Regular Council Meeting
September 3, 2026
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207!)' ( .-·,·1 _ 1 f-") ,..,, , - u C ' ;, > I -·· .. , (I, -) •-· 1 '-• Supplement Packet
ITEM(S)
2.-1 (ID 26-1137)
Actions pertaining to the Blythe Village LP Loan Amendments for the Blythe Village project located at 3572 N. Blythe Avenue, 93722 in west central Fresno (District 1 ):
[TITLE TRUNCATED FOR SUPPLEMENTAL PACKET COVER PAGE]
Contents of Supplement: First Amendment to CDBG Agreement and Promissory Note, Second Amendment to HOME Agreement and Promissory Note
ltem(s)
Supplemental Information:
Any agenda related public documents received and distributed to a majority of the City Council after the Agenda Packet is printed are included in Supplemental Packets.
Supplemental Packets are produced as needed. The Supplemental Packet is available for public inspection in the City Clerk's Office, 2600 Fresno Street, during normal business hours (main location pursuant to the Brown Act, G.C. 54957.5(2). In addition, Supplemental Packets are available for public review at the City Council meeting in the City Council Chambers, 2600 Fresno Street Supplemental Packets are also available on-line on the City Clerk's website.
Americans with Disabilities Act (ADA):
The meeting room is accessible to the physically disabled, and the services of a translator can be made available. Requests for additional accommodations for the disabled, sign language interpreters, assistive listening devices, or translators should be made one week prior to the meeting. Please call City Clerk's Office at 621-7650. Please keep the doorways, aisles and wheelchair seating areas open and accessible. If you need assistance with seating because of a disability, please see Security.
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Recorded at the Request of
and When Recorded Return to:
City of Fresno
City Clerk’s Office
2600 Fresno Street, Room 2133
Fresno, CA 93721-3603
(SPACE ABOVE THIS LINE FOR RECORDER’S USE ONLY)
This First Amendment to City of Fresno Community Development Block Grant Agreement is recorded at the request and for the benefit of the City of Fresno and is exempt from the payment of a recording fee pursuant to Government Code Section 6103
CITY OF FRESNO
By:
Georgeanne A. White
City Manager
Date:
FIRST AMENDMENT TO CITY OF FRESNO
COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
AGREEMENT
by and between
CITY OF FRESNO,
a municipal corporation
and
Blythe Village LP,
a Limited Partnership
regarding
Blythe Village – Property Acquisition
3572 N. Blythe Avenue, Fresno, CA 93722
APN: 511-250-02
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FIRST AMENDMENT TO CITY OF FRESNO
COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM AGREEMENT
This First Amendment to City of Fresno Community Development Block Grant Program Agreement (Amendment) is entered into on , 2026, by and between the City of Fresno, a municipal
corporation, acting through its Planning and Development Department – Housing and Community Development Division (CITY), and Blythe Village LP, a California limited partnership (DEVELOPER).
RECITALS
A. WHEREAS, the CITY and DEVELOPER entered into a (i) Community Development Block Grant (CDBG) Program Agreement dated May 2, 2024, and recorded on June 13, 2024, as instrument number 2024-0052229 in the official records of the Fresno County Recorder’s Office (Exhibit “A”), (ii) Declaration of Restrictions dated June 3, 2024, and recorded on June 13, 2024, as instrument number 2024-0052231 in the official records of the Fresno County Recorder’s Office ( Exhibit “B”), (iii) Deed of Trust dated June 3, 2024, and recorded on June 13, 2024, as instrument number 2024-0052230 in the official records of the Fresno County Recorder’s Office ( Exhibit “C”), and (iv) Promissory Note dated June 3, 2024, in the amount of $400,000 (Exhibit “D”) (collectively the CDBG Loan Documents); and
B. WHEREAS, the CITY and Developer wish to amend the language in the CDBG Agreement, Article 2. TERM OF THE CDBG LOAN, Section 2.7 - Subordination to allow for the DEVELOPER to convert to permanent financing at $15,000,000 to pay off the construction loan, refinancing cost, deferred developer fee with accrued interest, construction management and administration costs, and equity capital investment; and
C. WHEREAS, the Promissory Note provides for repayment of the above-mentioned costs from residual receipts; therefore, the Promissory Note (Exhibit “E”) is amended to eliminate those same costs to be paid from future residual receipts; and
D. WHEREAS, an independent third-party appraisal of the Blythe Village property determined a valuation in excess of the combined sum of the $15,000,000 permanent senior financing, the $2,600,000 HOME Promissory Note dated July 25, 2024, and the $400,000 CDBG Promissory Note dated June 3, 2024, demonstrating that sufficient equity exists in the property to fully secure the City’s subordinate HOME and CDBG loans in addition to the senior debt;
WHEREAS, the Fresno City Council approved this First Amendment on September 3, 2026.
