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HomeMy WebLinkAbout1982-11-02; City Council; 6716-2; Rick Senior Center Housing Project- 0 w 7 0 cc a 2 . . E Y d 5 8 CITY OF CARLSBAD - AGENDA dlLL AB# b 7 !L -2 TITLE: DEPT. HD. MT& 11/2/82 RICK SENIOR CITIZEN HOUSING PROJECT DEPT. CA RECOMMENDED ACTION: If the City Council wishes to continue processing the Jefferson Street Senior Citizen Housing Project on the bases outlined in this L agenda bill, your action is by motion to so indicate and to adopt Resolution No. 7&45YT declaring your intention to issue multi-family residential revenue bonds for the project. ITEM EXPLANATION The City Council at your February 16, 1982 meeting directed the City Attorney and the Director of Building and Planning to work with Rick in developing 48 units of senior citizen housing. As a part of that action, the Council approved 15 basic points to be included in the necessary agreements. At that time the structure contemplated a three way arrangement between Mr. Rick, San Diego County and the City whereby the County would provide the land and the City the financing through an issue of tax exempt mortgage revenue bonds. At your meeting of April 6, 1982 the City Council approved our recommendations for the retention of bond counsel and accepted an advance of $10,000 from Mr. Rick to cover the costs of preparing the necessary legal documents. Since that time a great deal of work has been done. The terms of the grant deed have been negotiated with the County. The development and disposition of the agreement and the ground lease are in final draft form. For a number of reasons, it now appears that if the project is to continue to move ahead the structure of the deal needs to be changed. Mr. Rick, on behalf of the Jefferson House Partnership, in a letter dated October 4, 1982 states his desire to drop the program under which the County would buy the land. He suggests we proceed without involving the County. Assistance from the City will be limited to the provision of mortgage revenue bond financing either as a part of the City's ongoing multi-family program (AB-665) or as a separate project utilizing a private placed financing through the redevelopment agency (SB 99). Mr. Rick's proposal substantially simplifies matters and would make 20 percent of the units available to low income persons. The Director of Building and Planning recommends that the City Council approve the new structure for the project. While it will make a smaller contribution to the City's need for low income housing then as previously proposed, the direct financial subsidy from government to the project has also been eliminated. Staff prefers that the project be included as part of the City's - Rage 2 of Agenda Bill No. &7/6-&a multi-family mortgage revenue bond program. However, it is agreed that the developer should have the option of going forward with his own lender if for some reason the City's program is not available within a reasonable time (four to six months) to allow Rick to commence construction when he has completed the design phase of the project. It is recommended that the City Council indicate its approval and authorize staff to proceed as outlined in this agenda bill. If the City Council concurs the City Attorney recommends the adoption of the attached Inducement Resolution. This is a legally required step in order to proceed with mortgage revenue bond financing. If the City Council concurs we will continue to work with bond counsel on the financing for the project. The remaining balance of Mr. Rick's deposit with the City will be utilized to cover those costs. Mr. Rick has indicated that the expression of the City Council's concurrence is enough and based on that he will start design of the project. He will also notify San Diego County that he no longer desires to sell the property. EXHIBITS Letter from Mr. Rick dated October 4, 1982 Inducement Resolution JEI=ITRSON HOUSE October 4, 1982 Mr. Vincent Biondo City Attorney City of Carlsbad 1200 Elm Avenue Carlsbad, California 92008 Re: Jefferson Street Housing Dear Vince: We appreciate having met with you and Mr. Murphy on September 29th. Particularly, we appreciate your opening the options of proceeding without County/HUD participation under the two further options: either under AB 665 funding or with separate, privately arranged tax-exempt financing. We have talked with both our potential lender and with our legal counsel. It is our desire that we drop the program under which the County would buy the land. Instead we propose to proceed with either of the following , with our preference being the first: 1. Without AB 665 funding. Jefferson House will lease the property from Rick Engineer- ing Company and be the CUP permittee. We will then secure the money from our own sources secured by a mortgage-guaranteed note of the City. Twenty percent (ten dwelling units) of the units will be low income with increases limited to the HUD-approved percentage increase in new housing cost (or median income, if you prefer). The balance of the units will be market rate. 2. With AB 665 funding. The same as 1. above with the further proviso that the ten units be "affordable." Assuming you find the above comfortable, we should like to work with you and Mr. Murphy toward an agenda bill. 5620 Friars Road l San Diego, California 92110 l Phone 714/291-0707 3 .