Bishop's Block SubordinationMasterpiece on the Mississippi
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Bishop's Block Subordination
DATE: September 14, 2011
Dubuque
hitti
AR-America City
I l r
2007
Housing and Community Development Department Director David Harris recommends
City Council approval of the subordination of the City's mortgage on the Bishop's Block
Building, at the request of Mercy Housing, Inc., in order to refinance existing
indebtedness on the property.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Michael C. Van Milligen
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
David Harris, Housing and Community Development Department
Masterpiece on the Mississippi
Dubuque
krittil
AA- America City
2007
TO: Michael Van Milligen, City Manager
FROM: David Harris, Housing and Community Development Department
SUBJECT: Bishop's Block Subordination
DATE: 9 September 2011
The purpose of this memorandum is to request your review and approval of the
subordination of the City's mortgage on the Bishop's Block building, at the request of
Mercy Housing Inc, in order to refinance existing indebtedness on the property.
The City made a $350 000 loan in 1993 to the developer of the project, Gleichman and
Company. The loan was a combination of CDBG and HUD Special Purpose Grant
funds. This financing was made subordinate to other funding sources, as follows:
Firstar Bank ($425 000); Iowa Housing Corporation ($100 000); Iowa Dept of Economic
Development HOME Program ($240 000); and the Federal Home Loan Bank of Des
Moines ($133 333.33).
In 1999, Mercy Housing Inc, dba McDermott Place, replaced Gleichman as the general
partner in the ownership LLC. Mercy has now negotiated a refinancing agreement with
American National Bank of Omaha, Nebraska, for the current balance of the first
mortgage, in the amount of $380 000. All other original mortgage balances remain the
same. The Federal Home Loan Bank mortgage will be forgiven later this year.
The project was also financed with Section 42 Low Income Housing Tax Credits and
remains in an extended compliance period, through 2024. This means tenant incomes
are restricted to no more than 60% of area median income, with rents capped at 30% of
tenant income.
This refinancing will improve Mercy's cash flow. No other debt is being added; no
equity is being withdrawn. A title search commissioned by our office shows no other
liens or mortgages on the property.
My recommendation is to subordinate the City's existing $350 000 mortgage, as
requested, in order for Mercy to refinance the first mortgage.
cc:
Crenna Brumwell, Asst City Attorney
att
SUBORDINATION AGREEMENT
WHEREAS, Bishop's Block, Limited Partnership, an Iowa limited partnership, having
an address at 1999 Broadway, Denver, Colorado 80202, ( "Mortgagor ") did execute and deliver
American National Bank, a national banking association the "Lender "), and its successors
andlor assigns (such entity, together with any subsequent holder of the Senior Mortgage (as
defined below), the "First Mortgagee "), having an address at 8990 West Dodge Road, Omaha,
NE 68114, the and City of Dubuque, a municipal corporation (such entity, together with any
subsequent holder of the Subordinate Mortgage Loan Documents (hereinafter defined), the
"City ") having an address at City Hall, 50 West 13th Street Dubuque, Iowa 52001 encumbering
certain real property owed in fee simple by Mortgagor, and more fully described in Exhibit A
attached hereto the "Mortgaged Property "); and
WHEREAS, the Mortgagor also executed and delivered to Lender that certain Mortgage,
Security Agreement, Assignment of Leases and Rents, and Fixture Financing Statement in the
original principal amount of $380,000.00, encumbering the Mortgaged Property, and this
Mortgage was recorded , 2011, in Instrument No.
, in the Dubuque County Recorder's Office the "Senior Mortgage "); and
WHEREAS, the Senior Mortgage was recorded after the City recorded that certain
mortgage in the original principal amount of $350,000.00, executed by Mortgagor in
favor of the City, recorded May 7, 1999 in Instrument No. 7663 -99, and the City now
wishes to subordinate the above - described Subordinate Mortgage in its favor to the above -
described Senior Mortgage in favor of the Lender;
NOW, THEREFORE, in consideration of the Mortgaged Property and other valuable
consideration, the City, the holder of the above - described Subordinate Mortgage, for itself and its
1
successors and assigns, does hereby subordinate such Subordinate Mortgage to the above -
described Senior Mortgage in favor of the Lender.
