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HomeMy WebLinkAboutResolution Fort Worth Housing Finance Corporation (FWHFC) FWHFC-2011-12RESOLUTION NO. FWHFC-2011-12 FORT WORTH HOUSING FINANCE CORPORATION A RESOLUTION AUTHORIZING CHANGES IN THE TERMS OF THE SALE OF THE VILLAS OF EASTWOOD TERRACE LOCATED AT 4700 E. BERRY STREET BY THE VILLAS OF EASTWOOD TERRACE, L.L.C., TO THE HOUSING AUTHORITY OF THE CITY OF FORT WORTH, AND AUTHORIZING THE SALE OF ADJACENT LAND AS PART OF THE TRANSACTION WHEREAS, the City Council of the City of Fort Worth (the "City") created the Fort Worth Housing Finance Corporation (the "Corporation") in 1979 pursuant to the Texas Housing Finance Corporation Act to facilitate the development of quality, accessible, affordable housing for low and moderate income City residents through lending and construction activities; WHEREAS, the Corporation created the Villas of Eastwood Terrace, LLC in 2001 for the purpose of developing, owning and operating the Villas of Eastwood Terrace, a 160-unit senior housing project located at 4700 E. Berry Street, Fort Worth, Texas 76110; WHEREAS, the development of the project was financed in part with a $9,663,500.00 mortgage loan insured by the Federal Housing Administration (the "FHA"), a part of the United States Department of Housing and Urban Development ("HUD") under the authority Section 221(d)(3) of the National Housing Act; WHEREAS, the Villas of Eastwood Terrace, LLC (the "Company") wishes to sell the Villas of Eastwood Terrace to The Housing Authority of the City of Fort Worth, also known as the Fort Worth Housing Authority (the "FWHA") or an affiliate, which will assume the Company's obligations under the mortgage loan on the project, WHEREAS, the City receives grant funds from HUD through the HOME Investment Partnerships Program ("HOME") with which the City promotes activities that expand the supply of affordable housing and develop partnerships with non profit housing organizations to benefit low and very low income City citizens by providing them with affordable housing; WHEREAS, on June 23, 2009, the City Council in M&C C-23620 approved the expenditure of $1,400,000.00 of its HOME funds in the for�n of a forgivable subordinate loan to the FWHA for the purchase of the Villas of Eastwood Terrace froin the Company; RESOLUTION NO. FWHFC-2011-12 PAGE 2 WHEREAS, as a result of a shortfall in achievable rents when compared to the projections made during the planning and underwriting stages, the project has experienced operating deficits and the Corporation has advanced its own funds to cover these deficits; WHEREAS, the First Amended and Restated Regulations of the Company provide that the business and property of the Company be managed by a Board of Managers which shall be appointed by the City Council; WHEREAS, on June 8, 2010, the Board approved the actions of the Managers of the Company in selling the Company's sole asset, the Villas of Eastwood Terrace (the "Villas"), to a single asset entity affiliated with the FWHA for a price not to exceed $10,616,891.06 and payment of up to $100,000 in closing costs, and for the Managers to take all reasonable actions necessary on behalf of the Corporation to effect such sale; WHEREAS, market conditions changed so that HOME funds could no longer be used in the transaction and the sale could not be consummated on the original terms; WHEREAS, new terms have been negotiated by the Managers including the proposed transfer c�f four adjacent undeveloped tracts of land to be included with the sale of the Villas, that the Corporation will maintain a reserve account for operating deficits for five years not to exceed $60,000.00 per year for a total of no more than $300,000.00, that the Corporation will pay all closing costs of the sale, and the FWHA will assume the outstanding loan on the Villas with Key Bank; WHEREAS, the Board desires to approve the actions of the Managers of the Company in selling the Villas to an affiliate of the FWHA on the changed terms and conditions. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE FORT WORTH HOUSING FINANCE CORPORATION (THE "BOARD") THAT the Managers of the Company, namely, Tom Higgins, Susan Alanis and Jesus J. Chapa, be and hereby are authorized and directed to execute, on behalf of The Villas of Eastwood Terrace, LLC, a Texas limited liability company (the "Company"), any and all documents deemed reasonably necessary by thein to effect the sale and transfer of the Coinpany's sole asset, The Villas of Eastwood Terrace senior apartments (the "Villas"), to an entity which is an affiliate of The Housing Authority of the City of Fort Worth (the "FWHA"), including but not limited to executing any and all documents deemed by them as necessary and appropriate to obtain the approval of the United States Department of Housing and Urban Development ("HUD") and Key Bank for said sale, transfer and loan assumption. RESOLUTION NO. FWHFC-20ll-12 PAGE 3 2. THAT the Board approves the expenditure by the Corporation of a sum not to exceed $100,000.00 for the purpose of paying all reasonable and necessary costs and expenses in order to effect the sale and transfer of the Villas including but not limited to payment of closing costs, surveys, attorney's fees, appraisals, loan assumption costs, title company fees and costs, and any fees payable to HUD or Key Bank for the transfer of the property and the assumption of the Company's HUD-insured loan with Key Bank. 3. THAT the Board approves the transfer of 4 tracts of land lcnown as Lots AR8, AR7A, AR 10 and AR7C, Eastwood Terrace Addition (the "Land"), to the FWHA or its afiiliate as part of the sale of the Villas. 4. THAT the Board approves the execution and delivery of all sales contracts, closing statements, warranty deeds and other related documents necessary to consummate the transfer of the Land. 5. THAT Tom Higgins, General Manager of the Corporation, or Jesus J. Chapa, Assistant General Manager of the Corporation, are authorized to execute and deliver the sale contract, closing statements and warranty deeds for and on behalf of the Corporation along with any related documents necessary to transfer the Land as part of the sale of the Villas. 6. THAT the Board authorizes the Corporation to establish and maintain a reserve account for five years that will not exceed $60,000.00 per year for a total of no more than $300,000.00 for operating deficits for the Villas. 7. THAT this Resolution takes effect on the date of its adoption. AND IT IS SO RESOLVED. Adopted June 7, 2011 FORT WORTH HOUSING FINANCE CORPORATION By: � r� � Ka hleen Hicks, President