NOW THEREFORE, in consideration of the above recitals, which recitals are contractual in nature, the mutual promises herein contained, and for other good and valuable consideration hereby acknowledged, the parties agree to the following:
1. Pursuant to this First Amendment to the City of Fresno CDBG Agreement, Article 2. TERM OF THE CDBG LOAN, Section 2.7 - Subordination is amended to read as follows:
This Agreement, the Declaration of Restrictions and the Deed of Trust may be subordinated to certain approved financing (in each case, a "Senior Lender''), to no worse than3rd position, but only on condition that all of the following conditions are satisfied: (a) all of the proceeds of the proposed Senior Loan, less any transaction costs, must be used to provide construction financing, permanent financing to pay off the construction loan,
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refinancing costs, deferred developer fee with accrued interest, construction management and administration costs, and equity capital investment for the Project consistent with an approved financing plan; (b) the subordination agreement must provide the CITY with adequate rights to cure any defaults by the DEVELOPER including providing the CITY or its successor with copies of any notices of default; (c) upon a determination by the City Manager that the conditions in this Section have been satisfied, the City Manager or his/her designee will be authorized to execute the approved subordination agreement, inter-creditor agreements, standstill agreements, and/or other documents as may be reasonably requested by the Lender to evidence subordination to the Project financing, without the necessity of any further action or approval provided that such agreements contain written provisions that are no more onerous and which are consistent with the customary standard requirements imposed by the financing source(s), on subordinate cash flow obligations under their then existing senior financing policies, and further provided that the City Attorney approves such document(s) as to form.
2. The original CDBG Promissory Note is being amended to eliminate duplicate repayment of the construction loan, refinancing costs, deferred developer fee with accrued interest, construction management and administration costs, and equity capital investment.
3. In the event of any conflict between the body of this First Amendment, and any exhibit or attachments hereto, the terms and conditions of the body of the First Amendment shall control and take precedence over the exhibit/attachment.
4. All capitalized terms used in the First Amendment, unless otherwise defined herein, shall have the same meanings assigned to such terms in the CDBG Agreement and Promissory Note.
5. Except as expressly modified and amended hereby, the CDBG Agreement shall remain in full force and effect. From and after the effective date of this First Amendment references in the CDBG Agreement to this “First Amendment” shall mean the CDBG Agreement as hereby amended.
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EXHIBIT “A”
CDBG AGREEMENT
EXHIBIT “B”
DECLARATION OF RESTRICTIONS
EXHIBIT “C”
DEED OF TRUST
EXHIBIT “D”
PROMISSORY NOTE
EXHIBIT “E”
FIRST AMENDMENT TO PROMISSORY NOTE
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FIRST AMENDMENT TO PROMISSORY NOTE
Secured by Deed of Trust
THIS FIRST AMENDMENT TO PROMISSORY NOTE (Amendment) BETWEEN THE CITY OF FRESNO (LENDER) and BLYTHE VILLAGE LP, (BORROWER) made and entered into as of this _____ day of September 2026, amends that certain Promissory Note dated June 3, 2024, between BORROWER and LENDER in the amount of $400,000.00.
