HomeMy WebLinkAboutResolution 2015-090 N.C.S. 06/15/2015Resolution No. 2015 -090 N.C.S.
of the City of Petaluma, California
APPROVING EXECUTION OF AN ASSIGNMENT AGREEMENT WITH
PARK LANE APARTMENTS CORPORATION IN CONNECTION WITH
THE ACQUISITION AND REHABILITATION OF PARK LANE
APARTMENTS AND AUTHORIZING THE CITY MANAGER TO EXECUTE
ALL DOCUMENTS NECESSARY TO IMPLEMENT THE AGREEMENT
WHEREAS, the Petaluma Community Development Commission previously provided
financing to Park Lane Apartments Corporation, a California nonprofit public benefit corporation
( "Owner ") to assist in the development of Park Lane Apartments, an affordable housing project
consisting of 90 units of multifamily housing (the "Project ") managed by an affiliate of Burbank
Housing Development Corporation ( "Burbank "); and
WHEREAS, to facilitate the refinancing and rehabilitation of the Project, the Owner
intends to sell the Project to Park Lane L. P., a California limited partnership ( "Developer ") in
which Burbank or an affiliate of Burbank will serve as the general partner; and
WHEREAS, in connection with the sale and refinancing of the Project, the Developer
will execute a promissory note payable to the Owner in the amount of approximately $8,068,600
(the "Seller Note ") secured by a deed of trust, and will pay cash to the Owner in the approximate
amount of $996,000; and
WHEREAS, in connection with the refinancing and rehabilitation of the Project, the
term of affordability will be extended for a term of 55 years commencing upon completion of the
rehabilitation; and
WHEREAS, the Owner and Burbank propose to (i) assign to the City the right to receive
payment under the Seller Note and the deed of trust securing repayment of the Seller Note, and
(ii) provide to the City approximately $800,000 of the cash proceeds from the sale of the Project,
provided that the City agrees to use the cash proceeds to support affordable housing in the City
of Petaluma; and
WHEREAS, a proposed form of an Assignment Agreement (the "Assignment
Agreement ") has been provided to the City Council; and
WHEREAS, in connection with the rehabilitation of the Project, conventional lenders
will provide construction and permanent financing, and may require the subordination of the
deed of trust securing the Seller Note.
hereby:
NOW THEREFORE BE IT RESOLVED that the City Council of the City of Petaluma
1. Finds that the transactions described in this Resolution will facilitate the improvement
of the City's stock of affordable housing and will result in an increase in the term of
affordability of the Project.
Resolution No. 2015 -090 N.C.S. Page 1
2. Approves the Assignment Agreement, and authorizes the City Manager or his
designee to execute and deliver the Assignment Agreement substantially in the form
provided for City Council review, with such modifications as may be approved by the
City Manager in consultation with the City Attorney, provided that such
modifications are consistent with the intent of this Resolution and do not substantially
increase the obligations or impair the rights of the City.
3. Agrees to subordinate the deed of trust executed to secure the Seller Note to the deeds
of trust and the regulatory agreements to be executed by Developer for the benefit of
the Project construction and permanent lenders, provided that the City is provided
reasonable protections including reasonable notice and cure rights in the event of a
default under the senior documents.
4. Authorizes and directs the City Manager and his designees to execute all documents
and to take all actions reasonably necessary to implement this Resolution and the
transactions described herein.
Under the power and authority conferred upon this Council by the Charter of said City.
REFERENCE: I hereby certify the foregoing Resolution was introduced and adopted by the Approved as to
Council of the City of Petaluma at a Regular meeting on the 15'h day of June, 2015, rm:
by the following vote:
r d
City orney
AYES: Albertson, Barrett, Healy, Kearney, King, Vice Mayor Miller
NOES: None
ABSENT: Mayor Glass
ABSTAIN: None 7 /t
ATTEST:
City Clerk Vi e Mayor
Resolution No. 2015 -090 N.C.S. Page 2