HomeMy WebLinkAbout(0002) M&C 22-0112City of Fort Worth, Texas
Mayor and Council Communication
DATE: 02/22/22 M&C FILE NUMBER: M&C 22-0112
LOG NAME: 17AMEND ARPA ALLOCATIONS EVANS & ROSEDALE DEVELOPMENT
SUBJECT
(CD 8) Amend Mayor and Council Communication 21-0810 to Include Affiliates of Hoque Global, LLC as Authorized Parties and to Correct the
Listed Fair Market Value for the Local Development Corporation's Properties to Align with the Approved Fair Market Value for All Properties
RECOMMENDATION:
It is recommended that the City Council:
1. Amend the Mayor and Council Communication 21-0810 to include affiliates of Hoque Global, LLC as authorized counterparties for
purchasing the properties from the City of Fort Worth and execution of all related loan documents and other agreements necessary to secure
performance of the affordability requirements; and
2. Correct the fair market value listed incorrectly in Mayor and Council Communication 21-0810 for the Local Development Corporation's
properties from $235,950.00 to $537,076.29.
DISCUSSION:
The purpose of this Mayor and Council Communication (M&C) is to revise M&C 21-0810 to include affiliates of Hoque Global, LLC as allowed
counterparties to the transaction and to ensure the amount listed as the fair market value of the Local Development Corporation's properties is
correctly and consistently identified throughout.
On October 19, 2021, the City Council approved M&C 21-0810, which authorized the sale of 36 properties to Hoque Global, LLC for the purpose
of construction of affordable housing and other structures necessary to support the required affordable units. The affordability requirements will be
secured by loan documents and one or more liens against the property.
As adopted, the M&C only authorized selling the property to and executing agreements with Hoque Global, LLC itself and did not include the
ability to contract with Hoque's affiliates. Because lenders for these types of large real estate developments require developers to create and use
single purpose entities in order to protect the lender's investment, it is necessary for the City of Fort Worth (City) to contract with not only Hoque
itself but its affiliates, including the entity that is created to own, develop, and manage the development. The City typically authorizes agreements
with a named entity and its affiliates in these type of transactions, and approval of this amendment to include Hoque's affiliates would be
consistent with that past practice and would correct the prior omission.
Additionally, the amount listed as the fair market value of the Local Development Corporation's properties in the prior M&C was not correctly
listed in all places in the document. The total amount of the Fort Worth Local Development Corporation (LDC) properties should be $537,076.29,
as shown in the chart in the discussion section of M&C 21-0810, and not $235,950.00, which is what was listed in the recommendation and text of
the discussion. Adoption of this M&C would revise the prior Council action to refer to the correct amount $537,076.29 throughout.
Correcting the fair market value price of the LDC properties does not change the total amount approved by Council as the fair market value price
for all thirty-six (36) properties, $4,245,533.42, because that total amount was correctly and consistently stated in the prior M&C.
A Form 1295 is not required because: This M&C does not request approval of a contract with a business entity.
FISCAL INFORMATION / CERTIFICATION:
The Director of Finance certifies that approval of these recommendations will have no material effect on City funds.
Submitted for City Manager's Office by: Fernando Costa 6122
Reginald Zeno 8517
Originating Business Unit Head: Victor Turner 8187
Robert Sturns 2663
Additional Information Contact: Amy Connolly 7556
Jo Ann Pate 6259