Exhibit A
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Recording Requested By and
When Recorded Mail To:
Anaheim Housing Authority )
200 South Anaheim Boulevard )
Anaheim, California 92805 )
Attention: Authority Secretary/City Clerk )
SPACE ABOVE THIS LINE FOR RECORDER
(This document is exempt from the payment of a
recording fee per Govt Code Section 27383.)
HV III GROUND LEASE OPTION AGREEMENT
This HV III GROUND LEASE OPTION AGREEMENT (“Lease Option Agreement”), dated, for identification purposes only, as of August 12, 2025 (“Effective Date”), is entered into by and between the ANAHEIM HOUSING AUTHORITY, a public body, corporate and politic ( “Authority”), and HERMOSA VILLAGE PHASE III HOUSING PARTNERS, L.P. a California limited partnership (“Developer”). Authority and Developer collectively constitute the “Parties”, with each being a “Party.”
RECITALS
The following recitals are a substantive part of this Agreement:
A. Authority is a housing authority duly established and operating as a local housing authority under the California Housing Authorities Law, Part 2 of Division 24, Section 34200, et seq., of the Health and Safety Code ( “HAL”), and has been authorized to transact business and exercise the power of a California housing authority pursuant to action of the City Council of the City of Anaheim (“City Council”).
B. Authority and Developer have negotiated the terms and conditions of and entered into that certain Preliminary Award Letter dated August 12, 2025, which is incorporated herein by reference ( “Award Letter ”) to pursue various activities toward the Resyndication, Substantial Rehabilitation, financing, and continued operation of an existing 112-unit affordable rental housing development as described with greater particularity within the Award Letter.
C. The Parties have made substantial progress in moving forward with the consummation of those activities described in the Award Letter. Based upon such progress, as well as the continued interest of each Party in moving forward with those undertakings for the respective Parties as set forth in the Award Letter, the Parties desire at this time to further formalize arrangements for additional activities in implementation of the Award Letter , including a commitment by Authority to enter into a ground lease with Developer for certain real property referred to as the HV III Properties (excluding the Bern Properties) in the Award Letter and as legally described in Exhibit A, attached and incorporated herein, subject to the
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Award Letter Condition Precedent and the satisfaction of certain other conditions precedent as more fully set forth in this Lease Option Agreement.
D. The parties acknowledge the following: the HV III Properties (exclusive of the Bern Properties as defined and described in the Award Letter) are currently ground leased by the Authority to Anaheim Revitalization III Partners, L.P. and Anaheim Revitalization IV Partners, L.P, each a California limited partnership (respectively, HV III Original Partnership, and HV IV Original Partnership, and together, “Original Partnership”) under the terms of (i) the HV III Original Ground Lease dated as of February 10, 2006 for the original HV III Authority- owned properties, and (ii) the HV IV Original Ground Lease dated as of July 27, 2007, each entered into by and between the Authority, as Landlord, and respectively the HV III Original Partnership, as Tenant, and HV IV Original Partnership, as Tenant (together, “Authority III & IV Ground Leases”). The objective of the Parties under this Lease Option Agreement is to grant an option to ground lease to Developer (“Option”), which Option may be exercised by Developer under which Developer and Authority will enter into that certain HV III Ground Lease as described in the Award Letter.
E. This Lease Option Agreement is in the vital and best interest of the City of Anaheim, California, and the health, safety and welfare of its residents.
NOW, THEREFORE, for and in consideration of the mutual promises, covenants, and conditions herein contained, Authority and Developer agree as follows:
1. Capitalized Terms. Except to the extent expressly defined herein, capitalized terms shall have the meanings established under the Award Letter.
2. Grant of Option; Option Consideration. Authority, as optionor, grants to Developer, as optionee, the Option to lease the HV III Properties (exclusive of the Bern Properties) on the terms and conditions set forth in this Lease Option Agreement (including without limitation Section 3 hereof), as well as the terms set forth in the Award Letter that further describe in summary terms the conditions and provisions of the Ground Lease and Affordable Housing Agreement, as hereby referenced. The term of the Option shall commence on the Effective Date and shall continue until expiration of the Term as defined and set forth in the Award Letter (“Expiration Date”). As of the Expiration Date, this Lease Option Agreement and the Option shall automatically terminate without the need of any notice or documentation; upon such termination, neither Party shall have any further rights or obligations under this Lease Option Agreement.