IN WITNESS WHEREOF, the City of Dubuque has caused this instrument to be
executed by its duly authorized officer on this 19th day of A gus , 2011.
September
SUBORDINATE MORTGAGEE:
ClT OF DUBUQUE„ .uni ' al corpo Lion:
By: �//
Name: Lynn V . Sutton
Title: Mayor Pro -Tem
STATE OF IOWA )
) ss.
COUNTY OF DUBUQUE)
The foregoing instrument was acknowledged before me this 19th day of
September , 2011 by Lynn V. Sutton, personally known to me to be the
person whose name is subscribed to the within instrument and acknowledged to me that he /she
executed the same in his authorized capacity, and that by his /her.signature on the instrument the
entity upon behalf of which the person acted, executed the instrument. Said person is the
Ma yo r Pro -T Pm [title] of the City of Dubuque, for and on behalf of said City of
Dubuque, and he/she acknowledged, signed and delivered the instrument as his/her free and
voluntary act, for the uses and purposes therein set forth.
2
KEVIN S: FIRNSTAHL
COMMISSION NO.745295
CO MY SLON XP/RES
#27970
DUBUQUE COUNTY ABSTRACT & TITLE COMPANY
ABSTRACTS OF TITLE
TELEPHONE 563/583 -4538 FAX 563/583 -2709
830 IOWA STREET P.O. BOX 565
DUBUQUE, IOWA 52004 -0565
Title Guaranty Division Member No. 8209
A.E. COOPER, President
P. W. COOPER, Vice President
DIANNE H. SKEMP, Secretary
JEAN M. SAWVEL, Ass't Secretary
August 23, 2011
City of Dubuque
Rehabilitation Office
350 W. 6th Street, Suite 312
Dubuque, Iowa 52001
Attn: Kris Neyen
RE: Mercy Housing, Inc./
Bishop Block Limited
Partnership
To Whom It May Concern:
We have this date made a search of the records of Dubuque County, Iowa, as to Lots 1
and 2 of the West 1/2 of Block 1 of Dubuque Harbor Co's Addition, in the City of
Dubuque, Iowa, according to the recorded plat thereof, and Lot 531 and the North 1/2 of
Lot 532 in the City of Dubuque, Iowa, according to the United States Commissioner's
Map of the Town of Dubuque, Iowa, from April 16, 2007 at 8 A.M., title to which rests in
Bishop's Block Limited Partnership. We also have searched the records as to Mercy
Housing, Inc.
The Mortgage made and executed by Bishop's Block LP to Iowa Housing Corporation,
dated August 20, 1993, filed August 26, 1993, and recorded in the Office of the Recorder
of Dubuque County, Iowa, as Instrument No. 11083 -1993, given to secure the sum of
$100,000.00, remains unsatisfied of record. Said Mortgage having been assigned by Iowa
Housing Corporation to Iowa Finance Authority by Assignment, dated August 1, 2001,
filed August 10, 2001 and recorded as Instrument No. 12703 -2001.
The Assignment of Leases and Rents made and executed by Bishop's Block LP, to Iowa
Housing Authority, dated August 20, 1993, filed June 18, 2001, and recorded in the
Office of the Recorder of Dubuque County, Iowa, as Instrument No. 9135 -2001, given to
secure the sum of $100,000.00, remains unsatisfied of record. Said Assignment Of Leases
and Rents having been assigned by Iowa Housing Corporation to Iowa Finance Authority
by Assignment, dated August 1, 2001, filed August 10, 2001 and recorded as Instrument
No. 12704 -2001.
The Mortgage made and executed by Bishop's Block Limited Partnership to Firstar Bank
Iowa, N.A., dated March 3, 1999, filed May 7, 1999, and recorded in the Office of the
Recorder of Dubuque County, Iowa, as Instrument No. 7655 -1999, given to secure the
sum of $425,000.00, remains unsatisfied of record.
In the Office of the Recorder, Dubuque County, Iowa, on May 7, 1999 there was filed an
Agreement of Subordination of Mortgage as Instrument No. 7659 -1999, wherein
Mortgage No. 11083 -1993, agrees to subordinate its Mortgage with Mortgage Nos. 7655-
1999 and 7657 -1999.