RECITALS
A. LENDER provided funding in the amount of $400,000.00 in the form of a loan to BORROWER pursuant to a COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) Agreement which was recorded in the Recorder’s Office of Fresno County on June 13, 2024, as Document No. 2024-0052229;
B. LENDER and BORROWER executed a Promissory Note (Note) on June 3, 2024; C. LENDER and BORROWER now desire to modify certain terms of the Promissory Note as set forth herein;
D. The Note, as amended, shall remain secured by the Deed of Trust dated June 3, 2024, and recorded in the Recorder’s Office of Fresno County on June 13, 2024, as Instrument Number 2024-0052230 against that certain real property located at 3572 N. Blythe Avenue in the City of Fresno. The real property described above, which is security for the obligations hereunder, remains subject to the Declaration of Restrictions dated June 3, 2024, and recorded in the Recorder’s Office of Fresno County on June 13, 2024, as Instrument Number 2024-0052231.
NOW, THEREFORE, in consideration of the above recitals, which recitals are contractual in nature, the mutual premises herein contained, and for other good and valuable consideration hereby acknowledged, LENDER and BORROWER now desire to modify the Note as follows:
AMENDMENTS
1. The third paragraph entitled Residual Receipts is amended to read as follows:
Residual Receipts means in each operating year one hundred percent (100%) of the sum of: (i) all cash received by the Project from rents, lease payments, and all sources generally considered in the apartment industry to be “other income” (which does not include payments for optional services provided by the BORROWER), (ii) payments from HUD under a Housing Assistance Program Section 8 Contract to the Project, if any, and excluding tenant security or other deposits required by law to be segregated and restricted, and interest on reserves not available for distribution, and the net proceeds of any insurance (including rental interruption insurance), other than fire and extended coverage and title insurance, to the extent not reinvested, less the sum of:
(i) all payments on account of any debt, preferred equity or equity financing (including unpaid principal and accrued reasonable interest) made for the benefit of the Project by the Borrowers, (ii) contributions to any prudent and reasonable cash reserves for working capital, operating expenses, capital expenditures, repairs, replacements and
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anticipated expenditures, in such amounts as may be reasonably required by the lenders to the Project for the operation of the Project not to exceed the amount required by the Project’s permanent lender, annually adjusted in proportion to the average increase of the following indices (a) the United States Bureau of Labor Statistics for Hourly Wage Rates of all workers in manufacturing, and (b) of all Commodity Wholesale Prices, said indices shall be re-defined to the mutual satisfaction of the parties in the event of change in form and basis of indices, all increases shall use the indices for calendar year 2010 as their base; and (iii) the payment of principal and interest, and any associated fees, expenses, and costs, with respect to the Project financing, and Project related debt preferred equity or equity financing sources.
Notwithstanding the foregoing definition, Residual receipts shall not include the following:
$9.5 million construction loan;
$861,782 developer fee;
$355,000 construction management and administrative fee; $274,337 refinancing costs and reserves; or
$4,008,880 capital equity investment.
2. The fourth paragraph entitled Operating Expenses is deleted in its entirety and replaced with the following:
Operating Expenses means actual, reasonable and customary (for comparable quality, newly constructed rental housing developments in Fresno County) costs, fees and expenses directly incurred, paid, and attributable to the operation, maintenance and management of the Affordable Project in a calendar year, including, without limitation:
painting, cleaning, repairs, alterations, landscaping, utilities, refuse removal, certificates, permits and licenses, sewer charges, real and personal property taxes, assessments, insurance, security, advertising and promotion, janitorial services, cleaning and building supplies, purchase, repair, servicing and installation of appliances, equipment, fixtures and furnishings which are not paid from the capital replacement reserve, fees and expenses of property management and common area expenses, fees and expenses of accountants, attorneys and other professionals, the cost of social services, repayment of any completion or operating loans including any and all deferred fees per the Budget, made to the BORROWER , its successors or assigns, Asset Management Fee, GP Asset Management Fee, and other actual operating costs and capital costs which are incurred and paid by the BORROWER, but which are not paid from reserve accounts.
