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HomeMy WebLinkAboutContract 35571-A8 CITY SECRETA1O' CONTRACT NO, 6V, PVG��O�� AR EIGHTH AMENDMENT OF PURCHASE CONTRACTS AND ASSIGNMENT THIS EIGHTH AMENDMENT OF PURCHASE CONTRACT ("Amendment") is made and entered into by and between the CITY OF FORT WORTH, TEXAS, acting by and through its duly authorized City Manager or Assistant City Manager ("Seller"), and CYPRESS EQUITIES I, LP ("Purchaser"), as of December 31, 2013 ("Amendment Effective Date"). RECITALS A. Seller and Purchaser entered into Purchase Contracts(City Secretary Contract No. 35571 and 35570) dated as of July 25, 2007 for the sale and purchase of an approximately 194,776 square foot tract of land described as parcels, 3A, 4A, 4C and an approximately 94,822 square foot tract of land described as parcels 313, 413, 4D and 5 as shown on the attached Exhibit "A", (collectively, the "Property"). B. City Secretary Contract No. 35570 is referred to herein as "Contract 35570" and City Secretary Contract No. 35571 is referred to herein as "Contract 35571", and Contract 35570 and Contract 35571 are referred to herein collectively as the "Contracts". C. By the terms of the Contract 35571, an extension of the option period of Contract 35570 also effected an extension of Contract 35571. D. Seller and Purchaser amended Contract 35571 (City Secretary Contract No. 36454, the "First Amendment") to extend the option period and allow Purchaser to take down individual tracts of land for the development of a commercial/retail center. E. Seller and Purchaser amended Contract 35571 (City Secretary Contract No. 35571-A2, the"Second Amendment") to extend the option period for an additional six months. F. Seller and Purchaser amended Contract 35571 (City Secretary Contract No. 35571-A3, the"Third Amendment")to extend the option period for an additional six months. G. Seller and Purchaser amended Contract 35571 (City Secretary Contract No. 35571 A4, the"Fourth Amendment")to extend the option period to July 1, 2011. H. Seller and Purchaser amended Contract 35571 (City Secretary Contract No. 35571 A5, the"Fifth Amendment")to extend the option period to January 1, 2012. 1. Seller and Purchaser amended Contract 35571 (City Secretary Contract No. 35571 A6, the"Sixth Amendment")to extend the option period to January 1, 2013. J. Seller and Purchaser amended Contract 35571 (City Secretary Contract No. 35571 A7, the"Seventh Amendment")to extend the option period to January 1, 2014. K. Purchaser has requested that Seller extend the option period of the Contracts and allow the assignment of the Contracts to the Fort Worth Housing Finance Corporation. OFFICIAL RECORD CITY SECRETARY CSC Nos. 35570 and 35571 FT. WORTH, TX Cypress Eighth Amendment to Purchase Agreement Page 1 Assignment to Fort Worth Housing Finance Corporation Rev. 07/2015 L. Seller's City Council approved the assignment of the Contracts to the Fort Worth Housing Finance Corporation on May 13, 2014 (M&C L-15682) and the Board of Fort Worth Housing Finance Corporation approved acceptance of the assignment of the Contracts on March 4, 2014. AGREEMENT In consideration of the mutual covenants in this Eighth Amendment, Seller and Purchaser agree as follows: 1. Section 6(a)of Contract 35571 is amended to provide as follows: "(a) Purchaser shall have a period of time commencing on the Effective Date and terminating on December 31, 2015 ("Option Period") during which to enter and examine the Property and, at its expense, conduct the Test(defined below). 2. Section 6(a)of Contract 35570 provides the following "Notwithstanding anything to the contrary contained in this Contract, the Option Period shall be automatically extended to coincide with the end of the Option Period as provided in that separate Purchase Contract between Seller and Purchaser regarding the West Retail property." Therefore, the Parties agree that upon execution of this Eighth Amendment, the Option Period contained in Contract 35570 shall automatically be extended as provided in Section 1 above. 3 Section 8 of the Contracts is deleted. 4. Purchaser hereby assigns all of its rights and obligations under the Contracts to the Fort Worth Housing Finance Corporation ("Assignee") and Assignee accepts assignment of all rights and obligations under the Contracts effective June 1, 2014 ("Assignment Date"). Purchaser is released from all obligations and liabilities under the Contracts effective on the Assignment Date. Seller hereby instructs and directs the Title Company (as defined in the Contracts) to release all Earnest Money(as defined in the Contracts)and interest earned thereon to Purchaser. 