1

The Bottom Revitalization Project - 2006 Bond

A Briefing to the Housing Committee

Housing DepartmentJune 2, 2008

2

KEY FOCUS AREA: ECONOMIC VIBRANCY

PURPOSE:

Recommendation to fund $500,000 in Proposition 8 funds to assist in the development of a portion of the residential component for the Economic Development Project in the “Bottom”, as detailed in the Master Plan for the area.

3

2006 General Obligation Bonds

November 2006 – a $41.5M in General Obligation Bonds was approved by voters to fund:

Southern SectorPublic Infrastructure for City right-of-ways or dedicated easements, and may be used for planning, designing, constructing, improving, extending and expanding public streets, and utilitiesEconomic development projects in connection with commercial, retail, residential, and mixed-use development

4

2006 General Obligation Bonds (cont’d)

Other areas of the CityTransit Oriented Developments for economic development projects in connection with commercial, retail, residential, and mixed-use development

Uses include development through:Acquisition of land including improved and unimproved properties, the demolition of existing structures, making loans and grants, and otherwise providing assistance for private commercial, industrial, retail, residential and mixed-use developments

5

“The Bottom”Community-Wide Master Plan

This Plan outlines a comprehensive vision for the area, developed in cooperation with residents, local churches, and private/public sector entities

Revitalization of the Bottom by creating a desirable community and reestablishing this neighborhood through partnerships

Texas Heavenly Homes, Ltd. (THH)Bottom Community LeadershipGolden Gate Missionary Baptist ChurchShiloh Missionary Baptist ChurchGolden S.E.E.D.S. Foundation City of Dallas

6

“The Bottom”Community-Wide Master Plan (cont’d)

Located in City Council District 7The west half of the Bottom has benefited from sizable investments from

Golden Gate Missionary Baptist Church (GGMBC)Shiloh Missionary Baptist Church

Both maintain a strong presenceThe City of Dallas has included the “Tenth Street Bottoms” area in the Trinity River’s Economic Land Use Plan and incorporated proposed land uses as part of the “forwardDallas” plan

7

“The Bottom”Community-Wide Master Plan (cont’d)

Bound by I-35 to the west, the Trinity River to the north, Corinth St. to the east and 8th St. to the southOf approximately 92 acres with 142 predominately small single-family homesOf 307 vacant lots, roughly 68% of the lots directly adjacent to the Trinity River Levee are vacant and on dead-end streets

8

9

The BottomCommunity-Wide Master Plan LegendArea 1: Commercial/Low Rise consist of primarily ground floor retail or office with surface parkingArea 2: Single-family residential with yards on the side, front and rear, driveways with detached or attached garageArea 3: Commercial/Mid-Rise consist of mainly ground floor retail with additional uses aboveArea 4: Yvonne A. Ewell Townveiw CenterArea 5: Green space and Parks- Eloise Lundy ParkArea 6: Multi-family Residential/Mid-DensityArea 7: Harllee Elementary SchoolArea 8: Dallas Housing Authority Brackins Village

10

Area 1:Commercial/Low Rise

Land development will consist of primarily ground floor retail or office with surface parking

Ideal for small shop retailers serving the needs of the communityDevelopment occurring along highly visible corridors with a high traffic volume

11

Area 1:Golden Gate Missionary Baptist Church

Civic/Institutional/ReligiousGGMBC, “The Flagship Church”, was established in the 1930’s in a small house across from the church’s present locationIn 1934, a frame building with an annex built on four acquired lotsGGMBC has expanded into the largest congregation in the Bottom

12

Area 1:Golden Gate Missionary Baptist Church (cont’d)

Church CampusGGMBC continue to acquire adjacent properties with church funds, assembling sufficient property to construct new

Dining hall and kitchenK-12 boy’s schoolChildren’s ministryOffice space and classroomsHousing for elderly, and Recovery Village – housing for men formerly engaged in substance abuse

GGMBC now owns 10 lots, with the goal of assembling a sufficient critical mass to fully realize it’s vision

13

Area 1:Golden Gate Missionary Baptist Church (Cont’d)

Church Campus DevelopmentOpportunity Area

14

Area 2:Single-familySingle-family consisting of:

Freestanding dwelling units with yardsDriveways and/or alleys with a detached or attached garageSeparate lots maintained by owner

15

Area 3:Commercial/Mid-Rise

Commercial/Mid-Rise consisting of

Mainly ground floor retail with additional use aboveAdditional retail and/or office useParking on adjacent surface lots and/or structured parking

16

Area 4:Yvonne A. Ewell Townview CenterTownview, DISD flagship incorporates six independent magnet schools

Gifted and talentedScience and engineeringGovernment, law and law enforcementBusiness and managementEducation and social servicesHealth professions

17

Area 5:Green space and Parks

Open space/park areas consist of:

Land set-aside for public use and enjoymentFew to no buildings and area maintained for public recreation or preservationSingle lot/block or span many acres

18

Area 5: Eloise Lundy Park Trinity Gateway Amphitheater (cont’d)

