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South Bend Redevelopment Commission <br />Regular Meeting —April 12, 2011 <br />reason, KKC has requested extensions of <br />both leases. For the Stephenson Mill lease, <br />KKC proposes to extend the term of the lease <br />for 35 years. For the Central High lease, <br />which has the $299,000 purchase option at <br />the end, KKC proposes to make a balloon <br />payment of $100,000 when it secures its <br />financing which would be against the <br />purchase option now, with level amortization <br />payments over the life of the lease extension. <br />Subsequently, KKC came to the city and <br />requested a term be placed in the agreements <br />and the extensions to provide for <br />assignability of these leases, subject only to <br />the new tenant to be able to assume the loan <br />obligations that KKC is working on. <br />The current leases provide that the <br />Commission will not reasonably withhold its <br />consent to a request for assignment. The <br />requested additional assignability language <br />makes it easier for them to assign the leases, <br />but reduces the Commission's control over <br />the use of those properties. If we get a <br />proposed use that's not conducive to what we <br />believe the general development of that area <br />should be, then we can withhold consent to <br />the assignability of that particular lease. If <br />they can assume the loan obligation then the <br />assignment is automatic. At this juncture <br />we're requesting that the Commission <br />approve the lease extensions without the <br />assignability clause. <br />Ms. King asked if the assignability clause <br />was required. Mr. Meteiver responded that it <br />is not a deal- breaker. <br />Ms. King asked if there were restrictions as <br />Central High Apartments is required to have <br />a certain percentage of low income tenants. <br />8 <br />