Agenda - Council - 03/24/2015 - Laserfiche WebLink

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BRIGGS AND MORGAN (g) Subordination Agreement. The Development Agreement gave the Buyer's lender, PNC Bank, an option to have the Development Agreement be prior to or subordinate to the mortgage PNC Bank will receive from Residence at the COR Apartments LLC. PNC Bank has elected to have the Development Agreement have priority over the mortgage so that a foreclosure of the mortgage will not extinguish the Development Agreement. The City, PNC Bank and Residence at the COR Apartments LLC are executing the Subordination Agreement to evidence that understanding. (h) Maintenance Agreement. When the City constructed the addition to the parking ramp, the City, in anticipation of the development of the Residence at the COR, used footings that were capable of supporting both the parking ramp and the apartment building. The intent was to locate the footings on the common boundary line between the parking ramp property and the apartment property so that the parking ramp and the apartment building could each be constructed on the footings and on its side of the property line. In fact, the parking ramp and the common footing were constructed approximately 1.33 feet into the parking ramp property. When that fact was discovered, the City granted F&C Apartments, LLC an easement to allow the Residence at the COR building to encroach 1.33 feet onto the City property so that the building could be constructed using the shared footings. The grant of easement contemplated that when construction of the apartment was complete, the parties would enter into an agreement that addressed any shared maintenance issues associated with the fact that the two buildings abut one another. The primary maintenance issue is the maintenance of a "cap" at the top of the walls so that rain, snow, ice and debris does not make its way between the two walls. This Agreement addresses that maintenance issue. (i) Encroachment Easement Amendment. The grant of encroachment easement contemplated that after completion of the Residence at the COR, the City and F&C Apartments would replat their respective lots to relocate the lot line, such that neither parties' building encroached onto the other parties' property. That did not occur, and because PNC Bank will ultimately assign a portion of its loan to Residence at the COR Apartments, LLC to Fannie Mae and because it is extremely difficult if not impossible to get Fannie Mae to sign documentation after the loan has closed, we think it is unlikely that the parties will be able to complete the contemplated replatting. Therefore, the Grant of Easement Agreement is being amended to provide a permanent easement for the existing encroachment of the building. 4. Resolution Number 4. When F&C Ramsey, LLC repays Loan No. 1 and Loan No. 2, the City must return the original Notes to F& C and must release the security interest it holds on the membership interest in F&C Ramsey Apartments, LLC. This Resolution authorizes the Mayor and City Administrator to sign the documents and take the actions necessary to evidence the repayment of those loans. 5. Resolution Number 5. Because there are numerous documents for the City to sign and because it may be necessary to make corrections or minor modifications to the documents prior to closing, Resolution No. 5 authorizes the Mayor and the City Administrator to approve minor modifications to the documents subsequent to the Council's adoption of the Resolution. 4 6983737v1