HomeMy WebLinkAboutResolution Fort Worth Housing Finance Corporation (FWHFC) FWHFC-2021-20RESOLUTION NO. FWHFC-2021-20
FORT WORTH HOUSING FINANCE CORPORATION
A RESOLUTION
APPROVING A FORGIVABLE SUBORDINATE LOAN TO TOBIAS PLACE, LP FOR
THE DEVELOPMENT OF THE TOBIAS PLACE APARTMENTS LOCATED AT 505
WEST BIDDISON STREET AND 3500 JENNINGS AVENUE
WHEREAS, the City Council of the City of Fort Worth ("City") has adopted
development and revitalization of the City's neighborhoods and affordable housing stock as a
strategic goal, and City residents and the City Council have determined that quality accessible
affordable housing is needed for moderate, low and very low-income City residents;
WHEREAS, the City Council created the Fort Worth Housing Finance Corporation (the
"Corporation") in 1979 pursuant to the Texas Housing Finance Corporations Act, Chapter 394
of the Texas Local Government Code, to facilitate neighborhood revitalization and housing
initiatives in the City, including but not limited to issuing tax exempt bonds, developing,
rehabilitating and promoting housing, and assisting low to moderate income City residents in
acquiring quality, accessible, affordable housing through lending and construction activities;
WHEREAS, the Corporation seeks to promote neighborhood revitalization and foster the
development of affordable, quality housing throughout the City by developing partnerships
among the City, the Corporation, local governments, lenders, private industry and neighborhood -
based nonprofit housing organizations;
WHEREAS, Ojala Partners, LP ("Ojala"), a Texas limited partnership, is a developer of
affordable housing and has developed over 5,000 affordable and mixed income housing units in
Texas;
WHEREAS, on October 19, 2021, the Board of the Corporation (the "Board")
authorized the hiring of John C. Shackelford, Shackeeford, Bowen, McKinley & Norton, LLP, as
legal counsel to assist the Corporation with the negotiation of terms and to assist with Housing
Tax Credit and multifamily housing revenue bond applications for the Project and the
development, financing, construction and management of Tobias Place;
WHEREAS, the Board of the Corporation has approved an agreement with Ojala to
develop the Tobias Place Apartments, an approximately 291-unit multifamily housing
development to be located at 505 West Biddison Street and 3500 Jennings Avenue (the
"Project");
WHEREAS, Ojala will apply for 2022 Non -Competitive (4%) Housing Tax Credits
from the Texas Department of Housing and Community Affairs ("TDHCA") and has already
applied for multifamily revenue bonds from the Tarrant County Housing Finance Corporation to
finance a portion of the costs of the Project;
RESOLUTION NO. FWHFC-2021-20
PAGE 2
WHEREAS, the Corporation has agreed to participate in the Project by creating Tobias
Place GP, LLC, a Texas limited liability company (the "GP"), a single purpose entity to serve as
general partner of Tobias Place, LP, a Texas limited partnership (the "Partnership"), that will
own the Project;
WHEREAS, the Corporation has also approved various actions relating to the creation
and operation of the GP, the Partnership, and other actions necessary for the development of the
Proj ect;
WHEREAS, Ojala, on behalf of the Partnership, has applied to the Corporation for a
forgivable, subordinate loan in an amount up to $1,750,000.00 in gap financing for the Project
that will be used for either land acquisition or loaned to the Partnership to cover development
costs;
WHEREAS, if a portion of the funds are used to directly acquire the land, the acquisition
costs will proportionately reduce the amount of funds available as loan funds from the
Corporation to the Partnership, which will ensure that the Corporation does not loan or provide
more capital than $1,750,000.00 in total to the Partnership; and
WHEREAS, the Board desires to approve and accept a loan agreement with Tobias
Place, LP for a forgivable, subordinate loan in an amount up to $1,750,000.00, subject to
availability of funds and a potential reduction due to land acquisition costs, to develop Tobias
Place, a new affordable multifamily rental housing development.
NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF
THE FORT WORTH HOUSING FINANCE CORPORATION:
1. THAT the Board authorizes the execution and delivery of a loan agreement (the "Loan
Agreement") by and between the Corporation and Tobias Place, LP for a forgivable,
subordinate loan in an amount up to $1,750,000.00, subject to availability of funds and a
potential reduction due to land acquisition costs, to construct the Tobias Place
apartments, a new 291-unit affordable multifamily rental property located at 505 West
Biddison Street and 3500 Jennings Avenue, Fort Worth TX 76110 (the "Loan") on the
terms set forth on Attachment I.
2. THAT Fernando Costa, General Manager of the Corporation, or Victor Turner, Assistant
General Manager of the Corporation, or their duly appointed successors, are each
authorized to execute and deliver the Loan Agreement for and on behalf of the
Corporation along with any related documents or agreements necessary to implement the
Loan Agreement or the Loan, and each is authorized to extend, modify and amend the
Loan Agreement, the terms of the Loan or the terms of any related documents or
agreements, provided any such extensions, modifications and amendments are within the
scope of the Project, and in conformance with the goals and purposes of the Corporation,
as may be amended from time to time.
RESOLUTION NO. FWHFC-2021-20
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3. THAT this Resolution takes effect from the date of its adoption.
AND IT IS SO RESOLVED.
Adopted November 30, 2 02 1.
FORT WORTH HOUSING FINANCE CORPORATION
..
By:
Carlos Flores, President
RESOLUTION NO. FWHFC-2021-20
PAGE 4
ATTACHMENT
Loan Terms
Lender: Fort Worth Housing Finance Corporation
Borrower: Tobias Place, LP
Project: Tobias Place Apartments
Location: 505 West Biddison Street and 3500 Jennings, Fort Worth TX 76110
Loan Amount: up to $1,750,000.00, subject to reduction for land acquisition costs
Origination Fee: None
Interest Rate: 0%
Amortization: 20 years
Loan Term: Begins on date loan documents are executed. Matures 20 years from
stabilization/conversion but no later than 60 days after maturity date of
first lien permanent loan
Lien Priority: Subordinate only to first lien construction/permanent loan, or otherwise as
acceptable to FWHFC subject to underwriting and cash flow analysis
Payments: Forgivable at maturity so long as all requirements of the Loan Agreement
have been fulfilled and the Project remains affordable to households at
60% or below Area Median Income, as required by the terms of the tax
credit issued by TDHCA. If the loan is not forgiven at maturity, payment
of all outstanding principal and interest amounts are due at maturity.
Forgivable Loan: A forgivable loan is necessary to provide the gap financing necessary to
facilitate the financing of the Project, as verified in the FWHFC's review
of the proforma and underwriting of the Project. But for this forgivable
loan, the Project would not be financially feasible.
Loan Documents: Loan Agreement, Promissory Note, Deed of Trust, and a Guaranty, if
required
General
Contractor: FWHFC
Master
Subcontractor: To be determined
Guarantor: To be determined but must be acceptable to FWHFC. Payment and
completion guarantees in form and substance acceptable to FWHFC
during construction period
Recourse: Non -recourse as to Borrower
RESOLUTION NO. FWHFC-2021-20
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Financing: First lien construction loan $44,000,000 (estimated)
First lien permanent loan $29,000,000 (estimated)
Award of 4% tax credits from TDHCA $23,000,00 (estimated)
Bond proceeds from Tarrant County HFC: $30,000,000 (estimated)
Deferred Developer Fee: $1,600,000 (estimated)
FWHFC Loan up to $1,750,000.00 (either provided as a loan or used to
cover land acquisition costs)
Other Conditions: Pay all costs of Loan closing including Lender attorney fees
Provide lender's title policy
Acceptable environmental remediation, if required
All financing acceptable to Lender
Lien priority acceptable to Lender
Approval of final construction plans for Project
Survey acceptable to Lender
Appraisal acceptable to Lender
Payment & Performance Bond or Letter of Credit or satisfactory
equivalent from Master Subcontractor
Receipt of all required governmental approvals
Approval of current financial statements from Guarantor
Approval of final Project budget
Borrower counsel opinion in form and content satisfactory to Lender