Item Q12
BOARD OF COUNTY COMMISSIONERS
AGENDA ITEM SUMMARY
Meeting Date: December 21. 2005
Division:
County Administration
Bulk Item: Yes ~ No
Department: County Administration
Staff Contact Person: Tom Willi
AGENDA ITEM WORDING:
Discussion of request to waive any rights of the County with respect to the sale of property located in
Marathon, Florida, Parcel No. 00337330-000000.
ITEM BACKGROUND:
Boat Works Investments, LLC has entered into a contract to buy the above referenced property. The
mortgage contains a provision stating that "Rental housing offered for sale prior to the end of (at least
15 years or the term of assistance, whichever is longer) must be subject to a right of first refusal for
purchase at the current market value by eligible non-profit organizations..." The mortgage was placed
on the property as a result of a State housing Initiatives Partnership (SHIP) loan. The Monroe County
Housing Authority administers the SHIP program for Monroe County; these funds come from the State
of Florida to Monroe County.
PREVIOUS RELEVANT BOCC ACTION:
N/A
CONTRACT/AGREEMENT CHANGES:
N/A
STAFF RECOMMENDATIONS:
Postpone consideration to the January 18, 2006 BOCC meeting due to the late request and there are
obvious legal and practical issues for which there is insufficient time to research.
TOT AL COST:
-0-
BUDGETED: Yes
No
COST TO COUNTY:
-0-
SOURCE OF FUNDS:
REVENUE PRODUCING: Yes
No
AMOUNTPERMONTH_ Year
APPROVED BY: County Atty _ OMB/Purchasing _ Risk Management _
DOCUMENTATION:
Included
x
fl/ionu;w Willi
Thomas J. Willi
Not Required_
AGENDA ITEM # Q 1;+
DIVISION DIRECTOR APPROVAL:
DISPOSITION:
FROM
FRX NO. :3052960932
Dec. 12 2005 02:50PM P2
~..
MONROE COUNTY HOUSING.AUfHORITY
1400 KENNEDY DRIVE- KEY WEST,FLORIDA 33040 · 305 296-5621
Board of COI\uni!lsiol\en
Harry Bethtll
Aaron Cilfitillo
Marg,ul!t GiI
fohn Dol"n-l':It-tthnger
Ailton LLll>ez
J. Mmuc CaStillo, Sr.
r:x.e~\ltiYl: D....:Olor
SENT VIA FACSIMILE
404-222-4654
December 09, 2005
Cory Thomp~on
Kutak Rock LLP
Suite 2100- Peachtree Center South Towet1
225 Peachtree Street, N.E.
Atlanta, GA 30303-1731
Dear Mr. Thompson:
I am in receipt of your letter dated December 6, 2005 regarding the Gulf Shores Apartments in
Marathon,lqoridll.
The mortgage in question wa... placed on the properly as a result of a State Housing lnitiatives
Pat1.llership (SHIP) loan. These funds come Irom the State of Florida to Monroe County. The Monroe
County HOllsingAuthority administers the SHIP program for Monroe County, a1\(i therefore I have
forwarded your letter to Tom Willi, County Administrator for review and Ilction as may be needed with
respect to the right of first refusal question.
1 have asked staff to prepl:lTC answers to . your request for additional information and wi Ii forward to- you
under separate cover.
Please feel free to contact me if any questions remain. Im;.lY be reached at 305-296-5621.
JMC:cac
pc: Tom Willi, County Administrator
Mark Rosch, Executive Director
Monroe County Land Authority
FAX NO. : 3052%0932
Dec. 12 2005 02:50PM P3
FROM
www.kut:.kroCk.com
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8UITE 2100
PEACHTREE C~NI~" SOUTH TOWER
2211 PIi"GttT"EE STREET, N.E.
AT~"NTA, OEORGI... 30:tO~.-1T:n
40..-222-4.00
FAC8IMlt.E 404-Z22-"054
December 6, 2005
BY FAX AND FEDERAL EXPRESS
Mal1lu::l Castillo, Oil'ec\or
MONROE COUNTY HOUSiNG AUTHORITY
Speciall'rograms Office
1403 12TH Street
Key West, FL ~3040
Re: G\df Shores Apartment~
Reference Mortgage Instrument recorded March 21, 1997 at Book 144& Page 9S()
RF. Pi\rcel 1.0. No. 00337330-000000, alk/a 999 41 st Street Gulf, Marathon,
Florida, to wit:
Lob 9 And 10, Rlock 5, RESUBDIVISION PT BLK 1 & ALL OF RLK 5',
MARATHON BEACH SUUDlVJSlON, . Mubdlvlsion of n GOV LT 3 SEe 10
l'W" 66 R31'F., accordillC to the Pl.t thereof as recorded In Plat Book 2, "age 11, of
the Pllblk R.ecords of Monrltc Counly. 'lorida. !lnd PT FILLED DAY l\OT'l'OM
North of nd co.tieuou, to Lot 10 (a~n ducribed by metu and bOunds at book
1657 ralell 54-56 01 Slid r.blic Recl)rdli).
