RES 2018-0737 - Agmt with Fullwood Square Apartments LP amendment Planning Department
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David K.Fanslau
City of Omaha C C 1 S;i�� Director
Jean Stothert,Mayor i .l� . � # � ry r. t
August 7, 2018
Honorable President
And Members of the City Council,
The original Agreement between the City of Omaha and Fullwood Square Apartments Limited
Partnership, a Nebraska Limited Partnership, General Partner: Venture Development Group,
Inc., a Nebraska Corporation, ("VDG"), David E. Mackie, President, 4852 South 133rd Street,
Suite 107, Omaha, Nebraska 68137 to fund this project located at 1920 Willis Avenue, Omaha,
Nebraska, was executed and approved by the City Council on September 11, 2001 using FY
2001 HOME Investment Partnerships Program ("HOME") funds by Resolution No. 2277.
The original Agreement provided partial financing for the Partnership to rehabilitate the vacant
Fullwood School located at 1920 Willis Avenue into 10 affordable housing units of which all 10
rehabilitation units would be assisted with HOME funds and would be made affordable to
qualified low- and moderate-income families whose household annual incomes are at or below
80% of the Median Income by Family Size. Further, the original Agreement provided that the
Partnership would construct 12 non-HOME assisted townhomes on the site.
The First Amended Agreement approved a substitution of the General Partner and an
assignment of all rights and responsibilities of the original Agreement to the new General
Partner, Fullwood Square Corporation, a Nebraska Corporation and wholly-owned by New
Community Development Corporation as approved by Resolution No. 1416 on June 18, 2002.
The Second Amended Agreement approved an increase in the rehabilitation cost from
$1,209,675.00 to $1,397,350.00. The Partnership has requested and received an additional
$125,000.00 allocation of HOME funds to complete the Project. These funds were authorized
through an Amendment to the FY 2001 Consolidated Plan approved by the City Council on
August 13, 2002 by Resolution No. 1767. This allocation increased the HOME Program funds
for this Project to $400,000.00. Other funding sources consist of $672,350.00 in Low Income
Housing Tax Credits, $150,000.00 in Tax Increment Financing (TIF), and a $175,000.00 Bank
Loan, as approved by Resolution No. 2374 on October 22, 2002.
The Third Amended Agreement approved an Amendment to the repayable loan Promissory
Note to forgive the accrued interest of $323,440.00 and the rate of 5.39% for the remaining term
of the loan and reduce the interest to 0%. Commencing January 1, 2017, no further interest
shall accrue on principal balance, and payment on the principal balance reduced to present
value of$149,760.00shall be deferred until January 1, 2019, and then, commencing on January
1, 2019, begin amortizing over an additional 15 years in 180 equal monthly installments in the
amount of$832.00, as approved by Resolution No. 510 on April 18, 2017.
Honorable President
and Members of the City Council
Page 2
This Amendment is made and entered into by and between the City of Omaha (hereinafter
referred to as "City") and Fullwood Square Corporation, a Nebraska Corporation (hereinafter
referred to as "Assignor") in order to assign the loan responsibilities to a new Assignee and to
adjust terms of the Repayable Loan.
This Amendment: 1) modifies the statement in the loan terms that reads; "Accrued interest of
$323,440.00 is forgiven commencing January 1, 2017..." to read: "Accrued interest of
$323,440.00 is forgiven, along with the reduction of the principal from $400,000.00 to
$149,760.00, effective January 1, 2018..." and 2) authorizes the Mayor to execute the
documents necessary to facilitate the transfer of property and assignment of rights and
obligations related to the Agreement between the City and Fullwood Square Apartments LP
approved on September 11, 2000 by Resolution No. 2277 and as amended to Fullwood Square
I, LLC, a Nebraska Limited Liability Corporation wholly-owned by New Community Development
Corporation, a Non-Profit Corporation.
Approval of the attached Consent to Assignment and the Consent to the Transfer of Interest and
Assignment will provide for the City's consent to the transfer, and assign, to facilitate the Limited
Partnership's compliance with the terms of the tax credit agreement and insure the project will
continue to provide affordable rental housing under the terms of the original Agreement.
We urge your favorable consideration of this Resolution.
