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CITY OF HOUSTON - CITY COUNCIL
Meeting Date: 11/13/2019
District H
Item Creation Date: 6/4/2019
HCD19-65 East End Innovation Maker Hub
Agenda Item#: 16.
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| | | | | | | | Summary:
ORDINANCE approving and authorizing the City to borrow from the UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT ("HUD") $22,700,000.00 of loan funds provided under Section 108 Funds; authorizing the issuance of Non-Recourse City of Houston Notes in the amount of the Section 108 Funds, contract for loan guaranty assistance and related documents between the City and HUD and an agreement between the City and EAST END MAKER HUB SPONSOR LLC to provide a loan of the Section 108 Funds and a performance-based grant of Federal Community Development Block Grant funds to finance a portion of the costs to acquire and renovate a project to be known as East End Maker HUB to be located near 6501 Navigation Boulevard, Houston, Texas; ratifying the City's application to HUD to borrow the Section 108 Funds - DISTRICT H - CISNEROS
This item should only be considered after passage of Item 15 above |
| | | | | | | | Background:
The Housing and Community Development Department (HCDD) recommends Council approval of a contract for loan guarantee assistance and related documents between the City, HUD and an agreement with East End Maker Hub Sponsor, L.L.C., providing a Section 108 loan of up to $22,700,000.00 and $1,390,000.00 in Community Development Block Grant entitlement funds (CDBG).
Funding will provide eligible Section 108 and CDBG costs relating to the acquisition and rehabilitation of a 307,000 square foot (SF) warehouse, known as East End Innovation Maker Hub (Maker Hub), located at 6501 Navigation Blvd. to facilitate economic development by providing below market rental space for light industrial businesses. The Maker Hub in conjunction with TXRX will provide 250,000 SF of shared collaborative space to incubate new start-up businesses and offers the use of equipment to all lessees while providing job training and education. TXRX has partnered with UPCDC to provide apprenticeship programs for East End residents to equip low-income individuals with the skills to access higher paid employment.
This will be a joint endeavor between UPCDC and TXRX to establish a non-profit located at 6501 Navigation Blvd. in the Second Ward.
In 2008, TXRX was established as a non-profit manufacturing incubation and makerspace comprised of makers, inventors, tinkerers, artists, crafters and coders. UPCDC is a nonprofit organization established in 2017 as a joint collaborative effort by TXRX and the Greater East End Management District to catalyze commerce and economic development in Houston’s East End.
The CDBG funding for the agreement being considered pursuant to this ordinance is being provided pursuant to a substantial amendment whose ordinance is also being considered today. This ordinance should not be considered until the ordinance regarding the substantial amendment has passed.
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Sources
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Amount
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Uses
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Amount
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Section 108 Loan
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$22,700,000
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Acquisition
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$12,350,000
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CDBG Grant
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$1,390,000
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Hard Cost
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$11,907,809
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| Net NMTC |
$7,424,650 |
Soft Cost |
$3,015,210 |
| Other Contributions |
$152,108 |
NMTC Fees and Closing |
$2,133,703 |
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Financing Costs |
$1,325,384 |
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Developer Fee |
$934,652 |
| Total |
$31,666,758 |
Total |
$31,666,758 |
UPCDC was selected from RFP Solicitation No.: T26095.
Fiscal Note:
No fiscal note is required on grant items.
This item was reviewed by the Housing and Community Affairs Committee on June 18, 2019.
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Tom McCasland, Director |
| | | | | | | | Amount and Source of Funding:
$22,700,000.00 - Federal Government Section 108 (5001)
$1,390,000.00 - Federal Government Grant Funded (5000) |
| | | | | | | | Contact Information:
Roxanne Lawson
(832) 394-6307
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