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Council approves MOA to let Downtown Renaissance advance $80,000 loan to Epstein Properties, contingent on bank financing
Summary
The council approved a memorandum of agreement allowing Downtown Renaissance Inc. to loan $80,000 to Epstein Properties for working capital and authorizing the city to reimburse DRI from grant funds as reimbursements become payable; council discussion emphasized the arrangement is contingent on the developer securing a private construction loan.
The Rocky Mount City Council approved a memorandum of agreement (MOA) among the city, Downtown Renaissance Inc. (DRI) and Epstein Properties LLC that will allow DRI to advance an $80,000 working-capital loan to Epstein Properties and for the city to reimburse DRI from grant reimbursements as those funds are released.
City staff and Councilman Varney (who discussed the item) said the developer had struggled to secure construction financing and that the MOA is intended to bridge working-capital needs so the renovation of the Epstein building at Tarboro and Main Street can proceed. “What this memorandum of agreement would do would be to have Downtown Renaissance loan $80,000 to Epstein Properties, for his use as working capital. And then the city, as it releases its grant funding, would reimburse DRI for the amount of the loan until that loan is paid off,” Varney said.
Council members sought clarification about the status of private bank financing. Councilman Varney and others characterized the deal as contingent on the private bank closing a construction loan; Varney said he had not yet seen a qualified commitment letter but that the plan was for the two loans to occur simultaneously. Varney also noted DRI would vote on the same item the following day.
The MOA assigns interest responsibility to Epstein Properties and makes reimbursement dependent on the city’s release of grant funds to DRI. The motion to adopt the MOA was made by Councilman Blackwell and seconded by Councilman Joiner; the motion passed by voice vote.