The Mortgage made and executed by Bishop's Block Limited Partnership to Firstar Bank
Iowa, N.A., dated March 3, 1999, filed May 7, 1999, and recorded in the Office of the
Recorder of Dubuque County, Iowa, as Instrument No. 7657 -1999, given to secure the
sum of $133,333.33, remains unsatisfied of record.
The Mortgage made and executed by Bishop's Block Limited Partnership to Iowa
Department of Economic Development, dated - - -, ack'd March 11, 1999, filed May 7,
1999, and recorded in the Office of the Recorder of Dubuque County, Iowa, as
Instrument No. 7660 -1999, given to secure the sum of $240,000.00, remains unsatisfied
of record. Said Mortgage having been assigned by Iowa Department of Economic
Development to Iowa Finance Authority by Assignment, dated - - - -, ack'd April 19, 2011,
filed April 25, 2011 and recorded as Instrument No. 2011 -5817.
The Agreement For Covenants And Restrictions made by and between Iowa Department
of Economic Development and Bishop's Block Limited Partnership, dated - - -, ack'd
March 19, 1999, filed May 7, 1999, and recorded in the Office of the Recorder of
Dubuque County, Iowa, as Instrument No. 7662 -1999. Said Agreement was assigned by
Iowa Department of Economic Development to Iowa Finance Authority by Assignment,
dated - - -, ack'd April 19, 2011, filed April 25, 2011 and recorded as Instrument No.
2011 -5829.
The Mortgage made and executed by Bishop's Block Limited Partnership to The City of
Dubuque, Iowa, dated March 5, 1999, filed May 7, 1999, and recorded in the Office of
the Recorder of Dubuque County, Iowa, as Instrument No. 7663 -1999, given to secure
the sum of $350,000.00, remains unsatisfied of record.
This property is subject to the City of Dubuque -Urban Renewal Development,
Real Estate Taxes on said premises are paid for fiscal year 2009 -2010 & for prior years.
Unpaid for fiscal year 2010 -2011. (Assessor's Code No. 1025290001).
Except as above shown, we find no unsatisfied mortgages, judgments, special
assessments, tax liens, mechanics liens or liens of any kind adverse to the title to the
above described real estate or against the above named owners.
Respectfully submitted
A. E. Cooper
President
js
Include this STUB with September 2011 payment.
Dubuque County Treasurer
Eric Stierman
720 Central Avenue
DubuquelA 52001
Phone (563)589 -4436
Tax Due:
Interest:
Costs:
Paid:
Due:
Full Year
$13,602.00
$0.00
$0.00
$0.00
$13,602.00
2010 CT
Report Date 08/29/2011
or September 2011
$6,801.00
$0.00
$0.00
$0.00
$6,801.00
BISHOP'S BLOCK LIMITED
PARTNERSHIP
90 MAIN
DUBUQUE IA 52001
Include this STUB with March 2012 payment.
Dubuque County Treasurer
Eric Stierman
720 Central Avenue
DubuquelA 52001
Phone (563)589 -4436
Tax Due:
Interest:
Costs:
Paid:
Due:
March 2012
$6,801.00
$0.00
$0.00
$0.00
$6,801.00
2010 CT
Report Date 08/29/2011
BISHOP'S BLOCK LIMITED
PARTNERSHIP
90 MAIN
DUBUQUE IA 52001
Receipt: 472867 Dist: DUBA Parcel: 1025290001 Receipt: 472867 Dist: DUBA Parcel: 1025290001
Year: 2010 Year: 2010
Dubuque County TAX BILL for SEPTEMBER, 2011 and MARCH, 2012. Keep in a safe place. Send the correct stubs along
with your check for payment. If your taxes are paid by your Bank in Escrow, this is for your information only.
Based on January 1, 2010 valuations. Taxes for July 1, 2010 through June 30, 2011. Payable September 2011 and March 2012.
