HomeMy WebLinkAboutPark Avenue Lofts, LLC-6/8/2015Please return this copy to:
City Clerk & Finance Dept.
715 Mulberry St.
Waterloo, IA 50703
Prepared by Christopher S. Wendland, P.O. Box 596, Waterloo, IA 50704 Phone (319) 234-5701
DEVELOPMENT AGREEMENT
This Development Agreement (the "Agreement") is entered into as ofd
2015 by and between Park Avenue Lofts, LLC (the "Company") and the City of
Waterloo, Iowa (the "City").
RECITALS
A. City considers economic development within the City a benefit to the
community and is willing for the overall good and welfare of the
community to provide financial incentives so as to encourage that goal.
B. Company is willing and able to finance and construct a building and
related improvements on property that it will acquire, legally described on
Exhibit "A" (the "Property"), located in the Downtown Waterloo Urban
Renewal and Redevelopment Plan Area.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants set forth herein,
the parties agree as follows:
1. Improvements by Company. Company shall renovate the Property so
that, upon completion, it will contain no less than eleven (11) residential apartments,
and shall make related parking, landscape, and other improvements to the building and
grounds (the "Improvements"). The Improvements shall be constructed in accordance
with all applicable City, state, and federal building codes and shall comply with all
applicable City ordinances and other applicable law. It is contemplated that the value
added by the Improvements will, upon substantial completion, result in an assessed
value of no less than $1,100,000. The Improvements and all site preparation and
development -related work as contemplated by this Agreement are collectively referred
to as the "Project".
2. Timeliness of Construction. The parties agree that Company's
commitment to undertake the Project and to construct the Improvements in a timely
manner constitutes a material inducement for the City to extend the development
incentives provided for in this Agreement, and that without said commitment City would
not have done so. Company must obtain a building permit and begin construction no
later than July 1, 2015 (the "Project Start Date"), and construction of Improvements on
the Property shall be completed by December 31, 2016 (the "Project Completion Date").
If, by the Project Start Date, Company has not in good faith begun construction of the
Improvements upon the Property, then the City may terminate this Agreement following
Company's failure to begin construction within thirty (30) days following written notice of
default from City. If development has commenced by the Project Start Date or within
any agreed period of extension and is stopped and/or delayed as a result of an act of
God, war, civil disturbance, court order, labor dispute, fire, or other cause beyond the
reasonable control of Company, the requirement that construction is to be completed by
the Project Completion Date shall be tolled for a period of time equal to the period of
such stoppage or delay, and thereafter if construction is not completed within the
allowed period of extension the City may terminate this Agreement following Company's
failure to diligently undertake construction within thirty (30) days following written notice
of default from City. If at any time Company fails to diligently undertake construction
and other activities necessary for completion of the Project, then City may terminate this
Agreement following Company's failure to resume and diligently carry on construction
within thirty (30) days following written notice of default from City.
3. Water and Sewer. Company will be responsible for extending water and
sewer service to any location on the Property and for payment of any associated
connection fees.
4. Minimum Assessment Agreement. Company acknowledges and
agrees that it will pay when due all taxes and assessments, general or special, and all
other lawful charges whatsoever levied upon or assessed or placed against the
Property. Company further agrees that, prior to the date set forth in Section 2 of
Exhibit "B", it will not seek or cause a reduction in the taxable valuation for the Property,
which shall be fixed for assessment purposes, below the aggregate amount of
$1,100,000 ("Minimum Actual Value"), through:
(i) willful destruction of the Property, Improvements, or any part of
either;
(ii) a request to the assessor of Black Hawk County; or
(iii) any proceedings, whether administrative, legal, or equitable, with
any administrative body or court within the City, Black Hawk
County, the State of Iowa, or the federal government.
Company agrees to sign an agreement substantially in the form attached as Exhibit "B"
concurrently with execution of this Agreement.
5. Tax Rebates. Provided that Company has completed the Improvements
as set forth herein and has executed the Minimum Assessment Agreement as set forth
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in Section 4, City agrees to rebate property tax (with the exceptions noted below) for a
period of ten (10) years at 70% per year for any taxable value over the January 1, 2015
value of $614,210. Rebates are payable in respect of a given year only to the extent
that Company has actually paid general property taxes due and owing for such year.
