HomeMy WebLinkAboutReso RDA 22-2005
RESOLUTION NO. 22-2005
REDEVELOPMENT AGENCY, CITY OF SOUTH SAN FRANCISCO
STATE OF CALIFORNIA
A RESOLUTION ADOPTING FINDINGS AND AUTHORIZING
EXECUTION OF A SUBORDINATION AGREEMENT FOR THE
GRAND OAK AFFORDABLE HOUSING PROJECT
WHEREAS, on March 9, 2005, the Redevelopment Agency of the City of South San
Francisco ("Agency") authorized the execution of a Construction Loan Agreement and the provision
of a loan in the amount of $3,500,000 (the "Loan") to Grand Oak Associates, a California limited
partnership affiliated with BRIDGE Housing Corporation (the "Developer") to develop an affordable
housing project on Oak and Grand Avenues (the "Project"); and
WHEREAS, in connection with the Loan, the Developer executed a Deed of Trust securing
repayment of the Loan ("Deed of Trust"), and the Developer and the Agency executed a Regulatory
Agreement pursuant to which the Developer has agreed to restrict the rents for 21 of the units
developed as part of the Project to affordable levels; and
WHEREAS, the California Statewide Communities Development Authority ("CSCDA") will
issue bonds in the amount of$ll ,372,000 for the Project, and CSCDA has assigned its rights under
the bond documents to Silicon Valley Bank ("Lender") which will provide construction and
permanent financing for the Project; and
WHEREAS, Health and Safety Code Section 33334.14 permits subordination of
redevelopment agency affordability restrictions provided that: (i) the agency makes a finding that
alternative financing is not reasonably available on economically feasible terms without
subordination, and (ii) the agency obtains written commitments to protect its investment in the event
of a default; and
WHEREAS, the Lender has indicated that it would be unwilling to provide construction and
permanent financing for the Project without subordination ofthe Deed of Trust and the Regulatory
Agreement, and the Developer has indicated that it has been unable to find alternate sources that
would enable it to finance the Project without subordination of such documents; and
WHEREAS, the proposed Subordination Agreement provides the Agency and the City with
rights to receive notice and to cure defaults arising under the senior loan documents; and
WHEREAS, the Lender has indicated that it would be unwilling to provide construction and
permanent financing for the Project without the Omnibus Ride:r modifying the Deed of Trust and the
Regulatory Agreement.
NOW, THEREFORE, BE IT RESOLVED by the Redevelopment Agency of the City of
South San Francisco that the Agency hereby:
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Section 1. Finds that without subordination ofthe Deed of Trust and Regulatory Agreement
an economically feasible alternative for financing the Grand Oak housing development is not
reasonably available.
Section 2. Authorizes the Executive Director or his designee to execute a Subordination
Agreement and Omnibus Rider substantially in the form on file with the Agency Secretary and to
take such other actions reasonably necessary to carry out the intent of this Resolution.
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I hereby certify that the foregoing Resolution was regularly introduced and adopted by the
Redevelopment Agency of the City of South San Francisco at a Regular meeting held on the 14th day
of December 2005 by the following vote:
AYES:
Boardmembers Mark N. Addiego. Pedro Gonzalez and Karyl Matsumoto.
Vice Chair Richard A. Garbarino and Chair loseph A. Fernekes
NOES:
None
ABSTAIN:
None
ABSENT:
None
ATIEST,4WL.... /h. '9:N-
Clerk
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