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Whitepaper - Anderson Pacific PropertyAnderson Pacific Property Anderson Pacific Property - 1 Common Name Anderson Pacific Property APN 098-0289-021-00 2010 Subdivision into 3 parcels: 1. Remainder Parcel (APN 098-0289-021-00) 2. Regional Theater Parcel (APN 098-0289-018-00) 3. Regional Theater Plaza Parcel (APN 098-0289-019-00) Related properties 1. Train Station Depot Building (relocated to a transit center) 2. Driveway Parcel (APN 097-0001-032- 00) Address 2009-2111 Railroad Avenue Funding Source  City Affordable Housing Fees (F611)  CalHFA Residential Development Loan Program funds Type of Transaction Loan from City to former-RDA Principal Amount Expended $8,000,000.00* $2,100,000.00* *$9,203,149 book value in 2013 $100,000 $825,000 Use of Funds  Property Acquisition  Predevelopment expenses  Closing Costs Anderson Pacific Property Anderson Pacific Property - 2 City, and RDA Staff Reports April 25, 2005 – Authorizing the City Manager to sign all necessary documents to loan $8,000,000 in City Affordable Housing Fees from the City to Anderson Pacific LLC to help facilitate the acquisition of the property. (Resolution 2005-099). May 14, 2007 – Authorizing execution of a Cooperation and Repayment Agreement from the City to loan the former-RDA up to $825,000 in Affordable Housing Fees to acquire the Southern Pacific Railway Depot. (Resolutions 2007-096, and RA 2007-02) May 12, 2008 – Authorizing a Purchase and Sale Agreement for the City to acquire the Livermore Village parcel, project plans, and entitlements from Livermore Village I LLC for $2,100,000 in Affordable Housing Fees, and appropriating up to an additional $100,000 in Affordable Housing Fees for costs related to the purchase. (Resolution 2008-106). August 4, 2008 – Authorizing the transfer of the property from the City to the former-RDA and execution of a Cooperation and Repayment Agreement in the amount of $10,969,743. (Resolutions 2008-171, and RA 2008-12) January 12, 2009 – Authorizing a restructuring of the Cooperation and Repayment Agreement to obligate up to $5,000,000 in RDLP funds to the Livermore Village Project. (Resolutions 2009-09, and RA 2009-01). January 11, 2010 – Authorizing the former- RDA’s acquisition of the driveway parcel. (Resolution RA 2010-01). Oversight Board Staff Reports None. City Resolutions 2005-099 2007-096 (depot) 2008-106 2008-171 2009-009 RDA Resolutions RA 2007-002 (depot) RA 2008-12 RA 2009-01 RA 2010-01 (driveway) Anderson Pacific Property Anderson Pacific Property - 3 Agreements August 4, 2008 Cooperation and Repayment Agreement January 12, 2009 Accelerated Cooperation and Repayment Agreement January 12, 2009 Notice of Affordability Restriction on Transfer of Property and Declaration of Covenants and Restrictions (Recorded January 29, 2009, Recorder No. 20090268632)  “As a condition of accepting the RDLP funds, the City and Owner now desire to place restrictions upon the development and use of the Property to ensure that the development of the Project, or any other project developed on the Property, shall provide at least 28 units of ownership housing affordable to low-income households and 56 units of ownership housing affordable to moderate- income households.”  “It is anticipated that the Owner will eventually enter into a Disposition and Development Agreement with a final developer which will construct a mixed-use development consisting of retail space, a variety of housing types, including a minimum of 28 units of ownership housing affordable to low- income households and 56 units of ownership housing affordable to moderate-income households (the “Project”). It is further anticipated that any such Disposition and Development Agreement shall secure and provide for the satisfaction of the obligations set forth in this Notice & Declaration, as well as the satisfaction of the outstanding principal and interest owed the City under the Accelerated Cooperation and Repayment Agreement executed concurrently herewith.”  “USE OF PROPERTY Development of the Property shall provide at least 28 units of ownership housing affordable to Low-Income Homebuyers and 56 units of ownership housing affordable to Moderate-Income Homebuyers, which shall be occupied by Low-Income and Moderate-Income Homebuyers, respectively, for a period of at least 10 years.” Other Documents Tract Map 9926 Recorded February 23, 2010 Notes and Narrative Summary: The Anderson Pacific Property consists of approximately 5.5 acres of the former Lucky Shopping Center that was acquired with City Affordable Housing Fees. In 2005, the City loaned $8,000,000 in City Affordable Housing Fees to Livermore Village I, LLC, to help that developer acquire the Anderson Pacific Property and provide affordable housing opportunities. The loan agreement between the City and Livermore Village I, LLC was amended several times to extend the initial payoff date from May 13, 2006 to May 3, 2008. In 2008, Livermore Village I, LLC defaulted on the loan after project entitlement. Livermore Village I, LLC transferred the property to the City