Future Bond sales could include pedestrian access directly from Bottom to River floodway and a public gathering space such as an outdoor amphitheater

19

Area 6: Multifamily Residential/Mid-Density

Multifamily residential/Mid-density consists of:

Freestanding buildings, one to multiple levelsDwelling units with bedroom(s), kitchen, living areasBoth indoor and outdoor common space, as well as parking and other amenities

May include small retail establishments

20

Area 6: 8th St Retail @ Hutchins (cont’d)

High traffic area ideal for development of small shop retail

21

Area 7: N.W. Harllee Elementary SchoolHarllee Elementary School is located directly across the street from Townview Center on 8th Street

Small campus with 270 students, PK-5th

and 26 faculty members

22

Area 8: Brackins Village Dallas Housing Authority

“The Village”, a 152-unit complex with numerous multi-family structures in good repairWas constructed in 1952 as an addition to the Frazier Courts complex on Hatcher StreetDHA is planning future demolition and replacement

23

Housing: Texas Heavenly Homes, LtdApplicant

Texas Heavenly Homes, Ltd., a subsidiary of Hanover Property Management Company, a Texas Land Development Co.

THH formed in 2004 for the explicit purpose of redeveloping the Bottom

Hanover PropertiesRichard LeBlanc, Executive Vice-PresidentHanover has over 30 years of land development experience in Dallas/Ft. Worth

Approximately 4,000 acres developed for residentialOver 6500 lots developed with home construction coordinated withbuilders

Developer of Master-Plan Communities for custom, middle-market, second-time homebuyer communities with high quality residential development

Lowes Farm and Mira Lagos, located adjacent to Joe Pool Lake, are approximately 1,000 acres of mixed-income communitiesHanover Retail/Commercial development often accompanies the residential

24

Texas Heavenly Homes, Ltd (Cont’d)

THH FoundersRichard LeBlanc, ChairmanGabriel Meadows, President, and Limited Partner

5950 Berkshire Lane, Ste. 1200Dallas, TX 75225

THH has made a commitment to building quality homes that are affordable

Single family housing will replace existing vacant lots and substandard housingTHH owns approximately 40 lots and has 15 under contractTHH has identified 25 Dallas Land Bank lots that they intend to acquire

25

Texas Heavenly Homes, Ltd (Cont’d)

THH funding request is for: Land acquisition – vacant, improved blighted and/or crime ridden residential properties

Predevelopment expenses (i.e. environmental assessment, appraisal, survey)

Demolition and RelocationBond funds not to exceed appraised value plus demolition

For the purpose of constructing residential Single-family homes will sell for $110,000 to $130,000 with floor plan starting at 1233 sq’ to 1900 sq’Residential development will include driveways and/or alleys with a detached or attached garage

26

Texas Heavenly Homes, Ltd (Cont’d)

Funding Sources:

Equity $* 205,0002006 Bond Funds $ 500,000Total $ 705,000

Uses: Acquired Lots $ 205,000Property Acquisition** $ 500,000Total $ 705,000

* 36 Lots already acquired by THH, Ltd**Demolition Relocation and Pre-development costs are

included

27

THH Model Homes

28

THH Model Homes (cont’d)

29

THH Model Homes (cont’d)

30

THH Model Homes (cont’d)

31

Texas Heavenly Homes, Ltd. Loan

The initial loan amount will be $500,000 in Bond funds Any additional Bond commitments will be evaluated after next Bond Sale in November 2008

32

THH, Ltd. Loan (Cont’d)

Loan Terms:Zero percent interest with maturity date of seven (7) yearsIf Borrower fails to expend all of the Loan proceed within two years of execution of the Note, or to redevelop the acquired properties with residential units within seven years of execution of the Note, then the portion of the project expenditures for projects that are incomplete will be due and payable

33

THH, Ltd. Loan (Cont’d)

Upon CO, Borrower will be released from indebtedness on the Note for corresponding Bond loan proceeds advanced and the Bond Deed Restrictions terminated on that propertyCity funding will not exceed appraised value for acquisitionNew deed restrictions to the homebuyers will be placed on the land and improvements if federal funds are usedAll other funding and required financing (Gap) to be provided by THH

34

THH, Ltd. Loan (Cont’d)

If Borrower fails to comply with the expenditure or construction requirements, the City of Dallas has the option to require Borrower to convey fee simple title to the properties acquired with Bond funds under the loan, to the City, free of any liens or encumbrances not acceptable to the CityIf Borrower obtains acquisition loans from another Lender for remainder of acquisition costs, the City will subordinate its lien position

35

Recommendation

That the Housing Committee approve the Bottom proposal for City Council consideration to:Texas Heavenly Homes, Ltd., award of $500,000 in 2006 Bond FundsEvaluation of progress on Bottom revitalization project after November ’08 Bond Sale and possible addition of $500,000

36

Next Steps

Continue discussions with THH on terms of loans and obligations of fundsJune 25, 2008 – City Council Consideration of $500,000 in Bond Funds July 2008 Acquisition residential properties to beginJanuary 2009 – Evaluate timing of future funding of project