Authorizing Sale of Land to The Sound on 76th, LP and Approve Redevelopment Agreement

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CLOSED: This was approved at the HRA meeting on September 10, 2020.

CLOSED: This was approved at the HRA meeting on September 10, 2020.

  • Project Details & Updates

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    21 Aug 2020

    With financing and land use approvals secured, Aeon is seeking to acquire the property at 4100 W. 76th Street from the HRA. Resolution 2020-04 authorizes the sale of the Property to The Sound on 76th, Limited Partnership.

    Low Income Housing Tax Credit developments are structured whereby a Limited Partnership is formed that will own the development. The Tax Credit investor, in this case US Bank, becomes the Limited Partner and Aeon is a member of the General Partner, 4100 Edina, LLC. The sale of the land will be to the Limited Partnership.

    On November 29, 2018 the Edina Housing and Redevelopment Authority authorized Staff to work with outside counsel to prepare legal documents for the acquisition and future conveyance of 4100 West 76th Street (the “Parcel”). The HRA acquired the Parcel on August 29, 2019 and entered into a Purchase Agreement with 4100 Edina, LLC, (“General Partner”) of which Aeon is the sole Member.

    Aeon is proposing a 100% workforce housing development containing 70 units with a combination of 1-, 2- and 3-bedrooms to serve households with incomes ranging from less than 30% of Area Median Income (AMI) to at or below 60% of AMI. Parking for residents and guests would be provided on site.

    The HRA acquired the Parcel for $2,900,000 and agreed to sell it to the General Partner. At the time, the proposed course of action was to keep $2,400,000 in the Parcel as the HRA’s contribution to the development and sell the Parcel for $500,000. However, due to Minnesota Housing’s funding application pointing system and the financial award from the Metropolitan Council requiring that a portion of their funds be uses partial financing of acquisition, it is better if the HRA conveys the Parcel for the full $2,900,000 and separately enters into a Redevelopment Agreement for $2,400,000 plus the previously approved $798,000 TIF award.

    Aeon was awarded full funding in April and is working towards an early autumn financial closing. Construction will start soon thereafter.