3. Except as amended hereby, all other terms and conditions of the Note shall remain in full force and effect.
[Signatures follow on next page]
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Recorded at the Request of
and When Recorded Return to:
City of Fresno
City Clerk’s Office
2600 Fresno Street, Room 2133
Fresno, CA 93721-3603
(SPACE ABOVE THIS LINE FOR RECORDER’S USE ONLY)
This Second Amendment to City of Fresno HOME Investment Partnership Program is recorded at the request and for the benefit of the City of Fresno and is exempt from the payment of a recording fee pursuant to Government Code Section 6103
CITY OF FRESNO
By:
Georgeanne A. White
City Manager
Date:
SECOND AMENDMENT TO CITY OF FRESNO
HOME INVESTMENT PARTNERSHIPS PROGRAM
AGREEMENT
by and between
CITY OF FRESNO,
a municipal corporation
and
Blythe Village LP
regarding
Blythe Village
3572 N. Blythe Avenue, Fresno, CA 93722
APN: 511-250-02
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SECOND AMENDMENT TO CITY OF FRESNO
HOME INVESTMENT PARTNERSHIPS PROGRAM AGREEMENT
This Second Amendment to City of Fresno HOME Investment Partnerships Program Agreement (Amendment) is entered into on _____, 2026, by and between the City of Fresno, a municipal corporation, acting through its Planning and Development Department - Housing and Community Development Division (CITY), and Blythe Village LP (DEVELOPER).
RECITALS
A. WHEREAS, the CITY and DEVELOPER entered into (i) a HOME Investment Partnerships (HOME) Program Agreement dated June 3, 2024, and recorded on June 13, 2024, as instrument number 2024-0052232 in the official records of the Fresno County Recorder’s Office (Exhibit “A”), (ii) Declaration of Restrictions dated June 3, 2024, and recorded on June 13, 2024, as instrument number 2024-0052234 in the official records of the Fresno County Recorder’s Office (Exhibit “B”), (iii) Deed of Trust with Assignment of Rents dated June 2, 2024, and recorded on June 13, 2024, as instrument number 2024-0052233 in the official records of the Fresno County Recorder’s Office (Exhibit “C”), (iv) Promissory Note dated June 3, 2024, in the amount of $1,800,000 ( Exhibit “D”), (v) First Amendment to City of Fresno HOME Agreement dated July 25, 2024, and recorded on August 15, 2024, as instrument number 2024-0073627 in the official records of the Fresno County Recorder’s Office (Exhibit “E”), and (vi) First Amendment to Promissory Note dated July 25, 2024, in the amount of $2,600,000 (Exhibit “F”) (collectively the HOME Loan Documents); and B. WHEREAS, the CITY and Developer wish to amend the language in the HOME Agreement, Article 2. TERM OF THE HOME LOAN, Section 2.7 - Subordination to allow for the DEVELOPER to convert to permanent financing at $15,000,000, to pay off the construction loan, refinancing cost, deferred developer fee with accrued interest, construction management and administration costs, and equity capital investment; and
C. WHEREAS, the Promissory Note and First Amendment to the Promissory Note provide for repayment of the above-mentioned costs from residual receipts; therefore, the Promissory Note is amended a second time ( Exhibit “G”) to eliminate those same costs to be paid from future residual receipts; and
D. WHEREAS, an independent third-party appraisal of the Blythe Village property determined a valuation in excess of the combined sum of the $15,000,000 permanent senior financing, the $2,600,000 HOME Promissory Note dated July 25, 2024, and the $400,000 CDBG Promissory Note dated June 3, 2024, demonstrating that sufficient equity exists in the property to fully secure the City's subordinate HOME and CDBG loans in addition to the senior debt; E. WHEREAS, the Fresno City Council approved this Second Amendment on September 3, 2026.
