Item Description:
title
Neg Amd 1 to Facility Lease and Management Agreement with CHDC VA LLC, for the Veterans and Community Housing project; no cost to Authority
end
Resolution:
body
BE IT RESOLVED, that the Executive Director be authorized to negotiate Amendment 1 to the Facility Lease and Management Agreement dated September 7, 2005, between the Hennepin County Housing and Redevelopment Authority (Landlord) and CHDC VA LLC (Tenant), allowing the transfer of operating and replacement reserves held by Minnesota Housing to CHDC VA LLC, or an affiliated entity, for the continued benefit of the Veterans and Community Housing Project near the Minneapolis Veterans Administration Medical Center Campus; and that following review and approval by the County Attorney's Office, the Chair be authorized to sign the amendment and related documents on behalf of the Authority.
end
Background:
During the 2001-2002 session, the Minnesota Legislature adopted 2002 Minnesota Session Law, Chapter 393, Section 27, a general obligation bond appropriation to the Minnesota Housing Finance Agency (Minnesota Housing) of $16,200,000 for the construction of two transitional and permanent housing projects for veterans and single adults on property owned by the United States Department of Veterans Affairs (VA).
Minnesota Housing agreed to provide a $10,606,946 Publicly Owned Permanent Supportive Housing (POPSH) 20-year loan to the Hennepin County Housing and Redevelopment Authority (HCHRA) for construction of a project (140 units of affordable housing to veterans and single adults with incomes below 50% of the area median income) consistent with legislative direction (Resolution 05-HCHRA-14R1).
On September 7, 2005, the HCHRA executed a 60-year Enhanced-Use Lease agreement with the VA for 3 parcels consisting of approximately 4.34 acres near the Minneapolis Veterans Administration Medical Center Campus (Resolution 04-HCHRA-23S1R1).
Community Housing Development Corporation (CHDC) acted as developer of the project (Veterans and Community Housing).
Under a Facility Lease and Management Agreement dated September 7, 2005, the HCHRA continues to lease the property to CHDC VA LLC, an affiliated entity of Trellis Co., formerly known as Community Housing Development Corporation (CHDC), and Trellis Management Co. supervises the property management of the project.
Per POPSH terms and conditions, the project has contributed to state required operating and replacement reserves held by Minnesota Housing on behalf of the project. The 20-year HCHRA/Minnesota Housing POPSH loan was forgiven on September 8, 2025, and Minnesota Housing has requested transfer of reserves in a manner that continues to serve the project.
Amendment 1 to the Facility Lease and Management Agreement between HCHRA and CHDC VA LLC will ensure the reserves continue to be attached to the project and governed by the project roles and responsibilities for the HCHRA and Trellis Co.
Current Request: Authorize negotiation of Amendment 1 of the Facility Lease and Management Agreement for Vets and Community Housing, allowing the transfer of reserve management from Minnesota Housing Finance Agency (MHFA) to Trellis Co.’s affiliated entity CHDC VA LLC.
Impact/Outcomes: Approval of this request will streamline operations of the Vets and Community Housing Project, which provides 140 units of affordable rental housing to veterans and low-income single adults with incomes at or below 50% AMI.
recommendation
Recommendation from County Administrator: Recommend Approval