in lieu of foreclosure proceedings, along with the project plans and entitlements, in exchange for an additional payment of $2,100,000 in City Affordable Housing Fees for the property. An additional $100,000 in City Affordable Housing Fees was expended for the costs (title insurance, escrow, outstanding property taxes, etc.) to transfer the property to the City. The City then transferred the Anderson Pacific Property to the former-RDA by way of a Cooperation and Repayment Agreement that loaned the $10,969.763 in City Affordable Housing Fees invested in the property to the former-RDA. In 2009, the City and former-RDA entered into an Accelerated Cooperation and Repayment Agreement to restructure the loan in the original Cooperation and Repayment Agreement for the City to loan the former- RDA $5,000,000 in RDLP funds in place of and to pay off a portion of the City Affordable Housing Fees originally loaned. Anderson Pacific Property Anderson Pacific Property - 4 Notes and Narrative Summary (cont.): In 2010, as part of the property assembly for redevelopment, the Anderson Pacific Property was subdivided into three parcels known as: 1. Remainder Parcel (APN 098-0289-021-00) 2. Regional Theater Parcel (APN 098-0289-018-00), 3. Regional Theater Plaza Parcel (APN 098-0289-019-00). This information sheet only contains information for the Anderson Pacific Property prior to its subdivision into three parcels in 2010. The individual information sheets for each of the subdivided parcels contain information about those properties after the subdivision. A separate whitepaper provides information on the RDLP loan program and the City and former-RDA’s actions concerning that loan. Train Station Depot. The Train Station Depot building was located on the Remainder Parcel. It was treated as a housing asset associated with the Remainder Parcel and ultimately transferred to the City as a housing asset as part of the dissolution process for the former-RDA. Driveway Parcel. The driveway parcel was acquired from an adjacent property and was to be merged with the Remainder Parcel. It was processed as both a housing asset and as a governmental purpose asset as part of the dissolution process for the former-RDA. The driveway parcel was purchased with funds that do not have an affordable housing obligation. EXCERPTS REFLECTING PROPOSED USE Train Station Depot Relocation – Time of Loan to the former-RDA (May 14, 2007) “Staff recommends the City Council enter into a Cooperation Agreement with the Agency to loan the Agency up to $825,000 in Housing Trust Funds to purchase of the Southern Pacific Railway Depot (Depot), located at 20-22 South L Street, to facilitate the redevelopment of the former Lucky’s center and to help preserve the historic nature of the building. If approved, the Depot will be relocated to a site within the Downtown and preserved as an important historic resource for the City.” “Initially, the City will use Housing Trust funds to purchase the Depot. The City and Agency will enter into a cooperation agreement that will establish a mechanism for repayment of Housing Trust Funds by the Agency based on future revenue.” “On October 26, 2006, Council approved the Livermore Village project for the Lucky’s center. The project will be developed in two phases to allow for the construction of a mixed-use development consisting of 218± residential units (with up to 84 units of affordable housing), commercial space and artist facilities.” “..[t]he Depot will be purchased by the Redevelopment Agency and preserved as an important historic resource for the City, placing it into public ownership where its preservation will be a priority. Upon acquisition of the Depot, staff will explore sites in the Downtown for relocation of the Depot and return to Council for approval. Staff will work in partnership with the Heritage Guild to restore and renovate the Depot.” “…[u]p to $825,000 in Housing Trust funds will be approved to fund the acquisition and relocation of the Depot. Preliminary analysis indicates that approximately 40 housing units could be built by relocating thd Depot offsite. This would increase the tax increment and bring additional households to the Downtown core. Staff estimates that once the Depot is relocated offsite, allowing for an additional 40 units onsite, the project value of the 40 housing units will have an estimated assessed value of $20,000,000, bringing in approximately $120,000 per year in additional tax increment to the Redevelopment Agency.” Anderson Pacific Property Anderson Pacific Property - 5 Proposed Use – Time of City Acquisition (May 12, 2008) “Staff recommends the City Council adopt a resolution allowing the City Manager to enter into a Purchase and Sale Agreement between James Anderson of Livermore Village I, LLC and the City of Livermore to transfer ownership of the Livermore Village Project at 2093 Railroad Avenue from Anderson to the City of Livermore.” “Anderson Pacific has developed plans and designs for a 281 unit attached housing development with an affordable housing component, an artist community center