Dear Mr. Cast\llo:
As you know, our chents have entered into a contract \0 sell the above-referenced
pn)pert)' to Boat Works Investments LtC on terms and conditions including, but nut
limited to, the foJ1owing:
Purchase Price:
Deposit:
C}o~ing Date:
$3,200,000.00 (all cllsh)
$ 160,000.00
On or before Decmnbcr 30, 2005
The morlgl\ge contains a provision !\tating that "Rentu} housing otl'crcd for sare
prior to the end of [at lellst 15 years or the term of assistance, whichever is !ongerl must
be subject to a )'ight of first refusal for purchase at the current market value by eligihlc
non-profit orguni7,ulions...." No further explanation of this provision is set furth in the
mortgllge.
4820.6987...12~"7.
Page 1
HlX NO. : 3052%0932
Dec. 12 2005 02:50PM P4
FROM
KUTAK. ROCK LLP
On behalf of our client, we request that Monroe County, acting by and through the,
Monroe County 1l0usingAuthorit.y (th~ "Authority"), waive in writing any rights it may
have with respect to the subject properly Ulmer the languclgc quoted above.
I f the Authority has an interest in pursuing its right, if any, to purchase' the subject
property under the same tenns as those set forth in the contTllct with Boat WorkS'
Investmt~nts LLC (including without limitation, for $3,200.000 c~\sh and a closing on or
before Det:ember30. 2005), or if Authority intends to othclWise seek enforcement of an)!
rights umleT the langullge quoted above, we request you notify us as soon as possible.
Please schedule the consideration of this matter by the Authority at it~ next regularly
schedult.-d meeting in December 2005.
In addition to the foregoing, plcase provide me the I(,lfowing information In
connection with the mortgage on the slIojecl property:
) . Thc payoff umOllnt as of December 30. 2005.
"J.. Please eonfinn that upon receipt of the payoff amount., the County of
Monroe will in writing acknowledge the sale, release the mOl'tgl\gc and release all
obligations of tllt: mortgagor under the mortgag.e and other loan documents related or
incident ther~to.
}. We also needtn know if the mortgage in qUtl !>t ion Of the source of llle
loaned funds f()T which it secufCS repayment was in any wuy encumbered by state, federal
or other regulations or requirements that would impair or call into the 'lllestinn the
validity of any attempt~d conveyance by our clients. If so, please identify such
regulations or other requirements.
Thank you for your attention to this matter. If you have any question!; or ncred
additional information, please contl\ct me.
Very tn\ly yours,
~~~.
Cory Thllmpsun
cc: Sherry A. Spiers, E'iq. (via lacsimilc)
.Iohn O. Jones (via facsimile)
Drew MarlElr, Esq.
4g'2n.(;~R2.425t\2
Page 2
Gulf Shore Apartments
41st Street in Marathon
Summary of Issues
. Property consists of 19 units totaling 13,733 sq ft on 0.75 acre zoned MU
. Property is over density based on County code (0.75 acre x 80% x 18 du/buildable acre = 10
units); status under Marathon code has not been determined
. Units consist of 2 1-BR/1-Bath; 12 2-BR/1-Bath; and 5 3-BR/1-Bath; average unit size is 723
sq ft
. Property is in need of repairs and experienced storm surge from Hurricane Wilma; the
structures will likely need to be leveled and rebuilt to meet housing standards applicable to
the ownership and management by Housing Authority
. At least half of the units are currently occupied
. Boat Works Investments LLC has a contract to purchase the site for $3.2 M ($168k1unit) with
a December 30, 2005 closing date
. Property is subject to $60,000 County SHIP mortgage and is in year 9 of the 15-year term
. SHIP mortgage reserves a "right of first refusal for purchase at current market value by
eligible nonprofit organizations who would provide continued occupancy by eligible
persons. "
. Monroe County Land Authority Advisory Committee supports participating in the acquisition
if the project is feasible and the necessary partner is available to own, redevelop, and
manage the site
. Boat Works purchase price of $3.2 M is approximately 75% of the Land Authority's available
funding for FY 2006
. Which parties qualify as "eligible nonprofit organizations who would provide continued
occupancy by eligible persons" and therefore have a right of first refusal to purchase?
. For how long does the right of first refusal exist?
. What is the corresponding purchase price for exercising the right of first refusal-the
pending contract price of $3.2 M or the current appraised value?
{l.tI-