To receive rebates for a given year, Company must, within twelve (12) months after the
tax payment due date, submit a completed rebate request to City on the form provided
by or otherwise satisfactory to City, or the rebate will be forfeited at City's option. The
first year in which a rebate may be given ("Year One") shall be the first full year for
which the assessment is based on the completed value of the Improvements and not a
prior year for which the assessment is based solely on the value of the land or on the
value of the land and a partial value of the Improvements, due to partial completion of
the Improvements or a partial tax year.
The taxable value of the Property as a result of the Improvements must
be increased by a minimum of 10% and must increase the annual tax by a minimum of
$500.00. This rebate program is not applicable to any special assessment levy, debt
service levy, or any other levy that is exempted from treatment as tax increment
financing under the provisions of applicable law.
6. Obligations Contingent. Each and every obligation of City under this
Agreement is expressly made subject to and contingent upon City's completion of all
procedures, hearings and approvals deemed necessary by City or its legal counsel for
amendment of the urban renewal plan applicable to the Property and/or project area, all
of which must be completed within 180 days from the date this Agreement is approved
by the City council. If such completion does not occur, then any conveyance, benefit or
incentive of any type provided by City hereunder within said 180 -day period is subject to
reverter of title, revocation, repayment or other appropriate action to restore such
property, benefit or incentive to City, and Company agrees to cooperate diligently and in
good faith with any reasonable request by City to effectuate the restoration of same, or
failing such restoration Company agrees to be liable for same or for the fair value
thereof, plus interest on any sums owing at the rate of 10% per annum commencing
with the date of demand for payment, if said payment is not remitted to City within 30
days.
7. Representations and Warranties of City. City hereby represents and
warrants as follows:
A. City is not prohibited from consummating the transaction
contemplated in this Agreement by any law, regulation, agreement, instrument,
restriction, order or judgment.
B. Each person who executes and delivers this Agreement and all
documents to be delivered hereunder is and shall be authorized to do so on
behalf of City.
8. Representations and Warranties of Company. Company hereby
represents and warrants as follows:
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A. Company is not prohibited from consummating the transaction
contemplated in this Agreement by any law, regulation, agreement, instrument,
restriction, order or judgment.
B. Company is duly organized, validly existing, and in good standing
under the laws of the state of its organization and is duly qualified and in good
standing under the laws of the State of Iowa.
C. Company has full right, title, and authority to execute and perform
this Agreement and to consummate all of the transactions contemplated herein,
and each person who executes and delivers this Agreement and all documents
to be delivered to City hereunder is and shall be authorized to do so on behalf of
Company.
9. Materiality of Company's Promises, Covenants, Representations,
and Warranties. Each and every promise, covenant, representation, and warranty set
forth in this Agreement on the part of Company to be performed is a material term of
this Agreement, and each and every such promise, covenant, representation, and
warranty constitutes a material inducement for City to enter this Agreement. Company
acknowledges that without such promises, covenants, representations, and warranties,
City would not have entered this Agreement. Upon breach of any promise or covenant,
or in the event of the incorrectness or falsity of any representation or warranty, City
may, at its sole option and in addition to any other right or remedy available to it,
terminate this Agreement and declare it null and void.
10. Notices. Any notice under this Agreement shall be in writing and shall be
delivered in person, by overnight air courier service, by United States registered or
certified mail, postage prepaid, or by facsimile (with an additional copy delivered by one
of the foregoing means), and addressed:
(a) if to City, at 715 Mulberry Street, Waterloo, Iowa 50703, facsimile
number 319-291-4571, Attention: Mayor, with copies to the City Attorney and the
Community Planning and Development Director.
(b) if to Company, at 2202 College Street, Cedar Falls, Iowa, 50613,
facsimile number , Attention: Brent Dahlstrom, with a copy to Eric
Johnson, Esq., Beecher Law Firm, 620 Lafayette Street, Waterloo, Iowa, 50703.
