FAQs: Frequently Asked Questions

Why would the City agree to transfer South Phase land earlier than previously required?

The developer believes that it has the opportunity to finance the Club Phase and the South Phase of the project together as a package, but it would require a mortgage on the city-owned South Phase land when that loan for both phases closed.

The City may decide that it wants the developer to line up the financing for both of these phases together as soon as possible, as opposed to financing the Club first and hoping that the developer can later find the financing for the South Phase. However, if the City does agree to transfer this land earlier for this joint, two-phase financing, it still has a reversionary interest (a right to take the property back) if the developer fails to complete the South Phase on time.

The proposed 9th Amendment to the Redevelopment Agreement identifies 13 separate conditions which must occur before the South Phase land can be transferred to the developer – including permits, site plan approvals, guaranteed maximum price contracts and private financing for both the Club Phase and South Phase. 

These conditions are designed to ensure that both the Club Phase and the South Phase are "shovel-ready" and fully financed to further ensure completion of construction of both Phases.  The developer has also agreed that the lender's mortgage interest is subordinate (inferior to and behind) the City's reversionary rights in this property unless and until the start of construction on the South Phase.  So if nothing ever happens on the South Phase, the lender will not have funded part of the loan on the South Phase and the City can reclaim the property.  If the South Phase is started but never completes, the City still has a reversionary right, but it will be behind the lender and will have to coordinate and collaborate with the lender to get the South Phase finished.