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File #: 2017-0140   
Type: Project Status: Passed
File created: 3/1/2017 In control: Planning and Programming Committee
On agenda: 4/19/2017 Final action: 4/27/2017
Title: AUTHORIZE the Chief Executive Officer to amend Metro's Second Revised Amended and Restated Joint Development Agreement ("JDA") with MacArthur Park Metro, LLC, ("MPM") to: (a) extend the term of the JDA to December 31, 2017, and (b) allow Metro to terminate the JDA if Metro reasonably determines that the Ground Lease will not be executed prior to December 31, 2017 or that the mixed-use joint development project contemplated in the JDA (the "Phase B Project") is not feasible.
Sponsors: Planning and Programming Committee
Indexes: Construction, Grant Aid, Project, Safety
Meeting_Body
REGULAR BOARD MEETING
MAY 25, 2017

Subject/Action
SUBJECT: WESTLAKE/MACARTHUR PARK STATION JOINT DEVELOPMENT

ACTION: AUTHORIZE EXTENDING THE TERM OF AN EXISTING JOINT DEVELOPMENT AGREEMENT

Heading
RECOMMENDATION

Title
AUTHORIZE the Chief Executive Officer to amend Metro's Second Revised Amended and Restated Joint Development Agreement ("JDA") with MacArthur Park Metro, LLC, ("MPM") to: (a) extend the term of the JDA to December 31, 2017, and (b) allow Metro to terminate the JDA if Metro reasonably determines that the Ground Lease will not be executed prior to December 31, 2017 or that the mixed-use joint development project contemplated in the JDA (the "Phase B Project") is not feasible.

Issue
ISSUE

Metro and MPM are now parties to the JDA, which is scheduled to expire on April 30, 2017. Metro and MPM would like to extend the term of the JDA to December 31, 2017 to provide additional time to address current financing and construction cost challenges for the Phase B Project, while providing Metro with the flexibility to terminate the JDA as noted in the recommendation.

Discussion
DISCUSSION

Metro and MPM executed the JDA on June 27, 2016. The JDA contemplates execution of a long-term ground lease ("Ground Lease") that will provide for MPM's construction and operation of the Phase B Project, but only after certain contingencies are met. One of these contingencies requires MPM to secure all construction and permanent financing for the project to the reasonable satisfaction of Metro. Such financing seemed to be in place in September 2016 when MPM secured a Low-Income Housing Tax Credit ("LIHTC") allocation for the Phase B Project from the California Tax Credit Allocation Committee ("TCAC"). At the time, this allocation was estimated to be worth $26 million in equity financing and represented the project's final funding piece.

Since then, the value of the tax credits has gone down approximately $3 million (12% decrease) an...

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