(a) The Option may only be exercised subject to the Parties agreeing on a final form of ground lease (“HV III Ground Lease”) and subject to Developer having provided evidence satisfactory to Authority that Developer has obtained financing adequate to cause the resyndication and Substantial Rehabilitation of the existing 112 -unit affordable rental housing HV III Project on the HV III Properties (exclusive of the Bern Properties) acceptable to Authority, and which is financed in part using 4% Tax Credits and Bonds. (b) In consideration of the grant of Option, Developer shall pay to Authority the sum of One Hundred Dollars ($100.00) (“Option Consideration Amount”) within two (2) days after the Effective Date. The Option Consideration Amount shall be retained by Authority as its sole property.
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3. Form of Ground Lease. The form of HV III Ground Lease by which Authority expects to provide a transfer of ground leasehold interest in the HV III Properties (exclusive of the Bern Properties) to Developer will be substantially in the form customarily utilized by Authority in comparable affordable rental housing transactions subject to laws and regulations and commercially reasonable market conditions at such time as evaluated by Authority when the Parties are negotiating and entering into the ground lease (“Form of HV III Ground Lease”).
The Form of HV III Ground Lease will include various terms, including without limitation with respect to construction, insurance, indemnity, criteria for selection of tenants, income limits, what constitutes Affordable Rent , reporting requirements, property management, maintenance standards , and scope of supportive social services to the residents . It is contemplated that the final form of HV III Ground Lease will include the final terms of financing and development of the HV III Project, consistent with the Award Letter.
4. Conditions to Closing; Closing of Financing. The obligation of Authority to execute and deliver possession of the HV III Properties (exclusive of the Bern Properties that will be the subject of separate ground lease(s) with the third party owner ) pursuant to the Option of Developer to ground lease the HV III Properties (exclusive of the Bern Properties) shall be subject to conditions customarily and normally applied by Authority in connection with affordable housing transactions which utilize ground leases such as: a delineation of improvements, including the Substantial Rehabilitation, required in detail satisfactory to Authority; requirements that evidence of financing, reasonably satisfactory to the Executive Director of the Authority, be in place; and requirements that a title insurer acceptable to Authority and Developer be prepared to insure leasehold title to the Authority-ground leased HV III Properties, including all portions thereof, subject only to encumbrances which do not render leasehold title unmerchantable (and exclusive of the Bern Properties that will be the subject of separate ground lease(s).) Further, the Award Letter describes in summary term the conditions and provisions of the Ground Lease and Affordable Housing Agreement, as hereby referenced. The Parties acknowledge that certain steps will be needed in order for the condition of title of those certain HV III Properties (exclusive of the Bern Properties) so that each of the parties have good, marketable title, with Developer holding the ground leasehold interest and Authority holding the underlying fee interest , and agree to take commercially reasonable actions necessary and appropriate in order to accomplish such a result.
5. Activities of Executive Director. The Executive Director is authorized and directed to take such actions as he shall deem necessary or convenient to implement the disposition of a ground leasehold interest in the HV III Properties as provided above (and exclusive of the Bern Properties that will be the subject of separate ground lease(s)) , and as generally described in the Award Letter.
6. Reaffirmation. Each of the Parties reaffirms its desire to proceed with implementation of those respective responsibilities and activities and further described in the Award Letter.
7. No Third Party Beneficiaries. This Lease Option Agreement is made for the purpose of setting forth rights and obligations of Authority and Developer, and no other person shall have any rights hereunder or by reason hereof. Excepting the City of Anaheim, a California municipal corporation and charter city, there shall be no third party beneficiaries of the Award Letter or this Lease Option Agreement.
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8. Effectiveness. This Lease Option Agreement shall be effective as of the Effective Date and shall remain in effect until the Expiration Date.
9. Interpretation. This Lease Option Agreement shall be interpreted to effectuate the terms of the Award Letter as modified hereby, in accordance with the laws of the State of California, and as if prepared and reviewed equally by the Parties. This Lease Option Agreement may be executed in counterparts.
