October 1, 2024, Item #3DATE: TO: FROM: CONTACT: SUBJECT: Summary: AG EN DA REPORT City of Poway CITY COUNCIL October 1, 2024 Honorable Chairman and Members of the Housing Authority Board Julie Procopio, Director of Development Servic_ewp Marie Sanders, Senior Management Analys~ (858) 668-4637 or [email protected] Fourth Amendment to the Exclusive Negotiating Rights Agreement with Wakeland Housing and Development Corporation for the Monte Vista Affordable Housing Project (APN 275-460-61-00) On August 16, 2022, the Poway Housing Authority Board (Authority) approved an Exclusive Negotiating Rights Agreement (ENRA) with Wakeland Housing and Development Corporation (Developer) to finalize the feasibility of constructing an affordable housing project for military veterans and developmentally disabled adults on an Authority owned site located at 12674 Monte Vista Road. To allow for further approvals and entitlements review, a Fourth Amendment allowing the addition of two 60-day term extensions to the ENRA is needed. Recommended Action: It is recommended the Poway Housing Authority Board: 1) Approve the Fourth Amendment to the ENRA with Wakeland Housing and Development Corporation (Attachment A); and 2) Authorize the Executive Director to execute the Fourth Amendment and all necessary documents. Discussion: The Authority approved an ENRA with the Developer on August 16, 2022 allowing for exclusive negotiations for the potential development of a 60-unit multi-family affordable community targeting military veterans, their families, and developmentally disabled adults located at 12674 Monte Vista Road. Three amendments have been executed since initial approval allowing for continued negotiations. The additional extensions resulted in the Affordable Housing Agreement and Ground Lease being successfully negotiated. However, the Developer and staff continue to diligently review city required entitlements, therefore, a Fourth Amendment to the ENRA is necessary. Through a series of term extensions provided in previously approved amendments to the ENRA, the final negotiating period is set to expire on October 5, 2024. If approved, the term of the Fourth 1 of 7
October 1, 2024, Item #3Amendment to the ENRA will provide two additional 60-day extensions. It is staffs objective to complete the entitlement process and request joint City Council and Authority approval at the November 19, 2024, regularly scheduled City Council meeting. Environmental Review: The Fourth Amendment to the ENRA is not a "project" as defined under Section 15378(b)(5) of the California Environmental Quality Act (CEQA) State Guidelines; therefore, no environmental review is required. Fiscal Impact: No fiscal impact is associated with approval of this amendment. Public Notification: A copy of this report was provided to Wakeland Housing and Development Corporation. Attachments: A. Fourth Amendment to Exclusive Negotiating Rights Agreement (Monte Vista Affordable Housing Development) Reviewed/Approved By: Assistant City Manager 2 of 7 Reviewed By: Alan Fenstermacher City Attorney Approved By: Ch~ City Manager
October 1, 2024, Item #3FOURTH AMENDMENT TO EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT BY AND BETWEEN THE POWAY HOUSING AUTHORITY AND WAKELAND HOUSING AND DEVELOPMENT CORPORATION MONTE VISTA HOUSING DEVELOPMENT 12674 Monte Vista Road, Poway CA 92064 This Fourth Amendment to Exclusive Negotiating Rights Agreement ("Fourth Amendment") is entered into as of this 1st day of October, 2024 ("Fourth Amendment Effective Date"), by and between the POWAY HOUSING AUTHORITY, a public body, corporate and politic ("Authority"), and WAKELAND HOUSING AND DEVELOPMENT CORPORATION, a California nonprofit corporation ("Developer"), each a "Party" and collectively the "Parties", on the basis of the following facts: RECITALS A. The Authority and Developer have entered into that certain Exclusive Negotiating Rights Agreement dated August 17, 2022, as amended by that certain First Amendment to Exclusive Negotiating Rights Agreement dated August 2, 2023, as further amended by that certain Second Amendment to Exclusive Negotiating Rights Agreement dated February 6, 2024, and as further amended by that certain Third Amendment to Exclusive Negotiating Rights Agreement dated June 4, 2024, (collectively, the "ENRA"). Unless otherwise defined in this Fourth Amendment, capitalized terms shall have the meanings ascribed to them in the ENRA. B. Pursuant to Section 1.2(A.) of ARTICLE 1. of the ENRA, the initial Term (or Negotiating Period) of the ENRA was a period of two-hundred seventy (270) calendar days commencing on the Effective Date of the Exclusive Negotiating Rights Agreement, August 17, 2022, and expiring May 14, 2023 ("Initial Term"). Section 1.2(A.) of the ENRA states that the Negotiating Period may be