CITY COUNCIL STAFF REPORT
DATE: March 11, 2026 BUSINESS & LEGISLATIVE
SUBJECT: APPROVE THE REQUEST FOR FINANCIAL ASSISTANCE AND FUNDING COMMITMENT IN THE AMOUNT OF $3,000,000 FOR
DEVELOPMENT AND CONSTRUCTION OF A 72-UNIT AFFORDABLE
SENIOR HOUSING PROJECT LOCATED AT 1555 E. ALEJO ROAD IN
THE CITY OF PALM SPRINGS
FROM: Scott C. Stiles, City Manager
BY: Housing & Community Development
SUMMARY:
Wakeland Housing and Development Corporation (Developer) is proposing to develop a 72-unit affordable senior housing community (Project, Attachment A). The Project, situated on land owned by the United Methodist Church of Palm Springs (UMCPS) and to be leased to Developer, will serve seniors aged 55 and older with incomes at or below 60% of the Area Median Income (AMI). Developer is requesting a funding commitment letter (Attachment B) from the City for a $3,000,000 permanent financing loan and participation in the City’s Affordable Housing Fee Waiver Program.
RECOMMENDATION:
1. Approve a funding commitment in the amount of Three Million Dollars ($3,000,000) to Wakeland Housing and Development Corporation to provide permanent financing for the development of a 100 percent affordable housing community located at 1555 East Alejo Road in the City of Palm Springs.
2. Authorize the City Manager to execute the Funding Commitment Letter and other necessary documents to facilitate the funding commitment.
BUSINESS PRINCIPAL DISCLOSURE:
Wakeland Housing and Development Corporation is a nonprofit corporation (Attachment C).
City Council Staff Report
March 11, 2026 – Page 2
Wakeland Housing Funding Commitment
BACKGROUND:
The United Methodist Church of Palm Springs (UMCPS) issued the Request for Proposals (RFP) in April 2024 to leverage approximately two acres of its undeveloped land at 1555 E Alejo Road for the construction of affordable senior housing units. UMCPS sought a highly qualified developer who would be able to secure all necessary financing and operating subsidies independently while providing fair market value to the Church for the use of its land through a ground-lease agreement. Ultimately, the Church sought a partner that would manage the project for its entire life, ensuring proper maintenance and the provision of necessary tenant support services. In February 2025, Wakeland Housing and Development Corporation was selected as the developer for this project.
STAFF ANALYSIS:
Developer requests a $3,000,000 loan from the City to assist with the purchase of land.
The loan will accrue simple interest at 3 percent per annum, carry a 55-year affordability term, and be repaid from annual residual receipts, secured by a deed of trust on the property. The City anticipates making loan funds available for disbursement in Fiscal Year 2029, contingent upon completion of project entitlements, execution of loan documents, and confirmation of all other project financing sources. Pursuant to Resolution No. 24654, the project qualifies for the Affordable and Multi-Family Housing Incentive Program (Attachment D).
The proposed affordability program includes a total of 72 units, which will be affordable across multiple AMI levels, including units restricted at 30%, 50%, and 60% AMI, plus one manager unit. The project advances the City’s Housing Element goals by increasing the number of residential units for lower income households.
A 2025 table of incomes for Riverside County is shown below:
Income
Category
Percent
AMI 1 Person 2 Person 3 Person 4 Person 5 Person 6 Person Acutely Low 15% $10,900 $12,500 $14,050 $15,600 $16,850 $18,100 Extremely
Low 32% $23,500 $26,850 $30,200 $33,550 $37,650 $43,150 Very Low
Income 54% $39,200 $44,750 $50,350 $55,950 $60,450 $64,900 Low Income 86% $62,650 $71,600 $80,550 $89,500 $96,700 $103,850 Median
Income 100% $72,750 $83,100 $93,500 $103,900 $112,200 $120,500 Moderate
Income 120% $87,300 $99,750 $112,250 $124,700 $134,700 $144,650 Development Timeline
The development schedule for the affordable senior community at 1555 E. Alejo Road is estimated to last until late 2029. A preliminary timeline is provided below:
City Council Staff Report
March 11, 2026 – Page 3
Wakeland Housing Funding Commitment
December 2025: Funding request submitted to the City of Palm Springs. February 2026: Entitlements submission.