IN WITNESS WHEREOF, the Parties hereto have caused this Lease Option Agreement to be executed as of the Effective Date.
(signatures on following pages)
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DEVELOPER:
HERMOSA VILLAGE PHASE III HOUSING
PARTNERS, L.P.,
a California limited partnership
By: Related/Hermosa Village Phase III Development
Co., LLC, a California limited liability company,
Its administrative general partner
By:
Frank Cardone, President
(Ground Lease Option Agreement signatures continue on following page)
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(Ground Lease Option Agreement signatures continued from previous page)
AUTHORITY:
ANAHEIM HOUSING AUTHORITY, a public
body, corporate and politic
By:
Grace Ruiz-Stepter, Executive Director
or Authorized Designee
ATTEST:
THERESA BASS, AUTHORITY SECRETARY
Theresa Bass or Authorized Designee
APPROVED AS TO FORM:
OFFICE OF THE CITY ATTORNEY
Ryan O. Hodge, Deputy City Attorney IV
or Authorized Designee
STRADLING YOCCA CARLSON & RAUTH
Authority Special Counsel
Order Number: NHSC-7208848
Page Number: 7
First American Title
EXHIBIT A
LEGAL DESCRIPTION OF THE HV III PROPERTIES (EXCLUDING THE BERN PROPERTIES) (Phase III)
Real property in the City of Anaheim, County of Orange, State of California, described as follows: Parcel A:
Parcel 1:
Lot 5 of Tract No. 1647, as shown on a map recorded in Book 87, Pages 10 to 13 inclusive of Miscellaneous Maps, together with Parcel 1 of Lot Line Adjustment No. LLA-581 recorded May 24, 2006 as Instrument No. 2006000347363, Official Records, records of Orange County, California, described as follows:
Beginning at the Northeast corner of said Lot 5; thence, along the Easterly line of said Lot 5, South 00° 44' 07" West 100.00' to the Southeast corner of said Lot 5; thence, along the Southerly line of said Lot 5 and Southerly line of said Parcel 1 of Lot Line Adjustment No. LLA -581, North 89° 15' 53" West 216.00 feet to the Southwest corner of said Parcel 1; thence, along the Westerly line of said Parcel 1, North 00° 44' 07" East 100.00 feet to the Northwest corner of Parcel 1; thence, along the Northerly line of said Parcel 1 and Northerly line of said Lot 5, South 89° 15' 53" East 216.00 feet to the Point of Beginning.
Except therefrom all oil, gas, minerals and kindred substances below a depth of 500 feet, but without the right of surface entry.
Also except therefrom all underground waters lying beneath said land, but without the right of surface entry, as granted to Dyke Water Company in an Instrument recorded July 01, 1955 in Book 3126, Page 285 of Official Records.
Parcel 2:
A non-exclusive easement for private right-of-way as conveyed to the record owners by deed recorded July 28, 2004 as Instrument No. 2004000686108 of Official Records.
Parcel 3:
A non-exclusive easement for private right-of-way as reserved to the owners of the property, by deed recorded September 2, 2004 as Instrument No. 2004000798070 of Official Records.
Parcel B:
Parcel 1:
Lot 56 of Tract No. 3278, in the City of Anaheim, County of Orange, State of California, as per map recorded in Book 104, Pages 8 through 10, inclusive of Miscellaneous Maps, in the office of the County Recorder of said county.
Parcel 2:
A non-exclusive easement for private right-of-way as conveyed to the record owners by deed recorded July 28, 2004 as Instrument No. 2004000686108 of Official Records.