Respectfully submitted, Referred to City Council for Consideration:
J'•• " VA 11' % �5 tA. ` I
David K. Fanslau Date Mayor's Office Date
Planning Director
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RECITALS: •
WHEREAS, the City of Omaha is a Municipal Corporation, located in Douglas
County, Nebraska, organized and existing under the laws of the State of Nebraska, and is
authorized and empowered to exercise all powers conferred by the State Constitution, State
Laws, the Home Rule. Charter of the City of Omaha, 1956, as amended, and municipal
ordinances, including, but not limited to, the power to contract; and,
WHEREAS, on September 11, 2001, a Loan Agreement (hereinafter referred to
as "Agreement") between the City of Omaha (hereinafter referred to as "City") and Fullwood
Square Apartments Limited Partnership, a Nebraska Limited Partnership, General partner:
Venture Development Group, Inc., a Nebraska Corporation, David E. Mackie, President, 4852
South 133rd Street, Suite 107, Omaha, Nebraska 68137 (hereinafter referred to as "Owner")
was approved by the City Council on September 11, 2001, Resolution No. 1416; as amended
on October 22, 2002 by Resolution No. 2374; and as amended by Resolution No. 510 on April
18, 2017; and,
WHEREAS, the terms of the original Agreement provided for the partial financing
to rehabilitate the vacant Fullwood School located at 1920 Willis Avenue into 10 affordable
housing units. All 10 rehabilitated units would be assisted with HOME funds and would be
made affordable to qualified low- and moderate-income families whose household annual
incomes are at or below 80% of the Median Income by Family .Size. The original Agreement
provided that the Partnership would construct 12 non-HOME assisted townhomes on the site;
and,
WHEREAS, the Developer's above-described indebtedness to the City is
secured by a Deed of Trust and Promissory Note, which security interest was perfected on
October 11, 2001, upon the filing of same with the Douglas County Register of Deeds, same
being recorded on October 12, 2001, in Mortgage Book 6735 at Page 124; and,
WHEREAS, the original General Partner resigned due to lack of financial
capacity for the Project and has requested to assign its responsibilities to a new General
Partner, Fullwood Square Corporation, a Nebraska Corporation and wholly-owned subsidiary of
New Community Development Corporation, authorized by Resolution No. 1416 approved on
June 18, 2002; and,
•
WHEREAS, in the original Agreement, the rehabilitation financing was
$275,000.00 in HOME funds with an amendment to increase the funding to $400,000.00
authorized by Resolution No. 2374 approved on October 22, 2002; and,
WHEREAS, the Owner has requested that the City modify the repayment terms
of its loan to read, "accrued interest of $323,440.00, along with the reduction of principle from
$400,000.00 to $149,760.00, is forgiven and reduced effective January 1, 2018; and,
WHEREAS, this Amendment authorizes the Mayor to execute a Consent
Assignment and a Consent to the Transfer of Interest and Assignment from Fullwood Square
Apartments LP to Fullwood Square I, LLC, a Nebraska Limited Liability Corporation wholly-
owned by New Community Development Corporation, a non-profit organization d/b/a
NeighborWorks Home Solutions; and,
•
WHEREAS, this Amendment adopts all of the terms and conditions of the
Agreement approved on September 11, 2001, by Resolution No. 2277, and as amended to the
extent that said terms and conditions are not inconsistent with the terms and conditions of this
Amended Agreement; and,
WHEREAS, it is in the best interests of the City of Omaha and the residents
thereof that the City enter into this Amendment to continue this worthwhile affordable housing
Project.
NOW, THEREFORE, IN CONSIDERATION OF THESE MUTUAL COVENANTS,
HEREIN CONTAINED, THE PARTIES HERETO AGREE AS FOLLOWS:
1. Developer shall execute for the benefit of the City an amended Deed of Trust and
deferred payment loan non-recourse Promissory Note in an amount not to exceed
$149,760.00 (representing reduced principle as approved by Resolution No. 510 on
April 18, 2017), plus accrued interest, secured by no less than a third lien position. A
copy of the Promissory Note in substantial form is attached hereto as Exhibit "B".
2. The LLC agrees to execute an Amended Promissory Note, in a form similar to the
document attached hereto as Exhibit "B" to reflect the amended repayment terms.
3. This Amendment adopts all of the terms and conditions of the Agreement approved
on September 11, 2001, by Resolution No. 2277, and as amended to the extent that
said terms and conditions are not inconsistent with the terms and conditions of this
Amended Agreement.
4. This Amendment embodies the entire agreement of the parties as to the subject
matter addressed herein. This Amended Agreement may only be amended, in
writing, and executed by all of the parties hereto.
5. Each party represents to the other parties that is has the necessary authority to enter
into this Amendment (Exhibit "A").
6. This Amendment may not be assigned by any party without the written consent of
the other parties hereto.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
last written below.
ATTEST: CITY OF OMAHA, a Municipal Corporation
in Douglas County, Nebraska
���/S� l�118J
City Jerk City of Omaha Date MAYOR OF THE CITY OF OMAHA Date
Fullwood Square I, LLC, a Nebraska Limited
Liability Corporation:
•
BY: New Community Development Corporation,
a Non-Profit Corporation d/b/a
NeighborWorks Home Solutions
WITNESS: By: D 7/7"/P/yZeteli)i
Marvin Kieckhafer Date
7 /7 _o/ President
Si ature Date
APPROVED AS TO FORM:
74/ DO...JUZ.Ygdi e
ASSISTANT CITY ATTORNEY Date
2659 dlh
CONSENT TO ASSIGNMENT
i I 1 fe
In regards t he property located at /gat �t11 I l iAVtnZU_._ , and pursuant to
Section of the Agreement between the City of Omaha and the Fullwood Square
Apartments Limited Partnership, a Nebraska Limited Partnership, approved on September 11,
2001, by Resolution No. 2277, the undersigned Mayor of the City of Omaha does hereby
consent to the assignment of all rights and obligations to Fullwood Square I, LLC, a Nebraska
Limited Liability Corporation, wholly-owned by New Community Development Corporation, a
Non-Profit Corporation.