extended, in each case, by mutual written agreement of the Parties, for up to six (6) additional forty-five ( 45) calendar day periods and then for up to four ( 4) additional sixty (60) calendar day periods, and on the Authority's behalf by the Executive Director of the Authority ("Executive Director") if, in the Executive Director's sole discretion and determination, sufficient progress toward a mutually acceptable AHA, Ground Lease and related documents has been made during the initial two-hundred seventy (270) day negotiating period and during the then current Negotiating Period to merit such an extension. C. Pursuant to Section 1.2(A.) of the ENRA, the Parties extended the Term (or the Negotiating Period) of the ENRA as follows: (1) by letter agreement dated March 20, 2023, extending the Term of the ENRA for the period commencing May 15, 2023 and expiring June 29, 2023 ("First Extension Term"); (2) by letter agreement dated June 2, 2023, extending the Term of the ENRA for the period commencing June 30, 2023 and expiring August 13, 2023 ("Second Extension Term"); (3) by letter agreement dated September 5, 2023, extending the Term of the ENRA for the period commencing August 13, 2023 and expiring September 26, 2023 ("Third Extension Term"); (4) by letter agreement dated September 5, 2023, extending the Term of the Fourth Amendment to ENRA v2 3 of7 Page 1 of 5 ATTACHMENT A
October 1, 2024, Item #3ENRA for the period commencing September 27, 2023 and expiring November 10, 2023 ("Fourth Extension Term"); (5) by letter agreement dated November 1, 2023, extending the Term of the ENRA for the period commencing November 11, 2023 and expiring December 25, 2023 ("Fifth Extension Term"); (6) by letter agreement dated December 20, 2023, extending the Te1m of the ENRA for the period commencing December 26, 2023 and expiring February 8, 2024 ("Sixth Extension Term"); (7) by letter agreement dated February 7, 2024, extending the Term of the ENRA for the period commencing February 9, 2024 and expiring April 8, 2024 ("Seventh Extension Term"); (8) by letter agreement dated April 7, 2024, extending the Term of the ENRA for the period commencing April 9, 2024 and expiring June 7, 2024 ("Eighth Extension Term"); (9) by letter agreement dated June 6, 2024, extending the Term of the ENRA for the period commencing June 8, 2024 and expiring August 6, 2024 ("Ninth Extension Term"); and (10) by letter agreement dated July 31, 2024, extending the Term of the ENRA for the period commencing August 7, 2024 and expiring October 5, 2024 ("Tenth Extension Term"). D. In light of the impending expiration of the Tenth Extension Term of the ENRA and in light of the continued work on behalf of both Parties toward plans and entitlements, an acceptable affordable housing agreement for the potential Project, and an acceptable ground lease of the Site, the Parties now mutually desire to amend the ENRA by this Fourth Amendment to add up to four (4) additional potential extensions of the Term (or Negotiating Period) of the ENRA for a period of sixty ( 60) calendar days for each extension, pursuant to the terms of Section 1.2(A.) of ARTICLE 1. of the ENRA as amended by this Fourth Amendment. E. Except for the change to Section 1.2(A.) of AR TI CLE 1. of the ENRA agreed to by the Paiiies as described in this Fourth Amendment, all terms and conditions of the ENRA, including all Exhibits attached thereto, shall remain unmodified and in full force and effect. AGREEMENT NOW THEREFORE, in consideration of the foregoing Recitals, the mutual covenants and agreements contained in this Fourth Amendment, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Authority and Developer hereby agree to amend the ENRA as follows: 1. Recitals. The foregoing Recitals are made a substantive part of this Fourth Amendment. 2. Modifications to the ENRA. (a) Modification to the Term "this Agreement" in the ENRA. All references to "this Agreement" in the ENRA shall mean and include the Exclusive Negotiating Rights Agreement entered into by and between the Poway Housing Authority, a public body, corporate and politic, and Wakeland Housing and Development Corporation, a California nonprofit corporation, and dated August 17, 2022, as amended by the First Amendment to Exclusive Negotiating Rights Agreement entered into by and between the Poway Housing Authority, a public body, corporate and politic, and Wakeland Housing and Development Corporation, a California nonprofit corporation, and dated August 2, 2023, as further amended by the Second Amendment Fourth Amendment to ENRA v2 4 of7 Page 2 of 5
