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Resolution Authorizing Subordination of a Restrictive Covenant for the Property Located at 855 Lake Street
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Introduction
overview
The owners of 855 Lake Street are requesting the ability to subordinate the Affordable Housing Restrictive Covenant to a new first mortgage through Fannie Mae.
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Recommended Action
Approve the resolution.
Prior Board Action
The Board has taken the following prior action(s):
* RES 20-046: A Resolution Approving a Funding Grant Agreement in the Amount of $260,000 with Icon Clark, LLC Consistent with the Recommendation of the Oak Park Economic Development Corporation (Oak Park EDC) and Authorizing its Execution.
Background
855 Lake Street is a 64-unit apartment building rehabilitated over the last six years. In February 2020, the Village Board approved $260,000 from the Affordable Housing Fund (predecessor to the Housing Trust Fund) for Icon Clark, LLC to construct an exterior full cab elevator as part of their work rehabilitating and updating 855 Lake Street in order to address safety concerns. In turn, Icon Clark agreed to restrict 20% of units (i.e., 13 units) as affordable to households with incomes at or below 50% of the area median income for 15 years. The Village agreed to pay the $260,000 once the building received its final Certificate of Occupancy (CO). Due to several construction delays, the building did not receive its final CO until the end of 2025. As a result, staff have not disbursed the funds or signed the finalized agreement.
To secure the Village's affordable units, the Village requested that Icon Clark record an Affordable Housing Restrictive Covenant against the property. Icon Clark has requested that the covenant include subordination language that is required by their new first mortgage through Fannie Mae. The Village's original agreement with Icon Clark did not include such language, and staff would need Board approval to do so.
The Village has traditionally ag...
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