HomeMy WebLinkAboutCity Issued Bonds ($8,165,000) financing for Warner Avenue A.r�
Submitted to:
REQUEST FOR CITY COUNCIL ACTION
ED 90-13
Honorable Mayor and City Council Members
Date May 7, 1990
Submitted by: Michael T. Uberuaga, City Administrator A O
Prepared by: Pat Spencer, Director of Housing and Redevelop
Subject: APPROVAL OF SALE - HARBOR GATEWAY APARTMENTS
&-I) .
Consistent with Council Policy?] Yes [ ] New Policy or Exception
Statement of Issue, Recommendation, Analysis, Funding Source, Alternative Actions, Attachme`&: "
STATEMENT OF ISSUE:
The Harbor Gateway Apartments (previously known as Warner Avenue Apartments) is
in escrow for sale. By virtue of the bond financing on this project it is necessary for
the city to consent to the change of ownership
RECOMMENDATION:
Approve and authorize the City Clerk to execute the attached resolution which
approves a Development Agreement Amendment and Assumption Agreement and
consents to the transfer of ownership and authorizes the appropriate city officials to
execute the necessary documents.
ANALYSIS:
The City issued bonds in the amount of $8,165,000 in 1985 to provide financing for the
project then known as Warner Avenue Apartments. The owner of the project, Lincoln
Properties of Huntington Beach, has negotiated the sale of the project to a new owner
and this transaction is currently pending in escrow. By virtue of the bond financing of
the project it is required that the city consent to the transfer of ownership. Harbor
Gateway is located at 4691 Warner Avenue (near Algonquin).
It is important to note that the new owner assumes all of the obligations imposed upon
the project's original owners, including the provision of twenty percent of the project
as affordable to lower income households. The Assumption Agreement attached will
bind the buyer to upholding these requirements (see Section 1 C p. 4 which references
the Regulatory Agreement within which the original affordability restrictions were
included.
The documents to be approved by the attached resolution are on file in the City Clerk's
office in substantial final form. No public hearing is required for the approval of the
transfer of ownership.
FUNDING SOURCE:
Any out of pocket expenses incurred by the city in the approval of the transfer of
ownership for the Harbor Gateway project will be paid by the project owner.
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his designee is hereby authorized for and in the name and on behalf
of the City to execute and deliver the forms of consent and release
by the City contained therein in such form, or with such changes or
modifications therein as the City Administrator or his designee may
with the approval of the City Attorney approve, such approval to be
conclusively evidenced by the execution and delivery of such
consents and releases by such officer, and to cause the Assumption
Agreements as so executed and delivered to be recorded, at the sole
expense of the Owner, in the Official Records of Orange County,
California.
3. Further Actions. The City Administrator or his designee
are hereby authorized and directed to take all further actions as
they may deem appropriate for carrying out the purposes of this
resolution.
4. Effectiveness. This resolution shall take effect
immediately upon its adoption.
PASSED AND ADOPTED on this day of
1990, by the
City Council of this City of Huntington Beach, State of California.
ATTEST:
City Clerk
REVIEWED AND APPROVED:
City Administrator
Mayor
APPROVED AS TO FORM:
4),
City Attorney 0,41
INITIATD-AND APPROVE
fEl—Dire4b of \Kconomic
—111 Deve�o ment
I�
IN WITNESS WHE OF, the parties hereto ha caused this
Administration Agreement to be executed on their behalf by their duly
authorized representatives, all as of the date hereinabove written.
THE BANK OF CALIFORNIA, N.A., WARNER PARTNERSHIP I,
as Administrator A CALIF. LTD. PARTNERSHIP
By; /� By: LINCOLN PROPERTY CO. NO. 1225,
Juanita F. Berg an, A 0 A CALIFORNIA LTD. PARTNERSHIP
Program Administrator as general partner
ACCEPTED AND AGREED TO BY:
MERCANTILE CAPITAL CORP.,
Mortgage Lender
By:
President -
By:
Managing General Partner
Mayor
ATTEST: APPROVED AS TO FORM:
City Clerk C' y attorney
REVIEWS AND APPROVED: INITIAT AND APPROVED:
CitytA-dmZinis1§Lr&-tor uty Ci Administrator
Deputy
GvL puty D' ector Redevelopment
1111-'
MPMLIN10
50
REQUEI� FOR CITY COUNCIPACTION
• RH 86-61
Date August 8. 1986
Submitted to: Honorable Mayor and City Council Members
Submitted by: Charles W. Thompson, City Administrato GU NGIL
Y GITY
Prepared by: Douglas N. LaBelle, Deputy City Administrator/Redev � �CW_
Subject: ADMINISTRATION/DEVELOPMENT AGREEMENTS -
WARNER AVENUE APARTMENTS
CITY C�
Consistent with Council Policy? Yes [ ] New Policy or Exceptio
Statement of Issue, Recommendation, Analysis, Funding Source, Alternative Actions, Attachments:
STATEMENT OF ISSUE:
The restrictions of tax exempt financing and entitlement approvals for the Warner
Avenue Apartments project require provision of 30% of the units as affordable. The
attached agreements provide the mechanism for monitoring and compliance with these
requirements.
RECOMMENDATION:
Approve and authorize the Clerk to execute the attached Administration Agreement
and Development Agreement between the city, the Bank of California (as
Administrator), and Warner Partnership I (project owner).
ANALYSIS:
The 102 unit Warner Avenue Apartment project was the subject of a tax exempt
financing which closed in October 1985. The Internal Revenue Code of that time
required that 20% of the units in this project be set aside for low income households. It
was also a city imposed requirement in the documents for this financing that the
developer hire, at its own expense, a "Program Administrator." The Program
Administrator's function is to oversee compliance with all affordability restrictions for
the term of such restrictions. The Administrator will report to the city should any
irregularities occur.
In cooperation, the project owner and staff have reviewed the credentials of firms
which would provide such Program Administrator services. The recommendation of the
Bank of California is based on the firm's credentials and a competitive fee quote.
Also, the entitlements for this project require an additional 10% of the units to be
restricted to moderate income households. However, as part of the entitlement
approval process no requirement for an independent Program Administrator to monitor
compliance with this 10% requirement was provided. Therefore, also attached is a
separate Development Agreement between the city and the developer which stipulates
that the additional 10% of units must be occupied by low and moderate income
households.
Plo 5/85