City of Warsaw

NOTICE OF EXECUTION AND APPROVAL OF LEASE
BETWEEN THE CITY OF WARSAW BUILDING CORPORATION
AND THE CITY OF WARSAW REDEVELOPMENT COMMISSION
The City of Warsaw Redevelopment Commission (the “Commission”), the governing body of the Department of Redevelopment of the City of Warsaw, Indiana (the “City”), and the Redevelopment District of the City of Warsaw, Indiana (the “District”), has executed a Lease Agreement (the “Lease”) with the City of Warsaw Building Corporation (the “Building Corporation”), dated as of January 8, 2024, providing for the lease by the Commission, as Lessee, from the Building Corporation, as Lessor, of a portion of Market Street in the City extending from the intersection of Market Street and Argonne Road to the intersection of Market Street and State Road 15 (collectively, the “Leased Premises”), for the purpose of enabling the Building Corporation to make note payments in support of taxable economic development lease rental revenue bonds to be issued by the City (the “Bonds”) for the purposes of providing a means to finance all or any portion of (i) the rehabilitation of the existing Gatke Warehouse located at 2321 E. Winona Ave., Warsaw, Indiana by restoring the current steel structure with beautiful brick, large warehouse style windows, and modern and functional interior finishes, which rehabilitation will result in an approximately 12,000 square foot space comprised of eight (8) flex units (residential or commercial) and approximately 4,300 square feet of commercial space that provides for a mix of residential studios, offices, restaurant, innovation/lab space, or other related uses (the “Warehouse Project”) and (ii) the construction and equipping of the new Gatke Lofts at 2321 E. Winona Ave., Warsaw, Indiana, comprised of seventy-five (75) market-rate one- and two-bedroom Class-A apartments with amenities, including fitness center, a rooftop terrace, indoor/outdoor lounge cafe, courtyard, trail access, bike storage and with modern finishes including quartz counters, stainless steel appliances, full-size washer/dryer, tile backsplash in kitchen and bathrooms, 9-foot ceilings, and private balconies/patios in each unit (the “Loft Project” and together with the Warehouse Project, the “Project”) (the “Project”). The proceeds of the Bonds will be loaned to the Building Corporation to finance all or a portion of the Project.
After a public hearing on the proposed Lease held by the Commission on January 8, 2024, at which all interested parties were provided the opportunity to be heard, the Commission adopted a Resolution which, among other things, authorized and directed the President or Vice President and the Secretary of the Commission, on behalf of the City, to execute and deliver the Lease in substantially the form presented at the public meeting, found that the rental payments to be paid by the Commission are fair and reasonable, that the use of the Leased Premises under the Lease throughout the term of the Lease will serve the public purpose of the City, and is in the best interests of its residents.
The Common Council of the City adopted a Resolution approving the Lease on January 2, 2024, and the Building Corporation adopted a Resolution approving the Lease on December 5, 2023.
The Lease will have a term of no longer than twenty-five (25) years beginning on the date the Building Corporation acquires any interest in the leased premises and ending on the day prior to a date not later than twenty-five (25) years after such date of acquisition by the Building Corporation. The maximum annual lease rental to be paid by the Commission under the proposed Lease is $250,000. After the sale of the Bonds by the City, the annual rental shall be reduced to an amount sufficient to pay the principal and interest due in each twelve (12) month period commencing each year on August 1 rounded up to the next One Thousand Dollars ($1,000), together with incidental expenses as further described in the Lease, payable in advance in semi-annual installments. The Commission’s lease payments under such Lease will be payable from a special benefits tax levied and collected by the Commission on all taxable property within the geographical boundaries of the District pursuant to applicable law, as amended, provided that the Commission reasonably expects not to use the special benefits tax and expects to pay the lease payments under the Lease from any revenues legally available to the Commission. The Lease further provides for terms concerning the use, maintenance, repair, operating and utility costs, indemnification and insurance, destruction of the premises, defaults, remedies, option to purchase, reduction of the lease rental and term following the sale of bonds by the Building Corporation for the Project, and miscellaneous other matters.
The proposed Lease is open to public inspection at the office of the Community & Economic Development Director in City Hall, 102 S. Buffalo Street, Warsaw, Indiana.
Dated this 12th day of January, 2024.
CITY OF WARSAW REDEVELOPMENT COMMISSION
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