- Mr. Vincent Biondo -2- October 4, 1982 We will keep open the AB 665 option through final design. At the end of design we will be available to join the 665 program, if it is important to the City program and the City is ready to proceed. Otherwise, with our being ready, the City will proceed with us outside the AB 665 program. Sincerely, , WillidB. Rick WBR:lms cc: Mr. Robert C. Ladwig RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO r str*,c Addra,, I SPACE ABOVE THIS LINE FOR RECORDER’S USE - SUBORDINATION AGREEMENT NOTICE: THIS SUBORDLNATfON AGREEMENT RESULTS IN YOUR SECURITY INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT. THIS AGREEMENT, made this 13th day of August , IS’=, by PGP CARLSBAD SENIORS, LTD., a California Limited Partnership . owoer oi the land hereinafter described and hereinafter referred to as “Owner,” and THE , present owner and holder of the deed of trust and note first hereinafter described and hereinafter referred to as “Beneficiary”; WITNESSETH THAT WHEREAS, JEFFERSON HOUSE, a General Partnership did execute a deed of trust, dated December 19, 1983 , to TICOR TITLE INSURANL;IECWOFCAr,IEY>RNIAI aCali.fornia~ , as trustee, covering: Lots 1 to 8, inclusive, in Block 57 of Carlsbad, in the City of Carlsbad, County of San Diego, State of California, according to Map thereof No. 775, filed in the Office of the County Recorder of San Diego County on February 15, 1984; to secure a note in the sum of s 765 I 440-W , dated December 19, 1983 , in favor of OF clAE&.BAD l?ils 4 :~~tr~; IV; recorded FPbrw, in 6&’ “84-071?&x , which deed , Official Records of said WHEREAS, Owner has executed, or is about to execute, a deed of trust and note in the sum of SW, dated w!--, in favor of WUIERICA; P = P__ , hereinafter referred to as “Lender,” payable with interest and upon the terms and conditions described therein, which deed of trust is to be recorded concurrently herewith: and WHEREAS, it is a condition precedent to obtaining said loan that said deed of trust last above mentioned shall unconditionally be and remain at all times a lien or charge upon the land hereinbefore described, prior and superior to the lien or charge of the deed of trust first above mentioned; and WHEREAS, Lender is willing to make said loan provided the deed of trust securing the same is a lien or charge upon the above described property prior and superior to the lien or charge of the deed of trust first above mentioned and provided that Beneficiary will specifically and unconditionally subordinate the lien or charge of the deed of trust first above mentioned to the lien or charge of the deed of trust in favor of Lender; and WHEREAS, it is to the mutual benefit of the parties hereto that Lender make such loan to Owner; and Beneficiary is willing that the deed of trust securing the same shall, when recorded, constitute a lien or charge upon said land which is unconditionally prior and superior to the lien or charge of the deed of trust first above mentioned. NOW, THEREFORE, in consideration of the mutual benefits accruing to the parties hereto and other valuable consideration, the receipt and sufficiency of which consideration is hereby acknowledged, and in order to induce Lender to make the loan above referred to, it is hereby declared, understood and agreed as follows: (I) That said deed of trust securing said note in favor of Lender, and any renewals or extensions thereof, shall uocondi- tionally be and remain at all times a lien or charge on the property therein described, prior and superior to the lien or charge of the deed of trust first above mentioned. (2) That Lender would not make its loan above described without this subordination agreement. (3) That rhis agreement shall be the whole and only agreement with regard to rhe subordination of the lien or charge of the deed of trurt first above mentioned to the lien or charge of the deed of trusl in favor of Lender above referred 10 and shall supercede and cancel. hut only insofar a% would affect the priority between the deeds of trust hereinbefore specifically devcrihed. any prior agrccmenls a\ IO such $uhordination. including, bur not limited to, those provisions, if any, contained in the deed of Irust first above menrioned. which provide for the subordination of the lien or charge thereof to another deed or deeds of trust or 10 another mortgage or mortgages. SUBORDINATION, RECORDED DEED OF TRUST TO DEED OF TRUST TO RECORD. ~enefkiary declare& agrees and acknowledges (hat (a) He consents to and approves (i) all provisions of the note and deed of trust in favor of Lender above referred to, and (ii) all agreements. including but not limited to any loan or escrow agreements, between Owner and Lender for the disbursement of the proceeds of Lender’s loan; (b) Lender in making disbursements pursuant IO any such agreement is under no obligation