P Dist/Parcel DUBA 1025290001 CITY OF DUBUQUE
A Receipt# 472867 Type: 2010 CT Location: 90 MAIN Class: C
R
C Deed: BISHOP'S BLOCK LIMITED Mail: BISHOP'S BLOCK LI1s/11TED
E
L
Legal: CITY LOTS 531 & N 1/2
532 & LOTS 1 & 2 OF w 1/2 ELK I DUBUQUEHARBOR CO ADD
VALUATIONS AND TAXES:
A
L Land:
jJ Buildings:
A Dwelling:
T TOTAL VALUES:
I Less Military Credit:
O Other Exemption:
N NET TAXABLE VALUE:
S Value Times Levy Rate of:
EQUALS GROSS TAX OF:
-r Less Credits of Homestead:
A Low- Income/Eldedy Credit:
Ag Land Credit:
E Family Farm Credit:
S Prepaid Tax:
NET ANNUAL TAXES:
2010 (This Year) 2009 (Last Year)
Assessed Taxable Assessed Taxable
96,600 46,600 46,600 46,600
335,800 335,800 308,170 308,170
0 0 0 0
382,400 382,400 354,770 354,770
0 0
382,400 382,400 354,770 354,770
35.5710800 35.0055500
$13,602.38 $12,418.92
$0.00 $0.00
$0.00 $0.00
$0.00 $0.00
$0.00 $0.00
$0.00
$13,602.00 $12,418.00
INDEXING:
N
D
E
X
N
G
O DEED:
N
• CON1:
BISHOPS BLOCK LIMITED
PARTNERSHIP
90 MAIN
DUBUQUE IA 52001
State Tax Relief already deducted from Tax: $62.79
Taxing Authority:
TIF 2 FUND - URBAN R
DUBUQUE COMM. SCHOOL
CITY OF DUBUQUE
COUNTY LEVY
N1CC AREA I
CITY ASSESSOR
COUNTY HOSPITAL
AG EXTENSION OFFICE
T.B. & BRUCELLOSIS E
Distribution of YOUR current year faxes: TOTAL property taus levied by taxing authority:
of total This year 2010 Last year 2009 This year Last year Percent +1-
75.847% 10,316.69 8,294.10 587,612 350,117 67.833+
12.028% 1,636.01 2,047.65 46,755,359 49,909,358 9.122+
6.185% 841.22 1,081.90 20,615,215 19,169,221 7.571+
9.060% 552.27 725.95 26,653,787 25,942,400 9.761+
1.987% 202.31 209.49 9,757,798 9,060,921 7.691+
196% 26.72 27.97 668,572 993,233 35.599+
151 20.56 28.15 923,715 897,690 2.899+
044 5.97 3.93 268,317 109,420 195.218+
.002% .25 .36 11,351 11,557 1.782-
TOTALS: 13,602.00 12,418.00 106,241,726 100,433,917 5.783+
YOU MAY PAY ONLINE AT: www.iowatreasurers.org Your Tax Receipt Number is: 2010 472867
Dubuque County Treasurer Due in September 2011 S6,801.00 Due in March 2012 56,801.00
Eric Stierman
720 Central Avenue Data Paid: Date Paid.
Dubuque IA 52001
Phone (563)589 -4436 Check # Check 4
Retain this lower portion for your records. Fitter the date paid and your check number for your information. Keep in a safe place.
Include this STUB with September 2011 payrnent.
Dubuque County Treasurer 2010 CT
Eric Stierman
720 Central Avenue
Dubuque IA 52001
Phone (563)589 -4436 Report Date 08/29/2011
Tax Due:
Interest:
Costs:
Paid:
Due:
Full Year
$13,602.00
$0.00
$0.00
$0.00
$13,602.00
or September 2011
$6,801.00
$0.00
$0.00
$0.00
$6,801.00
BISHOP'S BLOCK LIMITED
PARTNERSHIP
90 MAIN
DUBUQUE IA 52001
Include this STUB with March 2012 payment.
Dubuque County Treasurer
Eric Stierman
720 Central Avenue
DubuquelA 52001
Phone (563)589 -4436
Tax Due: March 2012
$6,801.00
Interest: $0.00
Costs: $0.00
Paid: $0.00
Due: $6,801.00
2010 CT
Report Date 08/29/2011
BISHOP'S BLOCK LIMITED
PARTNERSHIP
90 MAIN
DUBUQUE IA 52001
Receipt: 472867 Dist: DUBA Parcel: 1025290001 Receipt: 472867 Dist: DUBA Parcel: 1025290001
Year :2010 • Year:2010
Dubuque County TAX BILL for SEPTEMBER, 2011 and MARCH, 2012. Keep in a safe place. Send the correct stubs along
with your check for payment. If your taxes are paid by your Bank in Escrow, this is for your information only.
