November 7, 2023
Richmond Housing Authority (RHA)
Economic Development
DATE: November 7, 2023
TO: Chair Martinez and Members of the Richmond Housing
Authority (RHA) Board of Commissioners
FROM:
Nannette Beacham, Director of Economic Development
Gabino Arredondo, RHA Interim Executive Director
Subject:
Contract Assignment from David Paul Rosen &
Associates (DRA) to NELB Consultants, LLC (NELB)
FINANCIAL IMPACT: None. Existing remaining DRA Contract Amount and Purchase Order (PO) will be transferred to the new NELB Contract and PO. The estimated contract amount to be
assigned is estimated at $170,918.42, amount may
lessen due to processing current unpaid invoices to DRA (FY 23-24 $100,000, PO 24200364, 42141191-400217;
FY 24-25 $70,918.42, 42141191-400217).
PREVIOUS COUNCIL
ACTION:
December 6, 2022; May 25, 2021; May 5, 2020;
December 18, 2018
STATEMENT OF THE
ISSUE:
The owner of David Paul Rosen & Associates (DRA), the
financial advisor for the Richmond Housing Authority
(RHA) Asset Repositioning activities, is retiring. RHA is still in need of the expertise of the remaining financial advisors. The employees of DRA are transitioning to a
new company, NELB Consultants, LLC (NELB). The
DRA financial advisors have been a key component of
RHA’s success on addressing the Public Housing
Authority Recovery and Sustainability (PHARS)
deliverables and having their continued advice as NELB
will be invaluable.
AGENDA
REPORT
November 7, 2023
RECOMMENDED ACTION: ADOPT a resolution assigning the David Paul Rosen & Associates (DRA) contract to NELB Consultants LLC, for
an estimated contract reassignment amount of
$170,918.42, with a term ending June 30, 2025 –
Richmond Housing Authority (Gabino Arredondo 620-
6606).
DISCUSSION:
Background
The Richmond Housing Authority (RHA) entered a Public Housing Authority Recovery and Sustainability (PHARS) Agreement with the Department of Housing and Urban Development (HUD) Region IX to address operational deficiencies of RHA and its ongoing financial viability. To improve its financial viability and long-term sustainability, RHA has embarked on repositioning regarding its Public Housing. The goal of the repositioning effort is to develop financial structures that eliminate current operating shortfalls, improve the living conditions of residents, revitalize and/or redevelop RHA housing assets, put in place long-term sustainable financial repositioning of each asset, and bring each asset up to modern standards of design, energy efficiency, resident amenities, and quality of construction.
Asset Repositioning – Contract Assignment
To support the implementation of RHA’s Asset Repositioning strategy, David Rosen and Associations (DRA) were contracted as the financial advisors for RHA to review all real estate transactions and agreements. DRA has been a key member in the success of the transfer of the Administrative Building to the City of Richmond, Hacienda Heights, and Nevin Plaza rehabilitation. DRA’s owner is retiring. RHA is still in need of the expertise of the remaining financial advisors of DRA, who will transition to NELB Consultants, LLC (NELB). RHA’s retention of competent financial advisors has been a key component in addressing PHARS deliverables. Maintaining the services of financial advisors who are familiar with RHA’s Asset Repositioning strategy and history is important for RHA’s continued success. For this reason, it is recommended the sole-source procurement be used. The scope will remain the same for the assigned contract to NELB, which includes:
Providing RHA with a range of financial advisory services for assessment of, and strategic, business, and financial planning for, RHA to manage its portfolio of public housing, Low-Income Housing Tax Credit (LIHTC) housing and special to assure its appropriate reinvestment, rehabilitation, and, if appropriate, its redevelopment.
Analyzing project financial, economic, and development feasibility, and compliance with the requirements and competitive criteria of leverage sources of
November 7, 2023
funding, both public (HUD and other) and private sector, of developer proposals for financial assistance from RHA.
Providing market real estate and demographic analysis for RHA as required for affordable housing and mixed income/mixed use development and/or financing supported by RHA.
Support the strategy for revitalization of RHA’s public housing properties (Nevin Plaza, Nystrom, Richmond Village I, II, and II, Hacienda, others) that may include rehabilitation or demolition and new development on some sites and disposition of others based on an assessment of market land values and disposition opportunities, site development and leveraged financing opportunities and constraints, carrying costs, community issues, and other relevant factors determined in conjunction with RHA staff.
Determining RHA’s development role and RHA ownership entity (e.g., general partner, co-general partner, guarantor, lender, and others) for each public housing redevelopment project, and its component parts based on the ongoing assessment of RHA’s staff and financial capacity, and the City’s interests. Reviewing existing loan agreement or other documentation regarding the City of Richmond’s investment into RHA’s affordable housing assets. Prepare estimates of project gap financing requirements for, and proceeds from, the rehabilitation, redevelopment and/or sale of Nevin Plaza, Nystrom, Richmond Village (I, II and/or III) and the Hacienda surplus parcel.
The estimated contract amount to be assigned is estimated at $170,918.42. The amount may lessen due to processing any unpaid invoices to DRA.
DOCUMENTS ATTACHED:
Attachment 1 – Resolution
Attachment 2 – New Assigned Contract to NELB
Attachment 3 – Past DRA Contracts
Attachment 4 – Sole-Source Justification