Item A: URA - Review of Responses to the 10th & Charnelton Request for Proposals

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Sustainable Development Sockeye Development indicates that they will follow LEED principals to establish a program for sustainability. Elements such as recaptured rainwater, permeable paving, Energy Star roof, high efficiency appliances, drought tolerant/native landscaping, low VOC paints and adhesives, recycled content materials, and locally manufactured materials are cited as potential sustainable building features. Timeliness Sockeye Development anticipates a project completion date of 2009. The developers have experience with complex, multi-layered financing strategies. The largest impediment for the project timing is likely to be an identified financing gap estimated at $3.36 million. Financial Feasibility Sockeye Development is proposing a financing structure which includes multi-family housing revenue bonds, 4% low income housing tax credits ($3.9 million in tax credit equity), a $2 million URA loan, and private equity in the amount of $1,575,000. Sockeye has preliminarily projected a $3.36 million project financing gap. Options identified by Sockeye for closing the gap include elimination of the underground parking, reduction in the scale of the project, phasing the project, and other financing sources. Sockeye has had preliminary discussions with FannieMae regarding higher loan-to-value ratios and other strategies to narrow a portion of the projected gap. Net Financial Cost/Benefit Income: Sockeye has proposed a purchase price of $100,000. Assuming that a 10-years of property tax exemption would be available for a majority of the project, urban renewal tax increment revenue from the project would likely be limited to the 25,500 square feet of retail uses (estimated at $70,000 per year.) Cost: Sockeye is proposing that URA contribute approximately $870,000 in land value to the project. Sockeye has also indicated that they would seek a $2 million urban renewal loan from the City, and a property tax exemption under the Multi-Unit Property Tax Exemption (MUPTE) program. Sockeye has also requested a waiver of SDCs. Proposal Strengths • Developer experience with similar projects • Strong project team • Dense housing use which incorporates affordable rents • Desirable urban design features • Financial capacity of developer evidenced by completed projects • Potential to stimulate other investment • Sustainable building features proposed • Overall responsiveness to the RFP objectives Proposal Weaknesses • Financial feasibility (financing gap) • Level of subsidy requested L:\CMO\2006 Council Agendas\M061016\S0610161-URASpecMeet.doc