NOW THEREFORE, in consideration of the above recitals, which recitals are contractual in nature, the mutual promises herein contained, and for other good and valuable consideration hereby acknowledged, the parties agree to the following:
1. Pursuant to this Second Amendment to the City of Fresno HOME Agreement, Article 2. TERM OF THE HOME LOAN, Section 2.7 - Subordination is replaced in its entirety to read as follows:
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This Agreement, the Declaration of Restrictions and the Deed of Trust may be subordinated to certain approved financing (in each case, a "Senior Lender''), to no worse than 4th position, but only on condition that all of the following conditions are satisfied: (a) all of the proceeds of the proposed Senior Loan, less any transaction costs, must be used to provide construction financing, permanent financing to pay off the construction loan, refinancing costs, deferred developer fee with accrued interest, construction management and administration costs, and equity capital investment for the Project consistent with an approved financing plan; (b) the subordination agreement must provide the CITY with adequate rights to cure any defaults by the DEVELOPER including providing the CITY or its successor with copies of any notices of default; (c) upon a determination by the City Manager that the conditions in this Section have been satisfied, the City Manager or his/her designee will be authorized to execute the approved subordination agreement, inter-creditor agreements, standstill agreements, and/or other documents as may be reasonably requested by the Lender to evidence subordination to the Project financing, without the necessity of any further action or approval provided that such agreements contain written provisions that are no more onerous and which are consistent with the customary standard requirements imposed by the financing source(s), on subordinate cash flow obligations under their then existing senior financing policies, and further provided that the City Attorney approves such document(s) as to form.
2. The original HOME Promissory Note and First Amendment to the Promissory Note are amended a second time by the Second Amendment to Promissory Note attached hereto as Exhibit “G”, to eliminate duplicate repayment of the construction loan, refinancing costs, deferred developer fee with accrued interest, construction management and administration costs, and equity capital investment.
3. In the event of any conflict between the body of this Second Amendment, and any exhibit or attachments hereto, the terms and conditions of the body of the Second Amendment shall control and take precedence over the exhibit/attachment.
4. All capitalized terms used in the Second Amendment, unless otherwise defined herein, shall have the same meanings assigned to such terms in the HOME Agreement and Promissory Note.
5. Except as expressly modified and amended hereby, the HOME Agreement shall remain in full force and effect. From and after the effective date of this Second Amendment, references to the “HOME Agreement” shall mean the HOME Agreement as amended hereby.
[SIGNATURES FOLLOW ON NEXT PAGE]
EXHIBIT “A”
HOME AGREEMENT
EXHIBIT “B”
DECLARATION OF RESTRICTIONS
EXHIBIT “C”
DEED OF TRUST
EXHIBIT “D”
PROMISSORY NOTE
EXHIBIT “E”
FIRST AMENDMENT TO HOME AGREEMENT
EXHIBIT “F”
FIRST AMENDMENT TO PROMISSORY NOTE
EXHIBIT “G”
SECOND AMENDMENT TO PROMISSORY NOTE
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SECOND AMENDMENT TO PROMISSORY NOTE
Secured by Deed of Trust
THIS SECOND AMENDMENT TO PROMISSORY NOTE (Amendment) BETWEEN THE CITY OF FRESNO (LENDER) and BLYTHE VILLAGE LP, (BORROWER) made and entered into as of this _____ day of September 2026, amends that certain Promissory Note dated June 3, 2024, between BORROWER and LENDER in the amount of $1,800,000.00, as amended on July 25, 2024 , which increased the total loan amount to $2,600,000.00.
