Fiscal Note
This resolution would authorize a $2,700,000 loan to Arbor Gate Development, LLC ("Developer") for the redevelopment of the southeast corner of the West Beltline Frontage Road and Todd Drive. The redevelopment consists of an approximately 200,000 SF medical and commercial office building and not less than 750 surface and ramped parking stalls ("Project"). This loan would be repaid through incremental taxes generated by the Project and represents approximately 47% of the present value of all incremental taxes anticipated from the Project throughout the remaining 25-year life of the TID.
Funds to capitalize this loan would require authorization in the 2008 Capital Budget, funded with general obligation debt. While it is anticipated that the incremental taxes generated by the Project will be sufficient to repay the loan within approximately 9 years, the Developer is required to guarantee a minimum payment if sufficient future tax increment is not available. The Developer is also obligated to return an equity participation payment equal to either seven percent (7%) of the gross selling price of the Property, including improvements thereon, on the day of sale or seven percent (7%) of the assessed valuation of the Property, including improvements thereon on July 5, 2032, whichever occurs first, in an amount not to exceed $2,700,000. The increment guarantee and equity participation payment are secured by a subordinated mortgage on the property. The TIF Loan is contingent upon Developer providing the City evidence, to the City's satisfaction, that at least 50% of the 174,000 SF of medical and office uses are pre-leased, or some other pre-lease percentage as evidenced by a primary lender financial commitment.
Title
Authorizing the Mayor and City Clerk to execute a development agreement to fund a $2,700,000 Tax Incremental Finance Loan to Arbor Gate Development, LLC to assist in the development of the Arbor Gate commercial redevelopment project locat...
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