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Another do-or-die moment for Quay
The city wouldnt be getting its moneys worth, a councilmans study concludes.
Much has changed since early December, when the City Council gave its first, conditional approval of funding for preservation of the Quay Bainbridge Apartments.
Faces at City Hall have changed, with new councilors and a new city administrator. Finances have changed as well, with $1.9 million in storm damage to city roads and the added strain of departmental cuts.
Meanwhile, the 71-unit Quay home to a diverse group of residents who without the complex might otherwise be priced off the island still sprawls across several parcels near Waterfront Park.
And its owners still await a buyer, be they affordable housing advocates or developers eager to convert the property to market rate housing.
Whatever the resolution, the wait may soon be over.
The sellers cant wait forever, said Sue Yuzer, of the Lutheran Alliance to Create Housing, the housing agency with which the city and the Housing Resources Board has partnered to strike the deal.
Councilors tonight will vote on a several items that could decide the deals ultimate fate, since time continues to be a factor. The meeting begins at 7 p.m. at City Hall, though the Quay vote is slated toward the end of the agenda.
The council in December agreed in principal to put $3.95 million over the next two years toward the purchase of the Quay, to preserve it as affordable housing.
The ownership group last year received an offer of $12.6 million for the property, but has waited to see if the partnership between the city and housing agencies which also is supported by $1 million in private donations could match.
Dealmakers have spent the past two months ironing out various details of the agreement, which still would hinge on due diligence including an independent appraisal and capital needs and environmental assessments, among other things.
All the major components of the deal were resolved by mid-January, Yuzer said, but some of the mechanics have yet to fall into place.
A 90-day due diligence period would begin after the signing of a purchase and sale agreement, which with council support tonight could come as early as Friday, but more likely later in the month.
A key issue is the structure of the citys portion of the financing. Rather than a loan to LATCH which as eventual owners of the property would in any case be required to maintain the Quay long-term as affordable housing the money may be allocated as a grant with a regulatory agreement that would protect the citys interests.
Both Yuzer and city planner Brent Butler said the package before councilors tonight which includes a resolution to allocate funds, and a list of conditions would if approved allow the next phase of the effort to begin; its defeat could kill the project.
I think its do or die this week, Butler said.
Though the agenda items on the surface appear similar to already-decided matters, they actually contain much greater depth than what the council previously voted on, Butler said.
As part of the decision, the council must decide whether to approve $25,000 for non-refundable earnest money, which would be matched collectively by the other participants.
Councilman Kjell Stoknes was the lone dissenter in the original Quay vote. After subsequent research copies of which have been given to councilors and will be available at tonights meeting Stoknes said he maintains his position.
He said too many big financial decisions, the Meigs Farm purchase being one example, are being made on the fly.
I still sense this is an emotional buy, he said of the Quay. Im not seeing programmed spending, Im seeing reactionary spending.
Stoknes believes the city could do more for affordable housing perhaps as many as 163 units over the next 20 years by spending the same amount of money on more modestly priced units on less expensive land.
According to his analysis, purchasing the Quay under current terms accounting for required renovation and the conversion of 14 units to market rate to help fund the project would equate to roughly $309,000 per remaining unit.
Stoknes said a renovated Quay appears costly when compared to apartment sale data on the island, which tends to be sparse.
A newer property just south of the Island Village shopping center with 67 units for sale has a per unit cost of about $224,000, with no needed renovation.
Im just trying to take a hard look at the facts, Stoknes said. I dont know that weve been given the big picture that would help us understand what wed have to give up in the future to do this.
Still, supporters of the Quay have continually cited the complex as the last remaining bastion of affordable housing in downtown Winslow. They say the loss of the complex would be a big blow to the islands effort to make more housing available to those with lower incomes.
Yuzer said its important to remember that no deal would move ahead without satisfactory results from the due diligence work.
If an appraisal comes back that doesnt support the purchase price then wed go back to the sellers, she said.
Yuzer lauded the sellers for being patient thus far, but said that with a tight timeline, and another offer on the table, their willingness to negotiate could be waning.
Despite some glitches along the way, most councilors have remained supportive of the effort.
Dealmakers, among them Housing Resources Board Director Carl Florea, hope that support continues tonight.
Lots of effort has gone into this, he said. Were just trying to squeeze together enough support to get this done.