March 2026: Anticipated City funding award.
April 2026: Target date for entitlement approval.
April 2026: HCD SuperNOFA application submission.
September 2026: 4% TCAC (Tax Credit) application submission. December 2026: Anticipated 4% TCAC Award and submission to Plan Check. June 2027: Building permits issued and financial closing of the construction loan. June 2027: Construction commencement.
March 2029: Construction completion
September 2029: Conversion to permanent financing.
Outreach Activities
The project’s outreach strategy began in early 2025 with initial brainstorming sessions involving the UMCPS Congregation, followed by targeted discussions with immediate neighbors and the Agua Caliente Band of Cahuilla Indians. Moving into 2026, the focus shifts to creation of dedicated digital and print fact sheets, further congregational meetings in mid-March, and a comprehensive mailing campaign to residents and businesses. This proactive approach continues through the summer of 2026 with community presentations and consistent updates to stakeholders as the development progresses through the entitlement and predevelopment phases.
Regional Housing Needs Assessment Goals
To meet the state-mandated 6th Cycle (2021–2029) Regional Housing Needs Assessment (RHNA) the City has established a pipeline of 100% affordable developments, totaling approximately 470 units across several key projects. This portfolio includes the 203-unit Juniper Mission, the 82-unit 305 W. San Rafael project, and the 115-unit San Rafael Apartments project, all of which received significant funding commitments or Exclusive Negotiation Agreements between late 2025 and early 2026.
These developments specifically target residents at or below 60% of the AMI, ensuring a steady supply of low and very low-income housing. A critical component of this strategy is the proposed Project by Developer. This development would create 72 additional affordable homes for seniors aged 55 and older. It is anticipated this project would conclude within the current RHNA cycle.
ENVIRONMENTAL ASSESSMENT:
The proposed City action is exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Sections 15192–15194, which provide a statutory exemption for affordable housing projects meeting specified criteria. The Project qualifies for this exemption because it is a 100 percent affordable housing development located on an infill site and complies with applicable density, location, and affordability requirements. As a statutory exemption, the Project is not subject to further CEQA review or environmental analysis.
City Council Staff Report
March 11, 2026 – Page 4
Wakeland Housing Funding Commitment
ALIGNMENT WITH STRATEGIC PLANNING:
This item aligns with the following City Council Strategic Plan Broad Goal: Housing.
FISCAL IMPACT:
As proposed, a commitment letter for $3,000,000 would be provided to Developer to support the Project. The loan proceeds will be available for disbursement in Fiscal Year 2029, subject to City Council approval of a separate loan agreement. Terms of the loan are anticipated to have 3% simple annual interest rate; 57-year term (55-year affordability requirement), and payments based on residual receipts. The loan will be secured by a regulatory agreement, which ensures long-term affordability. If sold to another entity, the new buyers would be legally obligated to maintain the same rent limits for the remainder of the term. Other forms of security may include a leasehold deed of trust, and assignment of plans and contracts. The funding commitment may be terminated at the City’s sole and absolute discretion or if Developer is unsuccessful after three (3) attempts to obtain Low- Income Housing Tax Credits or other required financing. No General Fund impact is anticipated.
REVIEWED BY:
Department Director: Jay Virata
Assistant City Manager: Flinn Fagg
City Manager: Scott Stiles
ATTACHMENTS:
A. Project Proposal
B. Draft Funding Commitment Letter
C. Business Disclosure Form
D. Resolution Number 24654 – Affordable and Multi-Family Housing Incentive Program