Delivery of notice shall be deemed to occur (i) on the date of delivery when delivered in
person, (ii) one (1) business day following deposit for overnight delivery to an overnight
air courier service which guarantees next day delivery, (iii) three (3) business days
following the date of deposit if mailed by United States registered or certified mail,
postage prepaid, or (iv) when transmitted by facsimile so long as the sender obtains
written electronic confirmation from the sending facsimile machine that such
transmission was successful.
11. No Joint Venture. Nothing in this Agreement shall, or shall be deemed
or construed to, create or constitute any joint venture, partnership, agency,
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employment, or any other relationship between the City and Company nor to create any
liability for one party with respect to the liabilities or obligations of the other party or any
other person.
12. Amendment, Modification, and Waiver. No amendment, modification,
or waiver of any condition, provision, or term of this Agreement shall be valid or of any
effect unless made in writing, signed by the party or parties to be bound or by the duly
authorized representative of same, and specifying with particularity the extent and
nature of the amendment, modification, or waiver. Any waiver by any party of any
default by another party shall not affect or impair any rights arising from any subsequent
default.
13. Severability. Each provision, section, sentence, clause, phrase, and
word of this Agreement is intended to be severable. If any portion of this Agreement
shall be deemed invalid or unenforceable, whether in whole or in part, the offending
provision or part thereof shall be deemed severed from this Agreement and the
remaining provisions of this Agreement shall not be affected thereby and shall continue
in full force and effect. If, for any reason, a court finds that any portion of this
Agreement is invalid or unenforceable as written, but that by limiting such provision or
portion thereof it would become valid and enforceable, then such provision or portion
thereof shall be deemed to be written, and shall be construed and enforced, as so
limited.
14. Captions. All captions, headings, or titles in the paragraphs or sections
of this Agreement are inserted only as a matter of convenience and/or reference, and
they shall in no way be construed as limiting, extending, or describing either the scope
or intent of this Agreement or of any provisions hereof.
15. Binding Effect. This Agreement shall be binding and shall inure to the
benefit of the parties and their respective successors, assigns, and legal
representatives.
16. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same instrument.
17. Entire Agreement. This Agreement, together with the Minimum
Assessment Agreement attached hereto as Exhibit "B", constitutes the entire
agreement of the parties and supersedes all prior or contemporaneous negotiations,
discussions, understandings, or agreements, whether oral or written, with respect to the
subject matter hereof.
18. Time of Essence. Time is of the essence of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Development
Agreement by their duly authorized representatives as of the date first set forth above.
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CITY OF W ;TERLOO, IOWA PARK AVENUE LOFTS, LLC
By:
Ernest G. Clark, Mayor
Attest:
Suzy Sch res, City C
6
By:
Brent Dahlstrom, Managing Member
EXHIBIT "A"
Legal Description of Property
Assessor parcel nos. 8913-24-356-004 and 8913-24-356-013, legally described as:
Lots 1 and 4, and the SEIy 8 feet of Lots 2 and 3, in Block 30, Original Plat, East Side of
the Cedar River, Waterloo, Iowa;
and
Lot 5 and the SEIy 8 feet of Lot 6, in Block 30, Original Plat, East Side of the Cedar River,
Waterloo, Iowa, as more particularly described in that Plat of Survey recorded April 19,
2013 as Doc. No. 2013-21720.
EXHIBIT "B"
MINIMUM ASSESSMENT AGREEMENT
This Minimum Assessment Agreement (the "Agreement") is entered into as of
,) lAc2_ .c , by and among the CITY OF WATERLOO, IOWA ("City"),
Park Avenue Lofts, LLC ("Developer"), and the COUNTY ASSESSOR of the City of
Waterloo, Iowa ("Assessor").
WITNESSETH:
WHEREAS, on or before the date hereof the City and Developer have entered
into a development agreement (the "DA") regarding certain real property, described in
Exhibit "A" thereto, located in the City; and
WHEREAS, it is contemplated that pursuant to the DA, the Developer will
undertake the development of an area ("Project") within the City and within the
"Downtown Waterloo Urban Renewal and Redevelopment Plan Area"; and
WHEREAS, pursuant to Iowa Code § 403.6, as amended, the City and the
Developer desire to establish a minimum actual value for the land and the building(s)
pursuant to this Agreement and applicable only to the Project, which shall be effective
upon substantial completion of the Project and from then until this Agreement is
terminated pursuant to the terms herein and which is intended to reflect the minimum
actual value of the land and buildings as to the Project only; and
WHEREAS, the City and the Assessor have reviewed the preliminary plans and
specifications for the improvements (the "Improvements") which the parties contemplate
will be erected as a part of the Project.
