Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Economic Development topic
No spam. Unsubscribe anytime.
Council waives reversionary clause for Grand River Walk developer to clear mortgage; developers pledge swift mobilization
Summary
Painesville City Council approved a third amended development agreement with Grand River Walk LLC for 257 East Main Street, removing a reversionary clause to allow the senior lender to take a clean mortgage. Developers said the change is the final condition for financing and pledged to mobilize within weeks of closing.
Painesville City Council voted to authorize the city manager to enter a third amended development agreement with Grand River Walk LLC for development at 257 East Main Street. The amendment removes a reversionary clause that lenders said prevented issuance of a clean mortgage and was the last outstanding condition for the senior lender to close financing.
John Saenz, representing Grand River Walk LLC, told council the developer is close to closing and needs the amendment to satisfy the senior lender’s title requirements. Michael Vidmar, director of development for Merus Development Group, explained that lender checklists and market conditions have evolved since the project’s earlier approvals; Huntington Bank provided a letter confirming the requirement and committed to the financing. Developers said they increased the amount of a contractual penalty tied to performance to give the city more assurance if the project does not proceed.
Council members said they toured a similar completed project and praised the design. Members also pressed developers for clarity on deadlines and penalties. According to the execution copy and the discussion, if the developer did not commence at least $1,000,000 in construction by an agreed date (September 30 in the conversation), the developer would pay a monetary penalty (discussion indicated a $750,000 penalty in the negotiated language). Developers said that once financing closes they expect to mobilize and move dirt within a week or two.
Council then approved a motion to suspend the remaining readings and adopted the amended agreement as an emergency so the developer could close financing and proceed. The council vote on adoption recorded affirmative votes from multiple members.
Council vote on adoption (as recorded in meeting transcript): Mister Rodriguez — yes; Mrs. Shue (listed in transcript as "Shoop/Shue") — yes; Mister Abney — yes; Mister Augustine — yes; Mrs. DiNello — yes; Mister Hack — yes; Mister Fodor — yes; Mister Foter — yes. No no votes or abstentions were recorded in the transcript excerpt provided.
Next steps: Developers will proceed to close financing and begin site mobilization; the city will monitor progress against the milestone and enforce the penalty provisions if the developer fails to meet the agreed start-date milestone.