Parcel 3:
A non-exclusive easement for private right-of-way as reserved to the owners of the property, by deed Order Number: NHSC-7208848
Page Number: 8
First American Title
recorded September 2, 2004 as Instrument No. 2004000798070 of Official Records. Parcel C:
Parcel 1:
Lots 22 and 23 of Tract No. 3301, in the City of Anaheim, County of Orange, State of California, as per map recorded in Book 104, Pages 32 and 33, Miscellaneous Maps, records of said county, described as follows:
Beginning at the Northeast corner of said Lot 22, said point being on a non-tangent curve concave Northwesterly, having a radius of 1562.50 feet, a radial line to said beginning bears South 87° 57' 00" East; thence, Southwesterly 160.79 feet along said non -tangent curve and Easterly lines of said Lots 22 and 23 through a central angle of 05° 53' 45" to the Southeast corner of said Lot 23; thence, along the Southerly line of said Lot 23, being a non -tangent line, North 79° 41' 30" West 102.59 feet to the Sou thwest corner of said Lot 23 and beginning of a non -tangent curve concave Northwesterly having a radius of 1460.00 feet, a radial line to said beginning bears South 82° 13' 45" East; thence, Northeasterly 129.16 feet, along said non-tangent curve and Westerly lines of said Lots 22 and 23 through a central angle of 05° 04' 08" to the beginning of a reverse curve concave to the Southeast having a radius of
15.00 feet, a radial line to said beginning bears North 87° 17' 53" West; thence, Northeasterly 23.05 feet along said reverse curve through a central angle of 88° 02' 00" to the Northerly line of said Lot 22; thence, along said Northerly line, South 89° 15' 53" East 87.96 feet to the Point of Beginning.
The land described above is shown in Lot Line Adjustment No. LLA-0000603 recorded February 17, 2006 as Instrument No. 2006000112730, Official Records.
Parcel 2:
An easement for driveway purposes over that portion of Lots 23 and 24 in said Tract No. 3301 included within a strip of land 25.00 feet in width, the North line of which is described as follows:
Beginning at a point in the West line said Lot 23 distant North 6.10 feet from the Southwest corner thereof thence East to a point in the East line of said lot distant North 9.80 feet from the Southeast corner of said lot.
Excepting therefrom the Westerly 19.00 feet thereof.
Also excepting therefrom that portion included within Parcel 1 hereinbefore described. Parcel 3:
A non-exclusive easement for private right-of-way as conveyed to the record owners by deed recorded July 28, 2004 as Instrument No. 2004000686108 of Official Records.
Parcel 4:
A non-exclusive easement for private right-of-way as reserved to the owners of the property, by deed recorded September 2, 2004 as Instrument No. 2004000798070 of Official Records.
Parcel: D
Parcel 1:
Order Number: NHSC-7208848
Page Number: 9
First American Title
Lot 17 of Tract No. 3301, as per map recorded in Book 104, Pages 32 and 33 of Miscellaneous Maps, in the office of the County Recorder of said county.
Parcel 2:
A non-exclusive easement for private right-of-way as conveyed to the record owners by deed recorded July 28, 2004 as Instrument No. 2004000686108 of Official Records.
Parcel 3:
A non-exclusive easement for private right-of-way as reserved to the owners of the property, by deed recorded September 2, 2004 as Instrument No. 2004000798070 of Official Records.
Parcel E:
Parcel 1:
Lot 19 of Tract No. 3301, as per map recorded in Book 104, Pages 32 and 33 of Miscellaneous Maps, in the office of the County Recorder of said county.
Excepting therefrom all oil, gas, minerals and hydrocarbon substances in and under said land, but without the right of surface entry, as reserved in deed recorded in Book 3126, Page 285 of Official Records of said Orange County.
Parcel 2:
A non-exclusive easement for private right-of-way as conveyed to the record owners by deed recorded July 28, 2004 as Instrument No. 2004000686108 of Official Records.
Parcel 3: A non-exclusive easement for private right-of-way as reserved to the owners of the property, by deed recorded September 2, 2004 as Instrument No. 2004000798070 of Official Records.
Parcel F:
Parcel 1:
Lot 14 of Tract No. 3301, as shown on a map recorded in Book 104, Pages 32 and 33 of Miscellaneous Maps, records of Orange County, California.
Parcel 2:
A non-exclusive easement for private right-of-way as conveyed to the record owners by deed recorded July 28, 2004 as Instrument No. 2004000686108 of Official Records.
Parcel 3:
A non-exclusive easement for private right-of-way as reserved to the owners of the property, by deed recorded September 2, 2004 as Instrument No. 2004000798070 of Official Records.
