SUBJECT/RECOMMENDATION:
Title
Approve funding in the form of a deferred loan in an amount not to exceed $845,000 to be provided by the City of Clearwater to Tampa Bay Neighborhood Housing Services, LLC. for real property located at 1552 S Myrtle Ave. contingent upon staff’s satisfactory review and acceptance of applicable mortgage documentation, title commitment, and a new Land Use Restriction Agreement with a term of no less than 15 years and authorize the appropriate officials to execute documents required to affect closing of the loan.
Body
SUMMARY:
1552 S Myrtle Ave is an income restricted 14-unit apartment complex that is currently owned and operated by Hope Villages of America. The land use restriction agreement (LURA) on the property expires October 1, 2024. Hope Villages has decided to sell the property prior to the expiration of the LURA.
Tampa Bay Neighborhood Housing Services (TBNHS) has secured a purchase contract and intends to retain the property as affordable housing and prevent the current tenants from being displaced. TBNHS has requested a loan in the amount of $845,000 which will be partially repaid with a monthly payment equal to 50% of cashflow.
After acquisition, TBNHS plans to apply for Pinellas Penny funds to rehabilitate the existing units and demo the clubhouse that exists on the property and develop three additional units. At this time, no additional funding is expected to be requested of the City.
Housing staff has reviewed the application and has determined that the request is in line with city objective 2.4 and can be fulfilled utilizing HOME funds. The Housing staff has established the following terms for the acquisition loan:
• The homes are to be leased to individuals or families earning at or below 80% of the area median income.
• The loan will be repaid at 50% of cash flow following the completion of rehabilitation to units and the completion of the additional unit or within two years from the date of closing, whichever comes first.
• The final approval of the loan(s) will be contingent upon the approval of all funding sources.
• A Land Use Restriction Agreement will be placed on the property for the term of 15 years.
• Final approval will be contingent upon the satisfactory review of applicable mortgage documentation, title commitment, a new land use restriction agreement and any additional documentation required by the housing staff to affect closing of the loan.
Staff recommends the approval of a loan for acquisition of the subject property, not to exceed $845,000.
APPROPRIATION CODE AND AMOUNT:
Funding is to be provided by HOME loan funds.
USE OF RESERVE FUNDS:
N/A
STRATEGIC PRIORITY:
Objective 2.4 - Supports equitable housing programs that promote household stability and reduces the incidence of homelessness within Clearwater.
