APARTMENT LOAN NEWS OF THE WEIRD:
David Flaherty, CEO of Flaherty & Collins, listens during Tuesday night’s public hearing at Orland Park Village Hall concerning the Main Street redevelopment project at 143rd Street and LaGrange Road.
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In this SWEETHEART DEAL ORLAND PARK gives $24 MILLION in INCENTIVES* on $60 Million INVESTMENT - Indianapolis Owner invests $1 million and the CITY becomes the COMMERCIAL REAL ESTATE LENDER
The financial deal, which the village board is expected to vote on at its Sept. 19 meeting, includes a $38 million loan to Flaherty and Collins, with Orland Park providing another $24 million as an incentive to the company. The developer is putting up $1 million of its own money plus another $1 million in fees.
The most controversial aspect of the proposal is that the village will cover initially all but about $1 million of the $63 million project by taking out a line of credit at a bank and selling bonds — putting itself at considerable financial risk if the apartments are not successful.*
Deal Structure: Orland Park corporate guarantee to bank - Bank Letter of Credit., bonds rated sold by investment banker money used for both incentives and construction loan. Risk 1, completion 2. loan repayment 3. $24,000,000 incentive unpopular with citizens - city leaders sacked.
