STAFF REPORT
Lancaster Housing Authority
HA CC 1
8/11/26
TN
Date:August 11, 2026
To: Chairman Parris and Authority Members
From:Patti Garibay, Director - Community Development
Becky Bartlett, Manager – Housing
Subject:Approve Extension to Exclusive Negotiating Agreement with Grupe Investment Company, Inc.
Recommendation:
1. Authorize the Executive Director or his designee to negotiate, finalize, and execute an Extension to the original Exclusive Negotiating Agreement (ENA) with Grupe Investment Company, Inc. for an additional 180-day period for the potential disposition of property owned by the Lancaster Housing Authority. No deposit will be required.
2. Authorize the Executive Director or his designee to negotiate, finalize, and execute all related documents in a form approved by the City Attorney.
G.C. Section 84308: No
Fiscal Impact:
None.
Background:
The Lancaster Housing Authority ("Authority") owns several properties designated for affordable housing development. One such site, known as HNR-3, consists of approximately 35 acres across four parcels located on the former Antelope Valley Fairgrounds at the intersection of Avenue I and Division Street.
Following a competitive Request for Proposals (RFP) process completed in early 2023, the Authority entered into an Exclusive Negotiating Agreement (ENA) with Grupe Investment Company, Inc. ("Grupe") to explore the redevelopment of a portion of the site. Grupe proposes 2 4
7 4
to acquire approximately 12.9 acres of HNR-3 and obtain the necessary entitlements to develop approximately 200 workforce for-sale condominium units.
Although the final affordability mix is still being refined, the proposed homes are anticipated to serve first-time homebuyers earning between 80% and 120% of Area Median Income (AMI), with the majority targeted at households earning approximately 80% of AMI. The development is expected to include a mix of two-, three-, and four-bedroom homes, along with neighborhood amenities such as a community center, swimming pool, and recreational open space.
The original agreement was effective on May 27, 2025, and was subsequently amended on August 26, 2025 (first amendment) and November 18, 2025 (second amendment). This proposed third amendment for 180 days is effective on August 11, 2026, with an expiration date on February 7, 2027. The proposed extension of the original Exclusive Negotiating Agreement (ENA) will allow staff and the developer to continue formal negotiations toward a Disposition and Development Agreement (DDA) for the sale and development of the property. Additional time is needed to finalize negotiations and prepare the DDA for execution. If staff and the developer are unable to reach mutually acceptable terms during the extended ENA period, the property will be remarketed to other potential developers. The ENA does not obligate the Authority to sell the property, and any resulting DDA will be subject to approval by the Authority.
Extending the ENA is necessary to facilitate coordination of this larger, multi-phased redevelopment effort, which includes development partners delivering complementary rental and for-sale housing on the broader HNR-3 site. The additional time will allow the development team and Authority staff to coordinate project design, shared infrastructure, financing strategies, and construction sequencing while completing a comprehensive DDA. This extension will help ensure the overall redevelopment is cohesive, financially feasible, and consistent with the Authority's long-term vision for the property.
The proposed project advances one of Lancaster's highest housing priorities by expanding affordable homeownership opportunities for moderate-income and workforce households that have increasingly been priced out of the local housing market. By delivering thoughtfully designed homes, quality community amenities, and a walkable neighborhood environment, the project will support housing stability, promote wealth-building through homeownership, and strengthen the City's long-term economic and community development objectives.
Attachment:
Exhibit A – Third Amendment to Exclusive Negotiation Agreement (ENA) with Grupe Exhibit B- Original ENA, 1st Amendment, & 2nd Amendment with Grupe