5. Seller and Assignee agree that the Contracts are hereby amended to provide that the total purchase price for all property remaining under the Contracts is $1,449,290.17, and that all property shall be purchased simultaneously by Assignee. Except as amended by this Eighth Amendment, all of the terms and conditions of the Contracts are ratified and remain in full force and effect. This Eighth Amendment is executed as of the Effective Date. The Assignment is effective as of the Assignment Date. (SIGNATURE PAGES TO FOLLOW] CSC Nos. 35570 and 35571 Cypress Eighth Amendment to Purchase Agreement Page 2 Assignment to Fort Worth Housing Finance Corporation Rev. 07/2015 fORr 0 'D o 0-4 p° $° °© 00°0°° SELLER: Attest x p►� CITY OF FORT WORTH ft lm , 1eA, t k VIw a J. Kayser, Assistant City Manager City Secretary Contract Authorization M&C L-15646 approved 12.17.13, and M&C L-15682 approved 5.13.14 Appr ved as to Form and Legality Assistant City Attorney PURCHASER: ASSIGNEE: CYPRESS EQUITIES I,L.P. FORT WORTH HOUSING a Texas limited partnership FINANCE CORPORATION, a Texas housing finance corporation By: Cypress Equities, I LLC,a Texas limited Liabral Partnerpyn Brian p Parro, Jesus Chapa, Chief Financial Officer/Vice President General Manager OFFICIAL RECORD CITY SECRETARY I:T.WORTH,TX CSC Nos. 35570 and 35571 Cypress Eighth Amendment to Purchase Agreement Page 3 Assignment to Fort Worth Housing Finance Corporation Rev. 07/2015 M&C Review Page 1 of 2 Official site of the City of Fort Worth,Texas CITY COUNCIL AGENDA FOR 111 COUNCIL ACTION: Approved on 5/13/2014 DATE: 5/13/2014 REFERENCE L-15682 LOG NAME: 17CYPRESSASSIGNMENT NO.. CODE: L TYPE: NOW PUBLIC NO CONSENT HEARING: SUBJECT: Approve Assignment of the Purchase Contract with Cypress Equities I, LP, City Secretary Contract Nos. 35570 and 35571, to the Fort Worth Housing Finance Corporation, and Amend the Contracts to Increase the Purchase Price from Approximately $1.1 Million to $1,449,290.17 to Resolve Issues with the United States Department of Housing and Urban Development for the Evans and Rosedale Redevelopment Area (COUNCIL DISTRICT 8) RECOMMENDATION: It is recommended that the City Council: 1. Approve the Assignment of the Purchase Contract with Cypress Equities I, LP, City Secretary Contract Nos. 35570 and 35571, to the Fort Worth Housing Finance Corporation; 2. Amend the Purchase Contract to increase the purchase price from aproximately $1.1 mllion to $1,449,290.17 and remove the requirement for a Planned Development Special Use with site plan before closing; 3. Authorize the execution and recording of deeds conveying the remaining property to the Fort Worth Housing Finance Corporation; and 4. Authorize the payment of$1,449,290.17 from the funds received from the sale of the property to the United States Department Housing and Urban Development to close the Evans and Rosedale Economic Development Activity. DISCUSSION: In 1999, the City began purchasing property for the Evans and Rosedale Re-Development Project (Project). The Project boundaries are Evans Avenue to the East, Rosedale Avenue to the South, I- 35W to the West and Terrell Avenue to the North. The City purchased the properties with Community Development Block Grant (CDBG) funds received from the United States Department of Housing and Urban Development (HUD). HUD regulations require that a national objective be met if CDBG funds are used to acquire property. If the national objective is not met, the funds must be repaid to HUD. The national objective for the Project was the creation of jobs for low and moderate income persons. The number of jobs that must be created is determined by the amount of federal funds used, and the Project required that 108 new jobs be created within the Project boundaries. Once all of the property was assembled for the Project, the City began to market it to developers. On June 5, 2007, the City Council chose Cypress Equities I, LP (Cypress), as the Master Developer for the Project and authorized the sale of approximately 6.9 acres of City-owned property in the Project to Cypress for approximately $1.1 million (M&C L-14331). Even though Cypress worked diligently to attract business to the area, it has been slow to develop because of the downturn of the economy. In November 2010 and June 2012, Cypress acquired and sold properties to Jack-in-the-Box and 7- Eleven, which together created approximately 25 jobs. Since the total number of required jobs has not been created, this requires that the CDBG funds used to purchase the property that has not been redeveloped must be repaid in order to eliminate the job http://apps.cfwnet.org/council_packet/mc_review.asp?ID=19785&councildate=5/13/2014 8/4/2015 M&C Review Page 2 of 2 creation requirements tied to this property. The amount that must be repaid to HUD is $1,449,290.17. On March 4, 2014, the Board of the Fort Worth Housing Finance Corporation (HFC) approved the purchase of the remaining property from the City for a total purchase price of $1,449,290.17. Cypress is willing to assign the Purchase Contracts to the HFC. Staff recomends approving the assignment of the Purchase Contracts to the HFC and amending them as follows in order that the repayment to HUD can occur within the next 30 days: - Increase the purchase price for the remaining property to $1,449,290.17 in order that the funds can be repaid to HUD and all HUD obligations regarding these properties can be cancelled. - Delete the requirement for a Planned Development Special Use with a site plan before closing. Staff also recommends that