or duty to. nor has Lender represented that it will, see to the application of such proceeds by the person or persons to whom Lender disburses such proceeds and any application or use of such proceeds for purposes other than those provided for in such agreement or agreements shall not defeat the subordination herein made in whole or in part; (c) He intentionally and unconditionally waives, relinquishes and subordinates the lien or charge of the deed of trust first above mentioned in favor of the lien or charge upon said land of the deed of trust in favor of Lender above referred to and understands that in reliance upon, and in consideration of, this waiver, relinquishment and subordination specific loans and advances are being and will be made and, as part and parcel thereof, specific monetary and other obligations are being and will be entered into which would not be made or entered into but for said reliance upon this waiver, relinquishment and subordination; and (d) An endorsement has been placed upon the note secured by the deed of trust first above mentioned that said deed of trust has by this instrument been subordinated to the lien or charge of the deed of trust in favor of Lender above referred to. NOTICE: THIS SUBORDlNATlON AGREEMENT CONTAINS A PROVISION WHICH ALLOWS THE PERSON OBLI- GATED ON YOUR REAL PROPERTY SECURITY TO OBTAIN A LOAN A PORTION OF WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEICMT OF THE LAND. THE &I: --._ -_- By: (ALL sistant City Clerk SIGNATURES MUST BE ACKNOWLEDGED) PGP CARLSBAD SENIORS, LTD., A California Limited Partnership . IC GROWTHPROPERTIES,.acalif- ornia General Partnership, General nc er IT IS RECOMMENDED THAT, PRIOR TO THE EXEClJTlON OF THIS SUBORDINATION AGREEMENT, Tf1E PARTIF,S 3453 CONSULT WITH THEIR ATTORNEYS WITH RFSPECT THERETO. (CLTA SURORDINATION FORM “A”) . . NO. ‘FFOOOlO THIS FORM FURNISHED BY ~‘(7-64) fl TICOR TITLE INSURANCE L --I---. ---. . PLEASE SIGN AND ACKNOWLEI THIS INSTRUMENT BEFORE A NOTARY PUBLIC. BE SURE THE NOTARY SEAL IS LEGIBLE, ; SIGN YOUR NAME EXACTLY AS IT IS TYPEWRITTEN ON THIS )GE DOCUMENT. CAT. NO. NN00637 TO 1955 CA (l-63) (Partnership as a Partner of a Partnership) ~TICORTITU INSURANCE said State, personally appeared personally known to me or pro the partnership that executed the within instrument, and a partnership, and that said last named partnership ex;cuted the sarqe. WITNESS my hand and o Signature \ u STATE OF CALIFORNIA COUNTY OF San Diego (This area for official notarid seal) ss: On August 21, 1990 before me, the undersigned, a Notary Public in and for said State, personally appeared Claude A. Lewis and Karen Kundtz , knowntometobe the Mayor an a Assistant Clt of Carlsbad, California and known to me to be the persorFwho executed the within instrument on behalf of said public corporation, agency or political subdivision, and acknowledged to me that such public corporation, agency I or political subdivision executed the same. official seal. (Signature) Randee Harlib Name (Typed or printed) My Ccmm. Exp. Feb. 20.1991 capital Growth moperties. Inc. JOHN E. MICHAELSEN PRESIDENT September 7, 1990 Mr. Marty Orenyak Director of Community Development CIT‘f GF CARLSHAD FAX - 438-0894 RE: Promissory Note in Favor of the City of Carlsbad on Jefferson House I Apartments 3090 Jefferson Street Carlsbad, California Dear Mr. Orenyak, I am the General Partner of the buying entity that is Purchasing Jefferson House I Apartments. This letter is to make you aware that I have reviewed all the documents relating to the Note, fully understand my obligations,as the new owner and agree to be bound by the terms and conditions of the Note, Deed of Trust, Exhibit A to the Deed, Section 21.18.045 of the Carlsbad Municipal Code and Conditional Use Permit 82-3. I understand that the amount of the Note is $765,440 plus interest from the date of origination in 1983. I understand that no payment shall be recuired on the Note except as provided in paragraphs 1 and 2 of Exhibit A, Additional Provisions to Subordinated Deed of Trust. I understand that in the operation of the project I must comply with Section 21.18.045 of the Carlsbad Municipal Code in all respects. I have carefully reviewed Exhibit A and Code Section 21.18.045, and I fully understand and agree to comply. TEL: (619) 454-6657 FAX: (619) 454-3257 1120 SILVERADO STREET LA JOLLA, CALIFORNIA 92037 -. Mr. Marty Orenyak September 7, 1990 Page Two I am involved as a General Partner in two other apartment properties in Carlsbad, namely Laguna Palms and Carlsbad Coast Apartments. We are excited about being involved with a third project and specifically a seniors apartment. Your acceptance of this letter acknowledges that the project is now in full compliance with Section 21.18.045 of the CarlsbadMunicipal Code. The Buyer and Seller are anxious to close this transaction as quickly as possible and I hope this letter will allow you to help us in that regard. I appreciate your help and look forward to working with your office in the future. Please call with any questions that you may have. Sincerely, &hn E. Michaelsen President JEM/dmm