Based on January 1, 2010 valuations. Taxes for July 1, 2010 through June 30, 2011. Payable September 2011 and March 2012.
P Dist/Parcel DUBA 1025290001 CITY OF DUBUQUE
A Receipt# 472867 Type: 2010 CT Location: 90 MAIN Class: C
R
C Deed: BISHOP'S BLOCK LIMITED Mail: BISHOP'S BLOCK LIMITED
E
L
Legal: CITY LOTS 531 & N 1/2
532 & LOTS 1 & 2 OF
W 1/2 BLK I DUBUQUEHARBOR CO ADD
VALUATIONS AND TAXES:
A
L Land:
U Buildings:
A Dwelling:
T TOTAL VALUES:
I Less Military Credit:
O Other Exemption:
N NET TAXABLE VALUE:
S Value Times Levy Rate of:
EQUALS GROSS TAX OF:
Less Crodits of Homestead:
Low-income/Elderly Credit:
Ag Land Credit:
Family Farr Credit:
Prepaid Tax:
2010 (This Year)
Assessed Taxable
46,600 46,600
335,800 335,800
0
382,400
T
A
E
S
382,400
0
382,400
0
382,400
35.5710800
613,602.38
$0,00
$0.00
$0.00
$0.00
$0.00
NET ANNUAL TAXES: $13,602.00
2009 (Last Year) INDEXING:
Taxable N
D
E
0 0 X
354,770 1
0 N
G
Assessed
46,600 46,600
308,170 308,170
354,770
354,770
354,770
35.0055500
$12,418.92
$0.00
$0.00
$0.00
• $0.00
$12,418.00
O DEED:
w
N
• CONT:
BISHOP'S BLOCK LIMITED
PARTNERSHIP
90 MAIN
DUBUQUE IA 52001
State Tax Relief already deducted from Tax: $ 62.7 4
Taxing Authority:
TIF 2 FUND - URBAN R
DUBUQUE COMM. SCHOOL
CITY OF DUBUQUE
COUNTY LEVY
N1CC AREA 1
CITY ASSESSOR
COUNTY HOSPITAL
AG EXTENSION OFFICE
T.B. & BRUCELLOSIS E
Distribution of YOUR current year taxes:
of total This year 2010 Last year 2009
75.847% 10,316.69 8,294.10
12.028% 1,636.01 2,047.65
6.185% 841.22 1,081.90
4.060% 552.27 725.45
1.487% 202.31 209.49
.196% 26.72 27.47
.151% 20.56 28.15
.044% 5.97 3.93
.002% .25 .36
TOTALS: 13,602.00
YOU MAY PAY ONLINE AT: w►wv.iowatreasurers.otg
Dubuque County Treasurer Due in September 2011
Eric Stierman
TOTAL Property taxes
This year
587, 612
46,755,359
20,615,215
26,653,787
9,757,798
668,572
923,715
268, 317
11,351
levied by taxing authority:
Last year
350,117
49,904,358
19,164,221
25,492,400
9,060,921
993,233
897,690
109,420
11,557
Percent +/-
67.833+
4.122+
7.571+
4.761+
7.691+
35.549+
2.899+
145.218+
1.782-
12,418.00 106,241,726 100,433,917 5.783+
Your Tax Receipt Number is: 2010 472867
S6,801.00 Due in March 2012 S6,801.00
720 Central Avenue Date Paid: Dale Paid:
DubuquelA 52001
Phone (563)589 -4436 Check # Check #
Retain this lower portion for your records. Enter the date paid and your check number for your information. Keep in a safe place.
EXHIBIT "A"
LEGAL DESCRIPTION
All that certain real property located in the County of Dubuque, State of Iowa described as
follows:
Lots 1 and 2 of the West One -Half of Block 1 of Dubuque Harbor Co.'s Addition in the City of
Dubuque, Iowa, according the recorded Plat thereof; and
Lot 531 and the North One -Half of Lot 532 in the City of Dubuque, Iowa, according to the
United States Commissioners' map of the Town of Dubuque, Iowa,
A -1