NOW, THEREFORE, the parties hereto, in consideration of the promises,
covenants, and agreements made by each other, do hereby agree as follows:
1. Upon substantial completion of construction of the Improvements by the
Developer, the minimum actual taxable value which shall be fixed for assessment
purposes for the land and Improvements to be constructed thereon by the Developer as
a part of the Project shall not be Tess than $1,100,000.00 ("Minimum Actual Value") in
the aggregate until termination of this Agreement. The parties hereto agree that
construction of the Improvements will be substantially completed on or before
December 31, 2016, unless extended by mutual written agreement of the parties.
2. The Minimum Actual Value herein established shall be of no further force
and effect, and this Minimum Assessment Agreement shall terminate, on December 31,
2036. Nothing herein shall be deemed to waive the Developer's rights under Iowa
Code § 403.6, as amended, to contest that portion of any actual value assignment
made by the Assessor in excess of the Minimum Actual Value established herein. In no
event, however, shall the Developer seek or cause the reduction of the actual value
assigned below the Minimum Actual Value established herein during the term of this
Agreement.
The City shall not unreasonably withhold its consent to permit the
Developer to contest its taxable valuations in full, commencing with the assessment of
January 1, 2037.
3. This Agreement shall be promptly recorded by the City with the Recorder
of Black Hawk County, Iowa. The City shall pay all costs of recording.
4. Neither the preambles nor provisions of this Agreement are intended to, or
shall be construed as, modifying the terms of the Development Agreement.
5. This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of the parties.
CITY OF W TERLOO, IOWA
By:
L J/
Ernest G. lark, Mayor
Attest:
Suzy Sc) ares, City Clerk
PARK AVENUE LOFTS, LLC
Brent Dahlstrom, Managing Member
[acknowledgments on next page]
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STATE OF IOWA
) ss.
COUNTY OF BLACK HAWK
This record was acknowledged before me on
3 0 r-9.- e , 2015 by Ernest G.
Clark and Suzy Schares, as Mayor and City Clerk, respectively, of the City of Waterloo, Iowa.
iow
NANCY HIGBY
COMMISSION NO.788229
MY COM ' ION
Notary Public
STATE OF IOWA )
) ss.
COUNTY OF BLACK HAWK
This record was acknowledged before me on April 13, 2015, 2015 by Brent Dahlstrom, as
Managing Member of Park Avenue Lofts, LLC.
3
Notary Public
BARBARA BARA J MOSTEK
4r.z 4 oiltS:�!O! NO.72 408
i Y COMi SSIOi I EVIRES
;,13i1r Y 15, 2J17
CERTIFICATION OF ASSESSOR
The undersigned, having reviewed the plans and specifications for the
improvements to be constructed and the market value assigned to the land upon which
the improvements are to be constructed for the development, and being of the opinion
that the minimum market value contained in the foregoing Minimum Assessment
Agreement appears reasonable, hereby certifies as follows: The undersigned
Assessor, being legally responsible for the assessment of the property subject to the
development, upon completion of improvements to be made on it and in accordance
with the Minimum Assessment Agreement, certifies that the actual value assigned to
such land and building upon completion of the development shall not be less than One
Million One Hundred Thousand Dollars ($1,100,000.00) in the aggregate, until
termination of this Minimum Assessment Agreement.
STATE OF IOWA
) ss.
COUNTY OF BLACK HAWK
A s-ssor for Black Hawk County, Iowa
Date
Subscribed and sworn to before me on 6 ---/e , 2015 by T.J.
Koenigsfeld as Assessor for Black Hawk County, Iowa.
Nota
Public
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DEBORAH L. BOECKMANN
MY COMMISSION NO. 185766
MY COyl�l$SjON�EXPIRES
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