Item 6: Beam Development - Laserfiche WebLink

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8. Project Description: The PSA shall include a commitment from Beam to move forward with a project consistent with their proposal, including rehabilitation of the Centre Court building and a newly constructed building of approximately 75,000 square feet on the adjacent parcel. The Centre Court building will be designed for retail, office, and sub-surface parking consistent with the design elevations submitted in Beam’s February 2007 RFQ response. The adjacent building will also be designed for retail, office, and sub-surface parking. 9. Project Timing: Beam shall commence construction of the project no later than spring 2009, and complete construction no later than two years after the signing of the PSA. 10. Reversionary Clause: In the event that Beam does not meet the construction and completion timeline included in the PSA, the URA would have the right to re-purchase the property. Beam has estimated the total construction costs for the renovation of the Centre Court building and the new adjacent building to be approximately $33 million. Beam will likely defer improvements to the Washburne Building until after the Centre Court renovation and new construction on the adjacent lot are completed. The URA’s financial participation in the project would be limited to approximately $10 million in financing provided to Beam for acquisition of property and renovation/construction, plus transaction costs and funding of a debt service reserve account for the HUD Section 108 loan. The Beam financing would be structured as interest bearing, secured loans that would be repaid from income derived from the completed project. The proposed source of funding includes proceeds from the HUD Section 108 loan ($8 million) and the BEDI grant ($2 million). The HUD Section 108 program includes stringent loan underwriting criteria that will require the project to include adequate collateral and debt service coverage. The project would also have to meet a HUD national objective (elimination of slums and blight or job creation). On July 23, 2007, City Council approved the use of HUD Section 108 and BEDI funds for acquisition of the properties. This action was preceded by a July 16 public hearing at council. The proposed construction loan (URA Loan #2) would require a separate HUD application request including a public hearing and council resolution prior to HUD review and approval. The total cost of the Beam project (both Centre Court and Washburne) is approximately $38 million. The following are summaries of sources and uses for the acquisition of property and renovation/ construction: Property Acquisition SOURCES USES HUD Section 108 Loan $ 2,510,000 Acquire Centre Court Property $ 2,400,000 BEDI Grant 636,000 Acquire Washburne Bldg 1,200,000 Downtown Loan Program 454,000 Total Sources $ 3,600,000 Total Uses $ 3,600,000 Y:\CMO\2008 Council Agendas\M080519\S0805196.doc