November 9, 2022
Will Sager
Director of Housing Finance
Linc Housing Corporation
RE: I Street Affordable Housing Project
Commitment to Allocate City of Merced 2021-2023 Permanent Local Housing Allocation (PLHA) funds of approximately $1,608,830.
Dear Mr. Sager,
On November 7, 2022, the City Council of the City of Merced approved and recommended that the City of Merced (“City”) commit the City’s 2021-2023 Permanent Local Housing Allocation (PLHA) funds of approximately $1,608,830 to Linc Housing (“Linc”) for the development of I Street Affordable Housing Project (“project”). The project is located at 1815 & 1823 I Street; 205 & 211 18th Street; and 202 W. 19th Street, with Assessor’s Parcel Numbers of 031-074-008; 031-074-009; 031-074-010; 031-074- 011; 031-074-012.
The PLHA funds will be available for construction and permanent financing under the following terms:
Interest rate: 3% simple annual
Term of Affordability: 55 years from occupancy
Term of Loan: 57 years
Repayment – Annual payments based on 50% of residual receipts, as defined in the loan agreement. When other public funding is involved, the City will share the distribution of residual receipts on a pro rata basis.
Collateral – Deed of trust secured by t he land or leasehold interest and improvements.
The City is in an Exclusive Negotiating Agreement (“ENA”) with Linc for the five parcels, and is currently negotiating a Disposition and Development Agreement (“DDA”). Linc’s project, utilizing Housing Successor Agency properties, is a 100% affordable housing development comprised of 54-units, for households earning at or below 30% and up to 80% of the area median income.
Linc Housing is known for successfully developing affordable and attractive properties throughout California. Thus, the City of Merced is excited to support Linc’s affordable housing project.
Sincerely,
Scott McBride
Development Services Director
City of Merced
C I T Y O F M E R C E D