October 1, 2024, Item #3to Exclusive Negotiating Rights Agreement entered into by and between the Poway Housing Authority, a public body, corporate and politic, and Wakeland Housing and Development Corporation, a California nonprofit corporation, and dated February 6, 2024, as further amended by the Third Amendment to Exclusive Negotiating Rights Agreement entered into by and between the Poway Housing Authority, a public body, corporate and politic, and Wakeland Housing and Development Corporation, a California nonprofit corporation, and dated June 4, 2024, and as further amended by the Fourth Amendment to Exclusive Negotiating Rights Agreement entered into by and between the Poway Housing Authority, a public body, corporate and politic, and Wakeland Housing and Development Corporation, a California nonprofit corporation, and dated October 1, 2024, including all Exhibits attached thereto. (b) Modification to Second Sentence of Section 1.2(A.) of ARTICLE 1. of the ENRA. The second sentence of Section l.2(A.) of ARTICLE 1. of the ENRA is hereby deleted in its entirety and replaced with the following: "The Negotiating Period may be extended, in each case, by mutual written agreement of the Parties, for up to six (6) additional forty-five (45) calendar day periods and then for up to eight (8) additional sixty (60) calendar day periods, and on the Authority's behalf by the Executive Director of the Authority ("Executive Director") if, in the Executive Director's sole discretion and determination, sufficient progress toward a mutually acceptable AHA, Ground Lease and related documents has been made during the initial two-hundred seventy (270) day negotiating period and during the then cunent Negotiating Period to merit such an extension." 3. Miscellaneous. (a) Effect of Fourth Amendment. Except to the extent the ENRA is amended by this Fourth Amendment, the remaining terms and conditions of the ENRA, including all Exhibits attached thereto, shall remain unmodified and in full force and effect. In the event of a conflict between any of the terms contained in this Fourth Amendment and the terms contained in the ENRA, the terms of this Fourth Amendment shall govern, prevail and control. (b) Entire Agreement. The ENRA, including all Exhibits attached thereto, as amended by this Fourth Amendment, embody the entire understanding between the Authority and Developer with respect to their subject matter and can be changed only by an instrument in writing signed by the Authority and Developer. (c) Counterparts. This Fourth Amendment may be executed in one or more counterparts, each of which shall be deemed an original but all of which, taken together, shall constitute one in the same Fourth Amendment. ( d) Applicable Law; Venue. The laws of the State of California shall govern the interpretation and enforcement of this Fourth Amendment, without giving effect to its principles of conflicts of laws. Should litigation occur, such legal actions must be instituted in the Superior Court of the County of San Diego, State of California, in any other appropriate court of Fourth Amendment to ENRA v2 5 of7 Page 3 of 5
October 1, 2024, Item #3that county, or in the United States District Court for the Southern District of California, and both Parties irrevocably consent to the personal jurisdiction of such courts. (e) Attorneys' Fees. If an action or court proceeding is brought by a Party against the other Party under this Fourth Amendment, whether for interpretation, enforcement or otherwise, the prevailing Party in any such action or proceeding shall be entitled to recover attorneys' fees and costs from the other Party. (f) Authority. All individuals signing this Fourth Amendment for a Party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the Authority that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. [SIGNATURES BEGIN ON THE FOLLOWING PAGE] Fourth Amendment to ENRA v2 6 of7 Page 4 of 5
October 1, 2024, Item #3IN WITNESS WHEREOF, the Parties hereto have caused this Fourth Amendment to be executed as of the dates set forth opposite their signatures below. "AUTHORITY" POWAY HOUSING AUTHORITY, a public body, corporate and politic By: ____________ _ Chris Hazeltine Executive Director ATTEST: Dated By:---------------Carrie Gallagher, CMC City Clerk APPROVED AS TO FORM: By:----------------Alan Fenstermacher General Counsel KANE, BALLMER & BERKMAN By:---------------Kendall D. Levan Authority Special Counsel "DEVELOPER" WAKELAND DEVELOPMENT HOUSING AND CORPORATION, a California nonprofit corporation *see notes below By: _____________ _ Name: --------------Title: --------------Dated: --------By:--------------Name: --------------Title: --------------Dated: --------*Notes: In accordance with California Corporations Code Section 313, this document must be executed by the Corporation's Chief Executive Officer, President or Vice-President, on the one hand, and the Corporations' Chief Financial Officer, Treasurer, Assistant Treasurer or Secretary on the other hand. Page 5 of 5 Fourth Amendment to ENRA v2 7 of7