Parcel G:
Lot 7 of Tract No. 3301, in the City of Anaheim, County of Orange, State of California, as per map recorded in Book 104, Pages 32 and 33 inclusive, Miscellaneous Maps, in the office of the County Exhibit C
Legal Description of HV III Properties
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Recorder of said county.
Excepting therefrom all underground water lying beneath said land, but without the right of surface entry thereon, as granted to Dyke Water Company, a California corporation, in deed recorded in Book 3126, Page 285 of Official Records.
Parcel H:
Lot 5 of Tract No. 3301, in the City of Anaheim, County of Orange, State of California, as per map recorded in Book 104, Pages 32 and 33 of Miscellaneous Maps, in the office of the County Recorder of said county.
Parcel I:
Lot 4 of Tract 3301 as per map recorded in Book 104 Pages 32 and 33 of Mapsin the office of the County Recorder of Orange County, State of California
Parcel J:
Lots 20 and 21 of Tract No. 3278, as shown on a map recorded in Book 104, Pages 8, 9 and 10 of miscellaneous records of Orange County, California.
Excepting therefrom all underground waters lying beneath said land, but without the right of entry to the surface for the purpose of producing same, as deeded to Dyke Water Company, a corporation, by deed recorded July 1, 1955 in Book 3126, Page 285 of Official Records.
APN: 129-331-25 (Parcel A and other
property) 129-341-05 (Parcel B)
129-343-31 (Parcel C)
129-343-05 (Parcel D)
129-342-10 (Parcel G)
129-342-12 (Parcel H)
129-343-03 (Parcel E)
129-342-13 (Parcel I)
129-332-13 (Lot 21 of Parcel J)
129-332-14 (Lot 20 of Parcel J)
129-343-08 (Parcel F)
Order Number: NHSC-7208848
Page Number: 11
First American Title
Order Number: NHSC-7208848
Page Number: 12
First American Title
LEGAL DESCRIPTION (Phase IV)
Real property in the City of Anaheim, County of Orange, State of California, described as follows: Parcel 1: (APN: 129-343-12)
Lot 10 of Tract No. 3301, in the City of Anaheim, County of Orange, State of California, as per map recorded in Book 104, Pages 32 and 33 inclusive, of miscellaneous maps, in the office of the County Recorder of said County.
Also excepting the subsurface water rights, but without the right of entry to the surface or the subsurface above a depth of 500 feet as dedicated on tree easement map of said tract.
Parcel 2: (APN(S): 129-342-04 [Lot 50] and 129-342-05 [Lot 49]) Lots 49 and 50 of Tract No. 3278 in the City of Anaheim, County of Orange, State of California, as per map recorded in Book 104, Pages 8, 9 and 10 of miscellaneous maps in the office of the County Recorder of said County.
Except the subsurface water rights but without the right of entry to the surface or the subsurface above a depth of 500 feet as dedicated on the map of said Tract.
Parcel 3: (APN(S): 129-331-12 [Lot 60] and 129-331-16 [Lot 64]) Lots 60 and 64 Tract No. 3278, as shown on a map recorded in Book 104, Pages 8, 9 and 10 of miscellaneous maps, records of Orange County, California.
Parcel 3A:
A non-exclusive easement for private right-of-way as conveyed to the record owners by deed recorded July 28, 2004 as Instrument No. 2004000686108 of Official Records.
Parcel 3B:
A non-exclusive easement for private right-of-way as reserved to the owners of the property, by deed recorded September 2, 2004 as Instrument No. 2004000798070 of Official Records.
Order Number: NHSC-7208848
Page Number: 13
First American Title
Jurat
4923-9569-5181v2/022620-0124
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
) ss.
COUNTY OF _______________________ )
On ___________________ before me, ____________________________________, Notary Public,
personally appeared _____________________________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal
SHV IIINATURE OF NOTARY PUBLIC
Jurat
4923-9569-5181v2/022620-0124
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
) ss.
COUNTY OF _______________________ )
On ___________________ before me, ____________________________________, Notary Public,
personally appeared _____________________________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal
SHV IIINATURE OF NOTARY PUBLIC