MEETING DATE:
JULY 11, 2017
SUBJECT:
Title
RESOLUTION NO. SHA 2017-025 - APPROVAL OF A PROPERTY ACQUISITION LOAN TO RICHMAR STATION SAN MARCOS, LP (DEVELOPER) FOR A FUTURE AFFORDABLE HOUSING DEVELOPMENT IN THE RICHMAR NEIGHBORHOOD
Body
Recommendation
Recommendation
ADOPT a resolution approving a loan for a property acquisition in the amount of $721,500.
Body
Board or Commission Action
City Council as SHA approval of Exclusive Negotiating Agreement (ENA) and predevelopment loan on September 9, 2014 City Council as SHA approval of Supplemental Housing Support Agreement on December 9, 2014 City Council as SHA approval of Development and Loan Agreement, Section 33433 Report and property transfer on August 11, 2015
Relevant Council Strategic Theme
Planning for the Future
Relevant Department Goal
Facilitate Affordable Housing Production
Introduction
One of the City’s objectives has been the completion of the revitalization of the Richmar neighborhood, including the area between Mission Road and Richmar Avenue eastward to Firebird Lane. To that end, on September 9, 2014 the City Council as SHA approved an ENA and a related predevelopment loan of $392,500 for the Richmar Station mixed-use affordable housing development. On August 11, 2015 the SHA approved a Development and Loan Agreement, Section 33433 Report, and transfer of the SHA-owned property known as “4-Way Liquor” to the Developer for a loan of $2,227,870 inclusive of the property value, relocation, demolition and associated soft costs.
Discussion
From the beginning, the Developer planned to include the property at 311 Pleasant Way (APN 220-084-10) in the project. This property is under private ownership and consists of one 0.12 acre parcel, APN 220-084-10, containing a small commercial building and one single-family home. Purchase of this property will allow the Developer to continue orderly property assembly for the affordable housing project. This property acquisition will be the second step in a multi-phased property assembly process. Final property assembly for the entire project could take several years.
Included in the attached resolution is the approval of an additional loan from the City as the SHA for $721,500; $704,000 is for property acquisition and an additional $17,500 is for associated soft costs. The $721,500 represents the actual out-of-pocket cash loan that is being requested from the SHA. The money will be pulled from the 2016 SERAF reimbursement. Sufficient money remains from this reimbursement to fully fund this amount.
Fiscal Impact
Fiscal impact is up to $721,500 from the SHA account. The current remaining balance in the 2016 SERAF reimbursement allows for this without draining money from other SHA sources. The entire $721,500 represents a one-time out-of-pocket fiscal impact for this singular acquisition event.
Attachment(s)
1. Resolution No. SHA 2017 - XXX
2. GIS Exhibit depicting the potential project site, including the property at 311 Pleasant Way
Prepared by: Harry Williams, Housing Programs Manager
Submitted by: Dahvia Lynch, Director, Development Services Department
Approved by: Jack Griffin, City Manager