HomeMy WebLinkAboutCC Resolution 14986 (Continuing City Loans from Centertown Project at 855 C Street)1
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RESOLUTION NO. 14986
RESOLUTION OF THE SAN RAFAEL CITY COUNCIL AGREEING TO ACCEPT A NEW
$909,876 PROMISSORY NOTE FROM CENTERTOWN II, LP, REPRESENTING THE
REMAINING OBLIGATIONS UNDER TWO OUTSTANDING PROMISSORY NOTES
FROM CENTERTOWN ASSOCIATES, LTD., AND RELATED MATTERS
WHEREAS, the City of San Rafael, as successor housing agency to the former San Rafael
Redevelopment Agency (“SRRA”), is the fee owner of that certain approximately 0.98-acre lot at
855 C Street in downtown San Rafael (“Centertown Land”) on which the Centertown project is
located; and
WHEREAS, the City Council has adopted Ordinance 2000, Approving and Authorizing the
Mayor to Execute a Ground Lease of the Real Property at 855 C Street, San Rafael (Centertown)
to Centertown II, LP (Centertown II), in order to provide BRIDGE/EAH the opportunity to re-
syndicate and refinance the Centertown project to provide flood improvements, ADA
improvements, and other necessary ongoing maintenance; and
WHEREAS, the City currently holds two outstanding promissory notes from current
Centertown lessee Centertown Associates, Ltd. (“Centertown Ltd.): a $631,000 unsecured
promissory note, dated June 2, 2021, all of which (together with accrued interest) is outstanding;
and a $303,000 secured promissory note, dated August 20, 1990, of which $219,982 in principal
(plus accrued interest) is outstanding; and
WHEREAS, as part of the new Centertown transaction, it is proposed that the remaining
amounts under the two Centertown Ltd. notes be combined into a single new $909,876
Promissory Note from Centertown II, with the current notes being cancelled and the current deed
of trust securing the $303,000 note being released; and
WHEREAS, the new Promissory Note will: bear interest at 1.74% per annum, be payable
from the City’s prorata percentage of certain “Residual Receipts” from the Centertown project (as
defined in the new Note), have a term of 57 years, be secured by a new Leasehold Deed of Trust
and accompanied by a new affordable housing Regulatory Agreement, and be subordinated to
larger loans from the project’s senior lenders; and
WHEREAS, the foregoing matters, are all closing conditions to the new Centertown
transaction;
NOW, THEREFORE, BE IT RESOLVED that the City Council hereby approves, and
authorizes the Mayor and/or City Manager to take all actions required to accept a new $909,876
Promissory Note from Centertown II, LP; cause the new Promissory Note to be secured by a new
Leasehold Deed of Trust and accompanied by a new affordable housing Regulatory Agreement,
all substantially in the form included with the staff report for this Resolution; cancel the two current
$631,000 and $303,000 notes from Centertown Ltd.; and release the current deed of trust
securing the $303,000 note, all in a form subject to approval by the City Attorney;
AND BE IT FURTHER RESOLVED that the City Council hereby approves, and authorizes
the Mayor and/or City Manager to execute, all other documents reasonably required to carry out
the intent and purposes of the foregoing, in a form approved by the City Attorney.
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I, LINDSAY LARA, City Clerk of the City of San Rafael, hereby certify that the foregoing
resolution was duly and regularly introduced and adopted at a regular meeting of the City Council
held on the 18th day of October, 2021, by the following vote to wit:
AYES: COUNCILMEMBERS: Bushey, Hill, Kertz & Mayor Kate
NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: Llorens Gulati
LINDSAY LARA, City Clerk