MARBELLA RANCH SUMMIT - SUMMARY LETTER (FINAL APPROVAL).PDF
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8687 East Via de Ventura, Suite 306 Scottsdale, Arizona 85258 www.mcida.com April 30, 2026 To: Board of Supervisors Board of Directors Maricopa County, Arizona The Industrial Development Authority of the County of Maricopa Re: Not-To-Exceed $48,000,000 The Industrial Development Authority of the County of Maricopa Multifamily Housing Revenue Bonds (The Summit at Marbella Ranch Project) (the “Bonds”) Ladies and Gentlemen: At the meeting of the Board of Directors (the “Board”) of The Industrial Development Authority of the County of Maricopa (the “Authority”) on May 12, 2026, the Board will be asked to grant final approval and adopt a resolution authorizing the issuance and sale of the Bonds for construction of a new multifamily housing project described below (the “Project”). This letter provides a summary of the proposed financing. AUTHORITY The Authority is an Arizona nonprofit corporation designated by law as a political subdivision of the State of Arizona. The Authority was formed with the permission of Maricopa County, Arizona (“Maricopa County”), and incorporated under and pursuant to the Arizona Industrial Development Financing Act, Title 35, Chapter 5, Arizona Revised Statutes, as amended (the “Act”). APPLICANT/BORROWER The Applicant/Borrower, Marbella Ranch AH II, LLLP (the “Borrower”), is a Minnesota limited liability limited partnership. The Borrower is an affiliated entity of Real Estate Equities (REE), a 50- year old multifamily development and property management company. REE has developed and managed over 12,000 multifamily housing units across the country, including multiple projects in Arizona, and retains ownership in its projects long-term. The Borrower will be partnering with a nonprofit known as Rainbow Housing Assistance Corporation to provide supportive and educational services to the residents. PROJECT The proposed Project will provide 252 units of affordable housing situated on approximately 16.6 acres of real property located at or at or near the southeast corner of El Mirage Road and Northern Parkway in Maricopa County, Arizona. The Project is located in Supervisorial District No. 4. Board of Supervisors Board of Directors April 30, 2026 Page 2 NOTIFICATION TO ARIZONA ATTORNEY GENERAL As required by the provisions of Arizona Revised Statutes, Section 35-721.F, the Authority will notify the Arizona Attorney General of its intention to issue the Bonds. TAX EXEMPT FINANCING Pursuant to Section 147(f) of the Code, the Maricopa County Board of Supervisors must approve the issuance of the Bonds after a public hearing following reasonable public notice. A representative of the Authority conducted a public hearing regarding issuance of the Bonds on April 28, 2026. On or prior to closing, the Authority will receive an opinion from Bond Counsel that interest on the Bonds will be exempt from federal and State income taxes. A tax certificate will be executed by the Authority and Borrower to evidence various representations and agreements aimed at establishing and preserving the tax-exempt status of the Bonds. ALLOCATION FOR TAX EXEMPT FINANCING The Borrower must receive from the Arizona Finance Authority an allocation of the Arizona “volume cap” for financing a portion of the costs of acquiring, constructing and equipping the Project in order for the Bonds to be qualified private activity bonds under Section 142(d) of the Code and the interest to be exempt from federal income taxes. FINANCING PARTICIPANTS The financing professionals are as follows: Bond Counsel: Kutak Rock, LLP Borrower’s Counsel: Winthrop & Weinstine, P.A. Underwriter’s Counsel: Greenberg Traurig, LLP Underwriter: FMSbonds, Inc. Trustee: U.S. Bank Trust Company, NA PRINCIPAL FINANCING DOCUMENTS Document Parties Indenture of Trust, including the forms of the Bonds (“Bond Indenture”) Authority and Trustee Loan Agreement, including form of the Promissory Note Authority and Borrower Regulatory Agreement Authority, Borrower and Trustee Reserved Rights Guaranty Authority and Guarantor Bond Purchase Agreement Authority, Borrower and Underwriter Board of Supervisors Board of Directors April 30, 2026 Page 3 PLAN OF FINANCING The Authority will issue the Bonds under and pursuant to the terms and provisions of the Bond Indenture in the aggregate principal amount not to exceed $48,000,000. The proceeds from the sale of the Bonds will be loaned by the Authority to the Borrower pursuant to the terms of the Loan Agreement. The Borrower will enter into the Loan Agreement to evidence the obligations of the Borrower to make loan repayments in amounts necessary to pay the principal and interest on the Bonds. Borrower’s repayment obligations in respect of the Loan will be evidenced by a promissory note. The Project will be subject to the Regulatory Agreement with the Authority, under which the Borrower will be required to set aside 40% of the Project units for persons with annual incomes no greater than 60% of the Area Median Income. It is anticipated that the Project will be further income and rent restricted by a regulatory agreement executed by the Borrower in connection with Federal low- income housing tax credits. The Bonds will be sold by the