and approximately 7,000 square feet of retail and office space.” “Market conditions have changed dramatically since the project received its entitlements. Sales of attached housing units have declined throughout the nation and specifically in the Bay Area. Due mainly to this downtown in the market, Anderson Pacific has been unable to secure construction financing for the Livermore Village Project.” ‘Without funds for construction, Anderson Pacific has been unable to proceed with the development of the project and thus is unable to repay the outstanding City loan by its due date. As a result, on February 27, 2008, Anderson Pacific requested that in lieu of default of the City note, the City purchase his remaining interest in the site and take ownership of the property, project plans and entitlement. If approved, the City would purchase the remaining ownership interests in the project for $2,100,000 in lieu of it going into foreclosure. As holder of the project’s first note, the City would assume the $8,000,000 note, along with the $2,237,812 in accrued interest. An additional $100,000 in funds is being requested to cover City costs of transferring the project (title insurance, escrow and outstanding property taxes).” “Upon transfer of the site to the City, staff will prepare a request for proposals that will be used to identify potential new developers. Priority will be given to those developers with the best overall experience in developing a project that will meet the goals of the Downtown Specific Plan, would return the highest amount of tax increment as quickly as possible, and would be able to pay off the outstanding City loans and move forward with construction of the project.” Transfer of Anderson Pacific Property from City to the former-RDA (August 4, 2008) “The proposed Cooperation and Repayment Agreement between the City of Livermore and the Redevelopment Agency will establish the terms for the property transfer and the repayment of the loan to the City of Livermore by the Redevelopment Agency.” “Under the proposed Cooperation Agreement, the City agrees to transfer title to the property to the Redevelopment Agency. The Redevelopment Agency agrees to reimburse the City for the costs of the property’s acquisition through an initial loan and subsequent repayment agreement. To make the City’s Affordable Housing fund whole, the Agency has agree to pay an interest rate of 3.5% on the original $8,000,000, which would have been the estimated value of the accrued interest had the investment remained in the Affordable Housing fund.” “It is anticipated that the Redevelopment Agency will enter into a Disposition and Development Agreement with a new developer which will construct a mixed-use development consisting of retail space, a variety of housing types, including live-work and flex units, and potentially a regional performing arts theater.” RDLP Funding Post Acquisition (January 12, 2009) “In 2007, the City was awarded State of California Residential Development Loan Program (RDLP) funds for site acquisition and pre-development expenses for the Livermore Village project. Upon Council/Agency approval staff will draw down the funds from the State. The RDLP funds will be provided at a below market rate interest loan to the City who in turn will loan these funds to the Agency for site acquisition and predevelopment expenses associated with Livermore Village and to pay off a portion of the Housing Trust funds (F611) that are currently being loaned to the Agency.” Anderson Pacific Property Anderson Pacific Property - 6 RDLP Funding Post Acquisition (January 12, 2009) (cont.) “Conditions for accepting the RDLP loan funds require that the project provide 28 units of ownership housing affordable to low-income households and 56 units of ownership housing affordable to moderate-income households for a minimum of ten years. Livermore Village currently has entitlements for 281 units of housing which allows the RDLP and lnclusionary requirement to both be satisfied. The 56 units of moderate- income housing would be delivered through the general production of units and in order to meet the requirements of the RDLP the units would be deed-restricted for a minimum of ten years. To document this requirement, the Agency will record a "Notice of Affordability Restriction on Transfer of Property and Declaration of Covenants and Restrictions " on the Property with the City outlining the terms and conditions of the RDLP funding. “…up to $5,000,000 of the RDLP fund will be used for site acquisition and predevelopment expenses associated with the Livermore Village and to pay off a portion of the Housing Trust funds (F611) that are currently loaned to the Agency.” Driveway Parcel – Time of Acquisition (January 11, 2010) “The acquired property will be incorporated into the adjacent Agency-owned Livermore Village site and will be used to greatly improve future access for both the regional theater and the proposed future housing development through the creation of a public street and sidewalks running east to west along the Livermore Village site.”