Council authorizes subordination agreement to help refinance Auburn Square Apartments

The City Council on March 10 ratified authorization for the city manager to execute a subordination agreement intended to enable refinancing of Auburn Square Apartments.

City staff explained the resolution removes a prior condition that the subordination be concurrently approved by TDHCA (Texas Department of Housing and Community Affairs). Staff said Texas Mezzanine Fund will pay off an existing TDHCA loan and that removing the concurrent‑approval condition allows the refinancing and closing to proceed.

Vivian Belew, representing Legacy (the nonprofit partner that took ownership to stabilize Auburn Square), described taking responsibility for the property after prior partners withdrew, securing about $1.1 million in refinancing to stop a foreclosure and raise occupancy from roughly 35% to about 85%. She told the council Legacy paid substantial legal fees and completed repairs and that the requested subordination would allow the developer to obtain a 30‑year mortgage and repay prior obligations so renovations can be completed. She said the city’s loan balance would remain $500,000 and that the change removes contingency tied to TDHCA’s concurrent signature.

A city staff speaker confirmed the expenditures tied to the refinance are HUD‑eligible repairs and that the arrangement carries no additional liability for the city on the loan. Council members praised Legacy’s work stabilizing the property and voted to authorize the city manager to execute the agreement.

Council’s approval removes the prior concurrent‑approval condition and empowers staff to finalize the refinancing documents. The motion passed by voice vote; the transcript records council members’ “aye” responses but does not list a roll‑call tally for named votes in the minutes.