Tacoma Community Redevelopment Authority. Request for Proposals: Construction and Permanent Debt. Valhalla Hall

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1 Request for Proposals: Construction and Permanent Debt Valhalla Hall The (TCRA) is requesting debt (construction and permanent) proposals for its redevelopment of Valhalla Hall, a mixed-use project located at 1216 Martin Luther King Jr Way in the Hilltop neighborhood of Tacoma. The project will be financed with Community Development Block Grant (CDBG) and Urban Development Action Grant (UDAG) funds. RFP Timeline Issue RFP for Equity/Debt : April 5, 2016 Debt proposals received: April 26, 2016 Select Lender: April 25, 2016 Anticipated Closing Date: May 6, 2016 Please responses by April 26, 2016 to: Jovan Ludovice Development Consultant jludovice@bellwetherhousing.org Tel:

2 Valhalla Hall Financing RFP Page 2 Existing Building and Site Conditions The 6,500 SF (0.15 acre) site is located in the Hilltop Neighborhood, at 1216 Martin Luther King Jr Way, Tacoma, WA (parcel # ). The parcel is zoned NCX (Neighborhood Commercial Mixed-use). Lot dimensions are approximately 50 x 130. No on-site building parking is proposed. The building s main entrance is on Martin Luther King Jr Way. The site is owned by TCRA. The site is improved with a three story building, formerly serving as a social hall for the Swedish Order of Valhalla. The building is currently vacant. The site is well-served with urban infrastructure, though upgrades to the existing utilities to accommodate the change and increase in usage will certainly be necessary. Design and Construction Scope of work includes demolition of a portion of the approximately 15,500 sq. ft. existing structure, originally built in 1906, to create a courtyard and allow fire access to the proposed dwelling units. Rehabilitation of the remaining structure and new construction, necessitated by the partial demolition, will result in 1 one-bedroom and 1 studio apartment plus two work-live spaces with attractive storefronts fronting Martin Luther King Jr. Way on the ground floor. On both the second and third floor there will be 12 studios and 1 one-bedroom apartments. The fourth floor will have 9 one-bedroom loft apartments. The total unit count will be 26 units. The intent for the front façade on Martin Luther King Jr Way is to have it retain its heritage appearance while upgraded and beautified. Building Summary Valhalla Hall Lot Area: 6,500sf Projected Total Building Area: 17,772 sf 26 units (54% affordable at 80% AMI or below and 9 units at 50% AMI or below): o 13 studio units o 2 one-bedroom units o 9 one-bedroom loft units o 2 work-live units on ground floor (satisfying commercial requirement). Neighborhood Valhalla Hall is located in the historic Hilltop neighborhood in Tacoma, WA. The Hilltop is located immediately adjacent to Tacoma s downtown core, which is home to the City s largest concentration of jobs, as well as most of its major cultural and educational institutions. Downtown Tacoma has undergone significant revitalization over the past few decades, and Hilltop is well-poised to capitalize on that new energy. Hilltop s local assets include two of the City s largest healthcare facilities, an established business district and residential neighborhood, strategic proximity to local and regional assets and destinations, a unique and dynamic history, and a future Sound Transit LINK light rail investment through the core of the community. Together, these endowments create an extraordinary opportunity for positive transformation in Hilltop.

3 Valhalla Hall Financing RFP Page 3 Transit-Oriented Development In 2013, the Sound Transit Board approved the North Downtown Central Corridor for the expansion of the Tacoma Link light rail system. The existing 1.6 mile Tacoma Link light rail line currently serves 6 stations from the Theater District to the Tacoma Dome Stations. The expansion will include a 2.4 mile extension from the Theater District to the Stadium and Hilltop neighborhoods. The Sound Transit Board recently selected stations for the expansion, one of which will be along Martin Luther King Jr. Way and South 11 th Street, 1 block from Valhalla Hall. Construction of the expansion is slated to begin in Financing The total estimated cost of the Valhalla Hall project is $6,988,951 based on contractor pricing from February TCRA is proposing to finance the development of Valhalla Hall through the following sources: Tacoma Urban Development Action Grant $3,000,000 Community Development Block Grant $1,992,852 Permanent Debt $1,996,099 At initial lease up, 54% (14) of the units will be designated to households earning 80% Area Median Income (AMI) or below. Of the 14 restricted units, 9 (1/3) units will be at 50% AMI or below and 5 units will be at 80% AMI or below. After the initial lease up, the 5 80% AMI units will convert to unrestricted market rate units. Project Timeline: Design/Const. Milestone Date Financing Milestone Date Building Permit Submittal April 2016 Financing RFP April 2016 Construction Bid June 2016 Select Lenders May 2016 Final Construction Contract July 2016 Closing July/August 2016 Building Permit Issuance July 2016 Permanent Conversion October 2017 Construction Start August 2016 Construction Completion July 2017 Project Team Owner Development Consultant & Construction Manager Property Manager General Contractor Architect Bellwether Housing Coast Management RAFN Company SMR Architects

4 Valhalla Hall Financing RFP Page 4 Response Requirements and Submission Please include the following information in your proposal as applicable: DEBT PROVIDER: The current budget assumes a $1,996,099 permanent tax-exempt loan. With current construction pricing higher than currently budgeted, we cannot accept a permanent loan at less than $1,996,099. We anticipate a construction period of 11 months, with a construction loan term of 14 months. Permanent loan Interest rate Amortization period Loan term Prepayment penalty/yield maintenance requirements Other key loan terms Construction loan Draw-down loan or fully funded at closing Construction period interest rate Required interest reserve Response Requirements Summary of why your lending/investment program is a good fit for TCRA and the proposed project Financing costs payable by Sponsor (legal, due diligence fees, fees, deposits, third-party review fees, etc.) Reserve requirements Stabilization or conversion requirements Special conditions for operating performance, if any Debt service coverage requirements Summary of required guarantees Conditions of default Any unique tenant income certification or compliance reporting requirements and whether a third party verification is required at initial lease-up Annual reporting requirements and schedule Annual fees Insurance requirements for owner and contractor Banking account expectations Pledge of financial support for celebratory events such as a groundbreaking, roof raising or opening 2-3 reference projects and contacts in Washington state, ideally for similar projects. Proposal expiration date

5 Valhalla Hall Financing RFP Page 5 The following files have been attached in addition to the information below: Financial Projections Market Study Floor plans and elevations TCRA Organization Chart Tacoma Community & Economic Development Annual Report TCRA 2014 Audited Financial Statements About The was created as a public corporation organized pursuant to the ordinances of the City of Tacoma, as existing or as hereafter amended, and pursuant to the Revised Code of Washington. The purpose of the Authority is to provide an independent means of carrying out and administering federal grants or programs pursuant to the provisions of the Housing and Community Development Act of The Authority is intended to provide increased flexibility and efficiency in administering federal grants and programs, such as the Community Development Block Grant and the HOME Investment Partnerships Grant, and the projects and activities financed from funds derived from such federal programs. For more information regarding the Valhalla Hall project, please contact: Jovan Ludovice Development Consultant Bellwether Housing jludovice@bellwetherhousing.org Carey Jenkins Housing Manager cjenkins@ci.tacoma.wa.us Shannon Johnson Contract Manager csjohnson3@ci.tacoma.wa.us