RECITALS
A. LENDER provided funding in the amount of $1,800,000.00 in the form of a loan to BORROWER pursuant to a HOME Investment Partnership Program Agreement which was recorded in the Recorder’s Office of Fresno County on June 13, 2024, as Document No. 2024-0052232;
B. LENDER and BORROWER executed a Promissory Note (Note) on June 3, 2024; C. LENDER and BORROWER executed a First Amendment to Promissory Note on July 25, 2024 , pursuant to which LENDER provided additional funding of $800,000.00, increasing the total loan amount to $2,600,000.00;
D. LENDER and BORROWER now desire to modify certain terms of the Promissory Note as set forth herein;
E. The Note, as amended, shall remain secured by the Deed of Trust dated June 2, 2024, and recorded in the Recorder’s Office of Fresno County on June 13, 2024, as Instrument Number 2024-0052233 against that certain real property located at 3572 N. Blythe Avenue in the City of Fresno. The real property described above, which is security for the obligations hereunder, remains subject to the Declaration of Restrictions dated June 3, 2024, and recorded in the Recorder’s Office of Fresno County on June 13, 2024, as Instrument Number 2024-0052234.
NOW, THEREFORE, in consideration of the above recitals, which recitals are contractual in nature, the mutual premises herein contained, and for other good and valuable consideration hereby acknowledged, LENDER and BORROWER now desire to modify the Note as follows:
AMENDMENTS
1. The third paragraph entitled Residual Receipts is amended to read as follows:
Residual Receipts means in each operating year one hundred percent (100%) of the sum of: (i) all cash received by the Project from rents, lease payments, and all sources generally considered in the apartment industry to be “other income” (which does not include payments for optional services provided by the BORROWER), (ii) payments from HUD under a Housing Assistance Program Section 8 Contract to the Project, if any, and excluding tenant security or other deposits required by law to be segregated and restricted, and interest on reserves not available for distribution, and the net proceeds of any insurance (including rental interruption insurance), other than fire and extended coverage and title insurance, to the extent not reinvested, less the sum of:
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(i) all payments on account of any debt, preferred equity or equity financing (including unpaid principal and accrued reasonable interest) made for the benefit of the Project by the BORROWER, (ii) contributions to any prudent and reasonable cash reserves for working capital, operating expenses, capital expenditures, repairs, replacements and anticipated expenditures, in such amounts as may be reasonably required by the lenders to the Project for the operation of the Project not to exceed the amount required by the Project’s permanent lender, annually adjusted in proportion to the average increase of the following indices (a) the United States Bureau of Labor Statistics for Hourly Wage Rates of all workers in manufacturing, and (b) of all Commodity Wholesale Prices, said indices shall be re-defined to the mutual satisfaction of the parties in the event of change in form and basis of indices, all increases shall use the indices for calendar year 2010 as their base; and (iii) the payment of principal and interest, and any associated fees, expenses, and costs, with respect to the Project financing, and Project related debt preferred equity or equity financing sources.Notwithstanding the foregoing definition, Residual receipts shall not include the following:
$9.5 million construction loan;
$861,782 developer fee;
$355,000 construction management and administrative fee; $274,337 refinancing costs and reserves; or
$4,008,880 capital equity investment.
2. The fourth paragraph entitled Operating Expenses is deleted in its entirety and replaced with the following:
Operating Expenses means actual, reasonable and customary (for comparable quality, newly constructed rental housing developments in Fresno County) costs, fees and expenses directly incurred, paid, and attributable to the operation, maintenance and management of the Affordable Project in a calendar year, including, without limitation:
painting, cleaning, repairs, alterations, landscaping, utilities, refuse removal, certificates, permits and licenses, sewer charges, real and personal property taxes, assessments, insurance, security, advertising and promotion, janitorial services, cleaning and building supplies, purchase, repair, servicing and installation of appliances, equipment, fixtures and furnishings which are not paid from the capital replacement reserve, fees and expenses of property management and common area expenses, fees and expenses of accountants, attorneys and other professionals, the cost of social services, repayment of any completion or operating loans including any and all deferred fees per the Budget, made to the BORROWER , its successors or assigns, Asset Management Fee, GP Asset Management Fee, and other actual operating costs and capital costs which are incurred and paid by the BORROWER, but which are not paid from reserve accounts.
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3. Except as amended hereby, all other terms and conditions of the Note shall remain in full force and effect.
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[Signatures follow on next page]