Underwriter and the other purchaser or purchasers pursuant to the bond purchase agreement. FINAL APPROVAL At its meeting on May 12, 2026, the Authority Board will be asked to grant final approval and adopt a resolution authorizing the issuance and sale of the Bonds and related matters. A form of the Authority Board’s resolution is attached hereto. BOARD OF SUPERVISORS APPROVAL Under the provisions of A.R.S. § 35-721.B., the Bonds to be issued by the Authority require the approval of the Maricopa County Board of Supervisors. The Maricopa County Board of Supervisors is being requested, at its meeting on May 20, 2026, to act as required by law to adopt a resolution approving the issuance of the Bonds under the Act. Under the provisions of the Act, specifically A.R.S. § 35-742, Maricopa County is not in any event liable for the payment of principal or interest on any bonds, notes or other obligations issued by the Authority or for the performance of any pledge, mortgage, obligation or agreement of any kind undertaken by the Authority, and none of the bonds, notes or other obligations, or any of its obligations thereunder, shall be construed to constitute an indebtedness of Maricopa County within the meaning of any constitutional or statutory provision. Board of Supervisors Board of Directors April 30, 2026 Page 4 LEGAL COUNSEL RECOMMENDATION General Counsel to the Authority has reviewed drafts of the principal financing documents and, based upon her review of such and her review of the proceedings of the Authority to date relating to the proposed issuance of the Bonds, she believes the principal financing documents are in substantially final form, adequately meet the requirements of the Act, and are in both form and substance acceptable for the Authority Board to act upon, and that the Resolution of the Authority Board authorizing the issuance and sale of the Bonds and related matters and the Resolution of the Maricopa County Board of Supervisors approving the Bonds to be issued and related matters, are in form and substance acceptable for adoption. A RESOLUTION OF THE BOARD OF DIRECTORS OF THE INDUSTRIAL DEVELOPMENT AUTHORITY OF THE COUNTY OF MARICOPA (I) AUTHORIZING THE ISSUANCE AND SALE OF ONE OR MORE SERIES OF ITS TAX-EXEMPT AND/OR TAXABLE, SENIOR AND/OR SUBORDINATE MULTIFAMILY HOUSING REVENUE BONDS (SUMMIT AT MARBELLA RANCH PROJECT), SERIES 2026, IN AN AGGREGATE ORIGINAL PRINCIPAL AMOUNT OF NOT TO EXCEED $48,000,000 AND RELATED MATTERS; AND (II) AMENDING THE PRELIMINARY APPROVAL RESOLUTION ADOPTED ON DECEMBER 9, 2025 WHEREAS, The Industrial Development Authority of the County of Maricopa (the “Authority”) is an Arizona nonprofit corporation designated as a political subdivision of the State of Arizona (the “State”), incorporated with the approval of Maricopa County, Arizona (the “County”), pursuant to the provisions of the Constitution and laws of the State and under the Industrial Development Financing Act, Arizona Revised Statutes §§ 35-701 et seq, as amended (the “Act”); and WHEREAS, the Authority is authorized and empowered, among other things, to issue revenue bonds for the purposes set forth in the Act, including the making of secured and unsecured loans to finance or refinance the acquisition, construction, improvement, equipping or operating of a “project” (as defined in the Act), whenever the Board of Directors of the Authority (the “Board of Directors”) finds such loans to further advance the public interest; and WHEREAS, Marbella Ranch AH II, LLLP is a duly organized and validly existing Minnesota limited liability limited partnership (the “Borrower”); and WHEREAS, on December 9, 2025, the Authority adopted a resolution granting preliminary approval (the “Preliminary Approval Resolution”) to the issuance of its multifamily housing revenue bonds, notes or other obligations, in one or more tax-exempt and/or taxable series, in an aggregate principal amount not to exceed $48,000,000, for the benefit of the Borrower, or its assigns and designees; and WHEREAS, the Borrower has informed the Authority that due to an administrative error, the “Applicant” was incorrectly identified as “Marbella Ranch AH III, LLLP,” rather than “Marbella Ranch AH II, LLLP,” in the Bond Financing Application dated November 21, 2025 and in the Preliminary Approval Resolution, and now requests that the Authority amend the Preliminary Approval Resolution to correct such error; and WHEREAS, the Borrower has requested that the Authority issue its revenue bonds for the purposes of financing and/or refinancing, as applicable, a portion of the costs of: (i) the acquisition, construction, improvement, equipping and/or operation, as applicable, of a qualified residential rental facility (including improvements and facilities functionally related and subordinate thereto) which is expected to be comprised of approximately 252 units (all or a portion of which will be set aside for occupancy by low- to moderate-income tenants) situated on approximately 16.6 acres of real property located at or near the southeast corner of El Mirage Road and Northern Parkway in Maricopa County, Arizona (collectively, the “Facilities”); and 2 WHEREAS, the Borrower now requests that the Authority (i) grant its final approval to the issuance and sale of its Multifamily Housing