Summary:
Pursuant to Chapter 13, Section 7 of the Charter of the City of Orlando, notice was given in the Orlando Sentinel regarding this hearing concerning the proposed disposition by the City of Orlando of the land for the former Peppertree Circle Apartment complex located at 1471 Mercy Drive and the former Peppertree Shores Apartment complex located at 1014 Mercy Drive. See attached Location Map.
In 2015 the City acquired the Peppertree Shores Apartment Complex (1014 Mercy Drive) and the Peppertree Circle Apartment Complex (1471 Mercy Drive) from FNMA. The City’s combined purchase price for both parcels was $993,368. In the summer of 2015, the City solicited proposals from parties interested in redeveloping the properties. The proposals received did not meet the City’s goals for redevelopment of the sites.
Since the vacant buildings did not meet minimum housing standards, were uninhabitable, and were the cause of significant blight in the community, the City demolished the buildings to eliminate the blight and foster future redevelopment of the sites.
The City commissioned a Mercy Drive Vision Plan for the Mercy Drive corridor that includes the two parcels. The Mercy Drive Vision Plan was completed at the end of 2017.
In April 2018, the City solicited proposals from parties interested in redeveloping the subject sites. Goals included increasing the inventory of safe, affordable housing to serve low and moderate income households; increasing the inventory of permanent supportive housing; fostering community development that will enhance the surrounding neighborhoods; and recouping the City’s investment in purchase of the properties from FNMA.
The City received four written proposals from the following groups in alphabetical order:
Blue Sky Communities
Future Leaders Community Development Corp./Votum Construction/Cely Consulting
Orlando Neighborhood Improvement Corp./Jonesboro Investments Corp.
Vestcor/TVC Development
The four proposals were reviewed by an advisory committee of City staff that included Laurie Botts, Brooke Bonnett, Kevin Edmonds, Oren Henry, and Michelle McCrimmon. Presentations were heard by the advisory committee and questions were asked of each group. The formal presentations were followed up with the proposers being asked to complete a standard matrix in order for the advisory committee to more easily compare the 4% and 9% LIHTC (low-income housing tax credits) and other project funding sources being proposed by each group.
All four proposers presented 9% LIHTC as a potential funding source. Based on the LIHTC process for 9% tax credits, it was determined by the advisory committee that it is not feasible to move a 9% LIHTC application forward at this time for the subject sites.
As requested by the Committee, Blue Sky Communities and Vestcor/TVC Development included in their original proposal a 4% LIHTC/SAIL as a potential funding source. Future Leaders Community Development Corp. later submitted a 4% LIHTC option. After significant review of the proposals that were received that included a 4% LIHTC funding option, the advisory committee determined that the Blue Sky Communities proposal aligned most closely with the City’s goals and should be moved forward for consideration.
Specifically, the Blue Sky Communities proposal includes the following that the advisory committee judged to be important:
1) More proposed number of units- 116
2) A higher total development cost- $23,816,328
3) A higher land payment to the City- $1,500,000
4) Overall experience throughout Florida
5) Focus on Permanent Supportive Housing
6) Timely schedule of development goals.
The advisory committee recommended unanimously to Chris McCullion, Chief Financial Officer, that the City move forward with entering into a Purchase and Sale Agreement for the Peppertree Circle and Peppertree Shores land parcels to enable Blue Sky Communities to make application to the Florida Housing Finance Corporation for 4% LIHTC/SAIL funds, in addition to pursing other funding sources. Closing on the sites will not occur until Blue Sky Communities is able to show proof of development funds. Should Blue Sky Communities not secure development funding; the advisory committee will reconvene in order to prepare another recommendation for consideration.
The attached Purchase and Sale Agreement (Agreement) is for acquisition and redevelopment of the land parcels. The proposed purchase price is $1,500,000. Blue Sky Communities will seek funding from the City to supplement the FHFC Funding in an amount not to exceed $2,000,000. If the City’s contribution includes Federal funds, the Development must comply with all applicable federal requirements including, if applicable, Davis-Bacon prevailing wage and Section 3 requirements.
The due diligence period lasts until July 1, 2019. After the effective date of the contract, Blue Sky Communities will be responsible for insurance for the land parcels. After April 1, 2019 and through the closing date, Blue Sky Communities will be responsible for landscape maintenance and maintaining any fences for the land parcels. The anticipated closing date is the earlier of on or before December 31, 2019 or six months after final non-appealable approval of FHFC Funding, but in no event will the closing date be later than March 31, 2020, unless extended by the parties.
The Agreement provides that Blue Sky Communities will make good faith efforts to meet the City’s diversity goals, to help foster the growth of M/WBE City-certified businesses and to maximize participation by the community in the development. It further requires that Blue Sky Communities create and develop a Community Action Plan.
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