/41 WITNESS WHEREOF, this Con ent has been executed by the undersigned this
9 day of ,4-V9(151 , 20 1
ATTEST: CITY OF OMAHA, a Municipal Corporation
1/1
City CI rk of#City of Omaha Date MAYOR OF THE CITY OF OMAHA Date
ACKNOWLEDGMENT
STATE OF NEBRASKA )
) SS.
COUNTY OF DOUGLAS )•
On this �rfh day of Ikuiut ., 20 , befo,a me the
undersined, a ota Public in and for said County, rsonal came J 1 ` '0 ✓.l'r
��i .G�,�'�i 1 who executed the above document and
acknowledged the execution thereof to be his/her voluntary act and deed as such officer and the
voluntary act and deed of the City of Omaha, a Municipal Corporation.
In testimony whereof, I have hereunto set my hand and affixed by Notary Seal at
Omaha in Douglas County Nebraska on the day and date last above written.
PuabiLJ
Notary Public
My commission x ires:
APPROVED AS TO FORM: GEl�AaLNoraRr-Srateo1Nebraska
KIMBERLY PULLIAM
My Comm.Exp.Dec.14,2021
9-0.flJj)/ 9-0/ e
ASSISTANT CITY ATTORNEY Date
CONSENT TO THE TRANSFER OF INTEREST AND ASSIGNMENT
In regards to the property located at 1920 Willis Avenue, and legally described as:
Lots 1, 2, 3, 4, 5, 6, 7, 8, 9 & 10, Block 3, Lake Additions to the City of Omaha, as .
surveyed, platted and recorded in Douglas County, Nebraska together with all of
vacated alley, except that portion of Lots 6, 7, 8, 9 and 10, Block 3, Lakes
Addition, as surveyed, platted and recorded in Douglas County, Nebraska, and
being more particularly described as follows:
Begin at the southwest corner of said Lot 6: thence north 01°43'46" west along
the west line of said Lots 6 through 10, a distance of 263.15 feet to the northwest
corner of said Lot 10; thence north 88°15'23" east along the north line of said Lot -
10, a distance of 12.00 feet; thence south 24°49'56" west, a distance of 22.36
feet; thence south 01°43'46" east, a distance of 233.15 feet; thence south
46°44'16" east, a distance of 14.14 feet to a point on the south line of the
aforesaid Lot 6; thence south 88°15'23" west along said south line, a distance of
12.00 feet to the point of beginning;
and pursuant to Section 22 of the Deed of Trust, Construction Security Agreement and
Assignment of Rents, between the City of Omaha and Fullwood Square Apartments, LP, filed
with the Douglas County Register of Deeds, on July 8, 2002, in Book 7244 on Page 327,
against the above-referenced property, the undersigned official of the City of Omaha does
hereby consent to the transfer of interest to the above-referenced property from Fullwood
Square Apartments Limited Partnership (Assignor), a Nebraska Limited partnership, 1920 Willis
Avenue, Omaha, Nebraska, to Fullwood Square I, LLC, a Nebraska Limited Liability Corporation
wholly-owned by New Community Development Corporation, a Non-Profit Corporation d/b/a
NeighborWorks Omaha.
Further, the undersigned official of the City of Omaha does hereby consent to the assignment of
all rights and obligations related to the Agreement and all related documents approved by the
City Council on September 11, 2001, by Resolution No. 2277, as amended, from Fullwood
Square Apartment, LP to Fullwood Square I, LLC, a Nebraska Limited Liability Corporation,
wholly-owned by New Community Development Corporation, a Non-Profit Corporation d/b/a
NeighborWorks Omaha.
IN WITNESS WHEREOF, this Consent has been executed by the undersigned as of
the date last written below.
ATTEST: CITY OF OMAHA, a Municipal Corporation
City erk f e City of Omaha Date MAYOR OF THE CITY OF OMAHA Date
APPROVED AS TO FORM:
ao.JURY ?t
ASSISTANT CITY ATTORNEY Date
NO. 1 ? ) 1
Item Submitted By: Pat Evans/Christina Williamson
Department: Planning
Council Meeting Date: August 7, 2018
Res. that, the Amendment, modifies the statement in the loan terms regarding accrued interest
and authorizes the Mayor to execute the documents necessary to facilitate the transfer of
property and assignment of rights and obligations related to the Agreement between the City
and Fullwood Square Apartments LP approved on September 11, 2000 by Resolution No. 2277
and as amended to Fullwood Square, LLC. (Approval of the Consent to Assignment and the
Consent to Transfer of Interest and Assignment will provide for the City's consent to the
transfer, and assign, to facilitate the Limited Partnership's compliance with the terms of the tax
credit agreement and insure the project will continue to provide affordable rental housing under
the terms of the original Agreement.)
Presented to City Council
August 7, 2018
APPROVED 7-0
City Clerk