upon repayment to HUD, the City request that HUD allow the repaid funds to be placed in a restricted account that can be used by the City for CDBG-eligible activities. The property is located in COUNCIL DISTRICT 8, Mapsco 77K. FISCAL INFORMATION/CERTIFICATION: The Financial Management Services Director certifies that this action will have no material effect on City funds. TO Fund/Account/Centers FROM Fund/Account/Centers 4) GG01 105100 0000000 $1.449.290.17 Submitted for City Manager's Office by: Fernando Costa (6122) Originating Department Head: Jay Chapa (5804) Additional Information Contact: Cynthia Garcia (8187) ATTACHMENTS Remainder Progerty.gdf http://apps.cfwnet.org/council_packet/mc review.asp?ID=19785&councildate=5/13/2014 8/4/2015 RESOLUTION NO. FWHFC-2014-03 FORT WORTH HOUSING FINANCE CORPORATION A RESOLUTION AUTHORIZING THE ACCEPTANCE OF AN ASSIGNMENT OF CITY OF FORT WORTH CITY SECRETARY CONTRACTS NOS. 35570, AND 35571 FROM CYPRESS EQUITIES I, LP FOR THE PURCHASE OF CERTAIN REAL PROPERTY LOCATED IN THE EVANS AND ROSEDALE NEIGHBORHOOD FROM THE CITY OF FORT WORTH FOR $1,449,290.17 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; WHEREAS, the City Council established 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 promote and 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 citizens in acquiring quality, accessible, affordable housing through lending and construction activities; WHEREAS, in 1999, the City began purchasing properties for the Evans and Rosedale redevelopment project with Community Development Block Grant ("CDBG") funds which included a requirement that 108 jobs be created for low- to moderate-income individuals. In 2007 the City Council selected Cypress Equities I, LP ("Cypress") as the Master Developer for the project and authorized the sale of 6.9 acres, more or less, of City-owned property to Cypress under the terms of two Purchase Contracts (M&C L- 14331; City Secretary Contract Nos. 35570 and 35571); WHEREAS, Cypress acquired and sold certain of the City properties to businesses which created approximately 25 jobs to fulfill the job requirement, but if the total job requirement is not met, City will be required to repay a portion of the CDBG funds to the United States Department of Housing and Urban Development ("HUD"); WHEREAS, Cypress's option in the Purchase Contracts for the remaining City land expires on March 31, 2014, and if Cypress does not secure a project creating jobs by that date, the remaining HUD job creation requirement will be triggered and City will have to repay $1,449,290.17 to HUD; and WHEREAS, the Board of the Corporation desires to accept an assignment from Cypress Equities 1, LP of the Purchase Contracts with the City for the remaining land and agree to an amended purchase price of$1,449,290.17, the amount needed to repay HUD and eliminate the job requirement tied to City's original acquisition of the land with CDBG funds. RESOLUTION NO. FWHFC-2014-03 PAGE 2 NOW THEREFORE, LET IT BE RESOLVED BY THE BOARD OF DIRECTORS OF THE FORT WORTH HOUSING FINANCE CORPORATION: 1. THAT the Board approves the execution and delivery of an Assignment ("Assignment") by and between Cypress Equities I, LP ("Cypress"), the City of Fort Worth ("City") and the Corporation which assigns Cypress's rights and obligations under City Secretary Contracts Nos. 35570 and 35571, as amended (the "Contracts")to the Corporation. 2. THAT the Board approves and accepts an amendment to the Contracts which increases the total purchase price of the City land to $1,449,290.17 and removes the requirement for a Planned Development Special Use with site plan before closing. 3. THAT the Board approves and accepts the conveyance from City to the Corporation of the remaining City land more particularly described in the Contracts for the purchase price of $1,449,290.17 plus payment of all common and customary closing costs, including payment of any postjudgment taxes. . 4. THAT "Tom Higgins, General Manager of the Corporation, or Jesus Chapa, Assistant General Manager of the Corporation, are authorized to execute and deliver the Assignment for and on behalf of the Corporation and any related documents necessary to implement the Assignment, and each may extend, modify and amend the Assignment, provided any such extensions, modifications and amendments are in compliance with City Ordinances, and the goals and purposes of the Corporation as amended from time to time. 5. THAT Tom Higgins, General Manager of the Corporation, or Jesus Chapa, Assistant General Manager of the Corporation, are authorized to accept the deeds for the purchase of the land described in the Contracts, execute and deliver the closing statements for and on behalf of the Corporation along with any related documents necessary to complete the purchase of the land. 6. THAT the Board approves all related activities necessary to market the land for sale and development. 7. THAT this Resolution takes effect from the date of its adoption. AND IT IS SO RESOLVED. Adopted March 4, 2014. FORT WO TH HOU, ING FINANCE CORPORATION By: C9v n Salvador Espino, Presid t