Item B: Beam Development Project Update

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EURA UGENE RBAN ENEWAL GENCY AIS GENDA TEM UMMARY Work Session: Beam Development Project Update Meeting Date: December 14, 2009 Agenda Item Number: B Department: Planning & Development Staff Contact: Nan Laurence www.eugene-or.gov Contact Telephone Number: 682-5340 ISSUE STATEMENT The Urban Renewal Agency (URA) and Beam Development signed a Purchase and Sale Agreement (PSA) in May 2008, for Beam’s purchase of the Centre Court Building and adjacent vacant parcel, and the Washburne Building. The PSA and subsequent amendments require that Beam begin construction on the Centre Court and adjacent site no later than December 1, 2009. The URA is asked to again revise the PSA consistent with Beam’s request to allow for the start of demolition by February 1, 2010, and the start of construction by May 1, 2010, to allow phasing of the project beginning with the rehabilitation on the Centre Court Building, and other related project modifications. An outline of terms for the proposed PSA Amendment is included with the AIS as Attachment A; Beam’s letter requesting the amendments is included as Attachment B. BACKGROUND Beam purchased the properties from the URA in July 2008, for a total purchase price of $3.6 million (Centre Court $1,946,000; vacant site $454,000; and Washburne Building $1,200,000). The URA provided financing to Beam totaling $3.55 million for their acquisition of the properties and $350,000 for predevelopment costs. The sources of funds for the URA’s financing included federal Housing and Urban Development Section 108 (HUD 108) loan funds ($2.7 million), Brownfield Economic Development Initiative (BEDI) grant funds ($440,000), and Downtown Revitalization Loan Program funds ($754,000, including the predevelopment loan). To date, Beam has made all required payments on these loans. At this time, three main changes are proposed for the project, as described in Attachment A: ? Timing and phasing ? The amount of private financial investment ? Distribution of net proceeds from the project Timing and Phasing The PSA currently includes a provision that rehabilitation of the Centre Court and new construction on the adjacent site begin no later than December 1, 2009. (This date was extended from May 1, nd 2009, through the 2 PSA amendment.) Due to the continued economic downturn and resulting market instability, Beam has requested an additional six months to submit building permits (May 1, 2010). Beam aims to start before this date, as soon as the HUD 108 funds are available. Beam is Z:\CMO\2009 Council Agendas\M091214\S091214B.doc