASTINGS ECONOMIC
DEVELOPMENT AND REDEVELOPMENT AUTHORITY, a public body corporate and politic
under the laws of the State of Minnesota, on behalf of the company.
____________________________________
Notary Public
EXHIBIT A
Description of the Property
Lot 1, Block 1, Guardian Angels Addition, according to the recorded plat thereof, City of
Hastings, Dakota County, Minnesota.
Together with the benefits and easements created in Easement Agreement dated December 14,
2001, recorded January 22, 2002, as Document No. 1853833, by and among Guardian Angels of
Hastings Limited Partnership, Guardian Angels of Hastings Transitional housing LLC and
Guardian Angels of Hastings Community Center LLC, as amended by Amendment of Easement
Agreement dated December 22, 2014, recorded December 23, 2014, as Document No. 3044308.
ALLONGE ENDORSEMENT TO
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF HASTINGS, MINNESOTA
TAXABLE LIMITED REVENUE TAX INCREMENT NOTE
(GUARDIAN ANGELS PROJECT)
FOR VALUE RECEIVED, CB Guardian Angels Holding LLC, a Minnesota limited liability
company, endorses, assigns and transfers to the Minnesota Housing Finance Agency, a public body
corporate and politic of the State of Minnesota, all right, title and interest in and to the following
described Note:
Housing and Redevelopment Authority In and For the City of Hastings, Minnesota Taxable
Limited Revenue Tax Increment Note (Guardian Angels Project), in the original principal amount of
$484,000.00, dated June 14, 2001, executed by the Housing and Redevelopment Authority In and For
the City of Hastings, Minnesota, as maker, to Guardian Angels of Hastings Limited Partnership, a
Minnesota limited partnership, as holder, as assigned to CB Guardian Angels Holding LLC, by that
certain Assignment and Assumption of Development Agreement and Assignment of Tax increment
Revenue Note dated as of _________________, 2019.
Dated at Saint Paul, Minnesota, this day of , 2019.
THIS ALLONGE IS TO BE AFFIXED
TO THE NOTE DESCRIBED ABOVE
CB GUARDIAN ANGELS HOLDING LLC,
a Minnesota limited liability company
By:
Cecile Bedor
Its: Chief Manager
CONSENTED AND AGREED TO BY:
HASTINGS ECONOMIC DEVELOPMENT AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF HASTINGS, MINNESOTA
By: ______________________________
By: ______________________________
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