Title
Budget Ordinance in the amount of $160,000 to extinguish construction loans related to properties in Willow Oaks
Body
Department: Neighborhood Development and Planning
Council District: 1
Public Hearing: N/A
Advertising Date/By: N/A
Contact 1 and Phone: Barbara Harris, Neighborhood Development, 373-2509
Contact 2 and Phone: Sue Schwartz, FAICP, Planning, 373-2149
PURPOSE:
City Council is requested to approve a budget ordinance in the amount of $160,000 to fund the commitment to extinguish construction loans related to properties in Willow Oaks and provide clear title, allowing them to be sold to qualifying owner-occupants in an active redevelopment area.
BACKGROUND:
Areas of the Willow Oaks neighborhood slated for single family construction were conveyed to the non-profit Greensboro Housing Development Partnership (GHDP), with single family homes constructed by private builders through a ground lease managed by the site developer. Three houses built in 2008-2010 by OU Chavis Contracting Company remain unsold (2108 John Tarpley Lane, 2205 Charles Harshaw Avenue, and 812 Green Oaks Street). A map illustrating their location within Willow Oaks is attached.
OU Chavis Contracting has been sued by LSCG Fund 19, LLC (an entity related to LS Capital, LLC) for construction financing totaling $407,361.78 plus interest accruing since November 26, 2014. A judgment against the builder will cloud the titles of the three properties, with negative consequences for the Willow Oaks redevelopment neighborhood.
The City Attorney's office has negotiated the assumption and payoff of the three promissory notes securing the construction loans held by LS Capital, LLC for these three properties for a total of $160,000. Based on appraisals dated March 20, 2015, the appraised value of the properties totals $285,000. Two of the properties require minor repairs (related to vandalism) to resolve minimum housing code violations that were identified duri...
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