Title
Staff Report for a City of San Leandro City Council Resolution to Approve a General Fund Loan of $455,107.36 and Loan Agreement and Promissory Note, Secured by a Deed of Trust on 2539 Grant Avenue, San Leandro between the City and MTLG, LLC
StaffReport
SUMMARY AND RECOMMENDATIONS
Staff recommends that the City Council approve a General Fund Loan Agreement, at 2% simple interest per annum, evidenced by a Promissory Note, and secured by a recorded Deed of Trust on 2539 Grant Avenue, San Leandro between the City and MTLG, LLC, for $455,107.36.
BACKGROUND and ANALYSIS
MTLG, LLC, the "Borrower," owns real property located at 2539 Grant Avenue, San Leandro, CA 94579, APN 80G-910-15 (the "Property"). The Property is 204,732 square feet, flag shaped, and is zoned IG. It is improved with a 13,382 square foot building. A broker's opinion obtained by the City May 2018 provided a value of between $7,800,000 to $8,100,000. The City believes there is more than enough value in the property to insure repayment of the loan if there is a default. The Property is currently used by Halus Power Systems, a renewable energy manufacturing company (Halus).
On April 1, 2013, the City approved Halus' proposed wind energy conversion project and height variance ("Project") to be located on the Property. On May 8, 2013, interested persons ("Petitioners") filed a writ of mandate pursuant to the California Environmental Quality Act ("CEQA") in Alameda County Superior Court, Case No. RG13677840, alleging that the City, in its regulatory capacity, failed to comply with CEQA and CEQA Guidelines in approving the Project (the "Litigation"). On April 14, 2014, the Alameda County Superior Court entered judgment in favor of the Petitioners, and the court issued a writ of mandate to the City. Thereafter, the court awarded Petitioners' counsel attorneys' fees. The City and Halus appealed the award of attorneys' fees, but on January 12, 2018, the Court of Appeal upheld the trial court's ...
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