Revenue Bonds (Summit at Marbella Ranch Project), in one or more tax-exempt and/or taxable, senior and/or subordinate series (the “Bonds”), pursuant to a plan of financing in an aggregate principal amount of not to exceed $48,000,000, the proceeds of which Bonds will be loaned (the “Loan”) to the Borrower to (i) finance all or a portion of the costs of acquiring and developing the Facilities (as described above), (ii) funding any required reserves, (iii) paying capitalized interest on the Bonds, if any, and (iv) paying certain costs and expenses related to the issuance of the Bonds (collectively, the “Project”); and WHEREAS, in furtherance of the purposes of the Act and in the interest of the Authority and the public thereunder, the Authority proposes to issue the Bonds and loan the proceeds thereof to the Borrower to finance all or a portion of the costs of the Project; and WHEREAS, the Bonds will be issued pursuant to a certain indenture of trust (the “Indenture”), between the Authority and U.S. Bank Trust Company, National Association, a national banking association (or such other trustee that may be selected by the Borrower and acceptable to the Authority), as trustee (the “Trustee”), and the proceeds of the Bonds will be loaned to the Borrower pursuant to a certain loan agreement (the “Loan Agreement”), between the Authority and the Borrower; and WHEREAS, the Borrower’s repayment obligations in respect of the Loan will be evidenced by one or more promissory notes (collectively, and together with all riders and modifications thereto, the “Borrower Note”) delivered to the Authority and endorsed by the Authority to the Trustee as security for the Bonds; and WHEREAS, pursuant to the Indenture, the Authority will pledge, and grant a lien on and security interest in, the trust estate established under the Indenture (the “Security”) to the Trustee, and the Bonds will be payable solely from such Security; and WHEREAS, in order to assure the Authority and the holders of the Bonds that interest on the Bonds will be excludable from gross income of the owners thereof for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986, as amended (the “Code”), and to satisfy the public purposes for which the Bonds are authorized to be issued under the Act, and to satisfy the purposes of the Authority in determining to issue the Bonds, certain limits on the occupancy of units in the Facilities and other requirements have been established pursuant to the terms of a Regulatory Agreement and Declaration of Restrictive Covenants, to be dated as of the first day of the month in which the Bonds are issued, among the Authority, the Trustee and the Borrower (such Regulatory Agreement, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the “Regulatory Agreement”); and WHEREAS, the Bonds will be sold by FMSbonds, Inc., as underwriter (the “Underwriter”), pursuant to a certain bond purchase agreement (the “Bond Purchase Agreement”), among the Authority, the Borrower and the Underwriter; and WHEREAS, the Borrower’s obligations to the Authority with respect to payment of the Authority’s fees, costs, and expenses and any indemnification obligations in connection with, and 3 pursuant to, certain of the hereinafter defined Documents will be guaranteed pursuant to a Reserved Rights Guaranty, to be dated as of the first day of the month in which the Bonds are issued (the “Reserved Rights Guaranty”), delivered by REE Guarantor, LLC, a limited liability company duly organized and validly existing under the laws of the State of Minnesota (or such other guarantor that is acceptable to the Authority), as guarantor thereunder (“Guarantor”), in favor of the Authority; and WHEREAS, there have been prepared and presented to the Board of Directors of the Authority substantially final forms of the following documents which the Authority proposes to approve or authorize (collectively, the “Documents”): (a) the Indenture, including the forms of the Bonds; (b) the Loan Agreement, including the forms of the Borrower Notes; (c) the Regulatory Agreement; (d) the Reserved Rights Guaranty; and (e) the Bond Purchase Agreement. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of The Industrial Development Authority of the County of Maricopa, as follows: Section 1. Ratification of Actions. All actions (not inconsistent with the provisions of this Resolution) heretofore taken by or at the direction of the Authority and its directors, officers, counsel, advisors, or agents directed toward the issuance and sale of the Bonds, are hereby approved and ratified. Section 2. Findings. The Board of Directors finds and determines that the issuance of the Bonds and the making of one or more loans to the Borrower for the purpose of financing all or a portion of the cost of the Project and the costs and expenses incidental thereto, are in furtherance of the purposes and interests of the Authority and the Act and are in the public interest, and that the Project will constitute a “project” within the meaning of the Act. Section 3. Authorization and Terms of Bonds. The Bonds, which shall be named as set forth herein or as otherwise set forth in the Indenture, are hereby approved and authorized to be issued pursuant to a plan of finance in an aggregate principal amount of not to exceed $48,000,000, in one or more series, to be dated, to mature (no later than 40 years after their date of issuance), to bear interest (not in any event to exceed twelve percent (12%) per year, as of the date of issuance and subject to adjustment as set forth in the Indenture, provided that the rate will not exceed the maximum rate permitted by law), to be subject to redemption, to be payable as to principal and interest, and with such other terms, all as provided in the executed Indenture and the Bond Purchase Agreement. Section 4. Special Limited Obligations. The Bonds shall be payable solely from the property held and receipts and revenues received by or on behalf of the Authority pursuant to the Indenture and the Loan Agreement. Nothing contained in (a) this Resolution, (b) the Documents, or (c) any other agreement, certificate, document, or instrument executed in connection with the 4 issuance of any of the Bonds shall be construed as obligating the Authority (except as a special, limited obligation to the extent provided in such documents or instruments), or obligating the County or the State, to pay the principal of or premium, if any, or interest on the Bonds, or as incurring a charge upon the general credit of the Authority, the County or the State, nor shall the breach of any agreement contemplated by this Resolution, the Documents, or any other instrument or documents executed in connection herewith or therewith impose any charge upon the general credit of the Authority, the County or the State. The Authority has no taxing power. Section 5. Conditions. The Bonds shall only be issued if: (a) The Board of Supervisors of the County has approved the issuance of the Bonds. (b) The Arizona Attorney General does not inform the Authority that the Project does not come within the purview of the Act in the manner contemplated by Arizona Revised Statutes § 35-721. (c) Satisfaction of all requirements of the Code applicable to the Bonds, including Section 147 of the Code. (d) The Authority receives an opinion from Kutak Rock LLP, as bond counsel (the “Bond Counsel”), in a form acceptable to the Authority, to the effect that interest on any tax-exempt series of the Bonds will be exempt from federal income taxes and that interest on the Bonds will be exempt from State income taxes. (e) The Borrower delivers an opinion or opinions, addressed and in form acceptable to the Authority, to the effect that any offering materials distributed in connection with the offer and sale of the Bonds are correct and complete in all material respects, and do not contain any untrue statements of material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. (f) For privately placed Bonds, the Authority must receive investment letters from the initial purchaser(s) (or the equivalent representations from the Underwriter) in form and substance satisfactory to the Authority’s legal counsel and any subsequent transfers of the Bonds must be limited to “accredited investors” within the meaning of Rule 501 of Regulation D or “qualified institutional buyers” within the meaning of Rule 144A, promulgated under the Securities Act. (g) The Authority, its officers and directors, and the County, are provided with full indemnification in connection with the issuance and sale of the Bonds, in form and substance satisfactory to the Authority’s counsel, from the Borrower or other credit-worthy source acceptable to the Authority. (h) The Authority receives such documents, legal opinions, certificates and other proceedings as are necessary and advisable to evidence compliance by the Borrower, the Underwriter and other financing participants with the Authority’s policies and procedures and applicable federal and State laws. 5 (i) The Borrower makes arrangements satisfactory to the Authority as to the payment of the Authority’s administrative fee. (j) The legal opinions, certificates, documents and other proceedings are in all material respects satisfactory to the Authority’s counsel. Section 6. Authority Documents; Authority’s Signatures; Additional Documents. The forms, terms, and provisions of each of the Documents, in the forms of such Documents (including the exhibits thereto) presented to this meeting, are hereby approved, with such insertions, deletions, and changes as are approved by the officers authorized to execute the Documents (which approval will be conclusively established by their execution and/or delivery thereof). Upon satisfaction of the conditions set forth in Section 5 hereof, the Authority’s President, Vice President, Secretary/Treasurer and Executive Director (each an “Authorized Officer”) are each hereby authorized to execute and deliver each of the Documents and any and all additional agreements, certificates, documents and other instruments, in forms satisfactory to the Authority’s legal counsel, to carry out the purposes and intent of this Resolution or relating to the issuance of the Bonds, including a tax certificate or tax certificates and any and all documents required under the Code or the Act, or, with respect to any of the Documents not calling for execution by the Authority, to deliver such Documents, with respect to any one or more series of the Bonds. From and after the execution and/or delivery of each of the Documents, the Authorized