On 12/05/07 City Council approved a Loan Agreement
between the City of Houston and Corinthian Pointe Senior Living Corporation, a
501(c) 3, non-profit corporation (Borrower) to provide a Performance Based Loan
in the amount of $3,375,670. The loan
was funded under the HOME Program to provide a portion of the funds to assist
in the development of Corinthian Village Apartments, a 124-unit apartment
community for low and very low income seniors, located at 6105 W. Orem Drive,
approximately two miles south of Loop 610 in southwest Houston (Community). The construction of the Community is now
complete and the current senior loan matures in February, 2015.
The Housing and Community Development Department (HCDD)
requests that Council approve an amendment to
the Loan Agreement (First Amendment to Loan Agreement) which will (i) increase the
maximum amount of the senior loan from $6,474,500 to $7,760,000, and (ii)
authorize a new loan (New Loan) from CBRE HMF, Inc. and a Subordination
Agreement among the City of Houston, CBRE HMF, Inc., and Borrower. The New Loan, which will be insured under
HUD’s Section 223(f) program, will refinance loans from Trustmark Bank, the
current senior lender, and The United Methodist Foundation of the Texas Annual
Conference, the current junior lender, and will pay the outstanding ad valorem
taxes, which are currently due and payable, and those which are the subject of
a payment plan established in the settlement of tax protests filed against the
2010 and 2011 tax valuation. The new loan is a 35-year loan with a fixed 3.57%
plus a 0.60% Mortgage Insurance Premium (for the HUD insurance) for an effective
4.17% interest rate. No proceeds will go to the Borrower or its
owners.
The Department recommends approval of the First
Amendment to the Loan Agreement and the New Subordination Agreement to
refinance the Senior Lien debt on the Corinthian Village Apartments.