ACTION REQUESTED:
Title
Communication from the City Manager with a Request to ADOPT an ORDINANCE Approving the 800 ADAMS LLC - REDEVELOPMENT AGREEMENT. (Council District 1)
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BACKGROUND: 800 ADAMS LLC, led by Casey Baldovin, is in the process of redeveloping 800 and 810 SW Adams, subject to financing. The renovation includes a mixed-use redevelopment of the Federal Warehouse (6 stories) and the Mitchell Fabric (1 story) buildings. The renovated buildings include:
a) 86,810 sf of residential with 93 market-rate residential units (15 - studios, 51- one-bedrooms, and 26 - two-bedrooms) on floors 1 to 6;
b) 12,630 sf of commercial space on the first floor; and
c) 32,000 sf of basement parking for 63 leased spaces. Additional parking will be made available across the street behind the Grawey Building at 809 - 833 SW Adams.
The project's budget is estimated at $27.6 million and will be financed with private equity of 30% and debt financing of 70%. The total amount of TIF eligible cost is $23.4 million. Demolition and preliminary construction are underway to meet leasing deadlines since 50% of commercial leases are required for bank financing to take place. 800 ADAMS LLC has obtained letters-of-intent to lease out the commercial space.
FINANCIAL IMPACT: 800 ADAMS LLC has presented its financials to City staff and have requested tax increment financing (TIF) reimbursement for 15 years (see Schedule 3 of the attached Redevelopment Agreement (RDA)). The proposed 15-year reimbursement includes 100% of the TIF increment for the first 3 years (2024, 2025, & 2026) to get financially stabilized, and then 50% of the TIF increment for 12 years. After the 15-year reimbursement the developer would receive no additional incentive. The project is estimated to generate $7.3 million in property tax increment over the 15-year reimbursement period, of which the City and Developer will equally share. The Redeveloper is expected to receive $3.6 million of a total ...
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