Officers, the agents and the employees of the Authority are hereby authorized, empowered and directed to do all such acts and things and to execute all such documents, certificates and assignments as may be necessary to carry out and comply with the provisions of each of the Documents (as executed and delivered), including from time to time, to execute, on behalf of the Authority any subsequent amendments, waivers or consents entered into or given in accordance with the Documents. Section 7. Sale of Bonds; Authentication. The sale of the Bonds pursuant to the terms and provisions of the Bond Purchase Agreement is hereby authorized and approved and each Authorized Officer is hereby authorized to execute and deliver the Bond Purchase Agreement. Any Authorized Officer is hereby authorized to execute and deliver to the Trustee a written order of the Authority for the authentication and delivery of the Bonds by the Trustee to the Underwriter. Section 8. Further Actions. The Authorized Officers, the agents and the employees of the Authority, upon satisfaction of the conditions set forth in Section 5 hereof, shall take all action necessary or reasonably required to carry out, give effect to and consummate the transactions contemplated hereby, including without limitation, the execution and delivery of the closing and other documents required to be delivered in connection with the issuance, sale and delivery of the Bonds. Section 9. Amendment to Preliminary Approval Resolution. The Authority hereby determines that the Preliminary Approval Resolution is amended such that all references to the “Applicant” contained therein refer to “Marbella Ranch AH II, LLLP.” Except as expressly amended hereby, the Preliminary Approval Resolution is hereby affirmed and remains in full force and effect. Section 10. Open Meeting Laws. It is found and determined that all formal actions of the Authority and its Board of Directors concerning and relating to the adoption of this Resolution 6 were adopted in an open meeting and that all deliberations that resulted in those formal actions were in meetings open to the public, in compliance with all legal requirements of the State and the Authority. Section 11. Public Hearing. All actions of the Authority heretofore taken or to be taken, in consultation with and at the direction of the Borrower and Bond Counsel, regarding a public hearing on the plan of financing the “project” and the proposed issuance of the Bonds, as required by Section 147(f) of the Code, and the publication of a public notice of the hearing in such form as provided by the Borrower and Bond Counsel, are hereby ratified and approved. Section 12. Irrepealability. After the Bonds are delivered by the Authority to the Underwriter upon receipt of payment therefor, this Resolution shall be and remain irrepealable until the Bonds and interest thereon shall have been fully paid, canceled, and discharged. Section 13. No Personal Liability. The Authorized Officers, members of the Board of Directors and any employee or agent of the Authority shall not be subject to any personal liability or accountability by reason of the issuance of the Bonds. The liability of the Authority with respect to the Documents, or any other document executed in connection with the transactions contemplated hereby, shall be limited as provided in the Act and the Documents. Section 14. Severability. If any section, paragraph, clause, or provision of this Resolution shall, for any reason, be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, clause, or provision shall not affect any of the remaining provisions of this Resolution. Section 15. Waiver. Any provisions of the Authority’s Bylaws, procedural guidelines, or prior resolutions inconsistent herewith are waived to the extent only of such inconsistency. This waiver shall not be construed as repealing any such Bylaws, procedural guidelines, or resolution or any part thereof. Section 16. Headings. Subject headings included in this Resolution are included for purpose of convenience only and shall not affect the construction or interpretation of any of its provisions. Section 17. Notice. Notice of Arizona Revised Statutes Section 38-511 is hereby given. The provisions of that statute by this reference are incorporated herein to the extent of applicability to matters contained herein under the laws of the State. Section 18. Resolution Not to be Construed as Providing Advice Concerning Municipal Securities. None of this Resolution, any of the Documents or any action taken by the Authority, any member of the Board of Directors, the Executive Director or the Authority’s employees or legal counsel in connection with issuance of the Bonds is intended to provide, and shall not be construed as providing, advice of any kind to Real Estate Equities, LLC or the Borrower with respect to the issuance of the Bonds for purposes of 15 United States Code Section 78o-4(e)(4)(A)(i). The Authority is a conduit issuer and none of the Authorized Officers, the Board of Directors, the Authority’s employees or legal counsel is acting or will act as a municipal advisor, financial advisor or fiduciary to any party involved in the issuance of the Bonds. 7 Section 19. Effective Date. This Resolution shall be effective immediately. [Signature page follows.]