Consent 1.I.
Regular City Council Meeting
- Meeting Date:
- 12/14/2009
- TITLE
- Downtown Revolving Loan Fund Recommendation for Babcock, LLC
- PRESENTED BY:
- Patrick M. Weber
- Department:
- City Hall Administration
Presentation:
PROBLEM/ISSUE STATEMENT
The Downtown Revolving Loan Committee met on November 16, 2009, and recommends approving loans to Babcock, LLC.
Babcock, LLC is requesting two loans from the Downtown Revolving Loan Fund for the purpose of remodeling the Babcock Building for retail and residential space located at 115 North Broadway. Babcock, LLC is in the process of completing the theatre remodel and restoration and has plans to continue renovation of the retail and residential spaces within the building. The total project costs will be approximately $3,575,000, of which the Downtown Revolving Loan Fund will loan no more than $400,000 in two separate loans. The first loan will be for $150,000 with a 5% interest rate, 20 year amortization and a balloon payment on June 1, 2010. The second loan will be for $250,000 with a 5% interest rate, 20 year amortization and a 10 year balloon payment. Personal guarantees of all four members of Babcock LLC will be required. The Downtown Revolving Loan will be subordinate to a bank loan of approximately $1,000,000.
Babcock, LLC is requesting two loans from the Downtown Revolving Loan Fund for the purpose of remodeling the Babcock Building for retail and residential space located at 115 North Broadway. Babcock, LLC is in the process of completing the theatre remodel and restoration and has plans to continue renovation of the retail and residential spaces within the building. The total project costs will be approximately $3,575,000, of which the Downtown Revolving Loan Fund will loan no more than $400,000 in two separate loans. The first loan will be for $150,000 with a 5% interest rate, 20 year amortization and a balloon payment on June 1, 2010. The second loan will be for $250,000 with a 5% interest rate, 20 year amortization and a 10 year balloon payment. Personal guarantees of all four members of Babcock LLC will be required. The Downtown Revolving Loan will be subordinate to a bank loan of approximately $1,000,000.
ALTERNATIVES ANALYZED
The Council may: Approve the loan; or Not approve the loan.
FINANCIAL IMPACT
Subsequent to approval of this loan, the loan fund will have a balance available for disbursement of approximately $260,000. (current inter-credit loan balance outstanding of $740,000 which has a line of credit available up to $1,600,000, not yet disbursed of $400,000 to Babcock, LLC, and not yet disbursed of $200,000 to EB Ventures)
RECOMMENDATION
The Downtown Revolving Loan Committee recommends that council approve two loans to Babcock, LLC totalling no more than $400,000 and requiring personal guarantees.