December 17, 2024
Richmond Housing Authority (RHA)
Economic Development
DATE: December 17, 2024
TO: Chair Martinez and Members of the Richmond Housing
Authority Board of Commissioners
FROM:
Nannette Beacham, Director of Economic Development
Antoinette Terrell, RHA Executive Director
Gabino Arredondo, Project Manager
Subject:
Nevin Plaza II Lease Disposition and Development
Agreement (LDDA)
FINANCIAL IMPACT: The developer will be obligated to pay a share of residual receipts as ground lease rent in an aggregate amount
equal to the land value. RHA will share 50 percent of total residual receipts with other subordinate lenders as
payment toward ground rent. The developer (EAH
Housing) will retain the remaining 50 percent. RHA will provide a ground lease to the Developer for a nominal
annual payment of $1 per year plus RHA’s pro rata share of 50% of annual residual receipts in the aggregate
amount equal to the land value. The Developer will work diligently to pursue all additional sources of financing necessary to provide full funding of Phase II. All
development costs of the development of the Nevin
Plaza Phase II Project will be paid by EAH Housing.
PREVIOUS COUNCIL
ACTION:
December 15, 2020.
AGENDA
REPORT
December 17, 2024
STATEMENT OF THE
ISSUE:
EAH Housing notified and began negotiations with RHA
to move forward on the Nevin Plaza II affordable housing development project. The LDDA has been negotiated
between RHA (Lessor of the land) and the Developer,
EAH Housing (Lessee of the land) and is ready for Board consideration and approval. Once approved the
developer will begin the entitlement process and seek
additional funding for the project. The LDDA sets forth the mutually agreed upon terms for the Developer’s
construction of new units on the vacant site.
RECOMMENDED ACTION:
ADOPT a resolution authorizing the Executive Director to enter into a Lease Disposition and Development
Agreement (LDDA) and to negotiate and execute any
and all related documents and agreements, including the Ground Lease and Regulatory Agreement between the
Richmond Housing Authority and EAH Housing for the
development of the Nevin Plaza II affordable housing
project (APN 515-261-014-2) - Richmond Housing
Authority (Antoinette Terrell 510-620-6784/Nannette
Beacham 510-621-1306).
DISCUSSION:
Nevin Plaza II
Richmond Housing Authority (RHA) and EAH Housing entered into a Master Development Agreement dated December 15, 2020, for the rehabilitation (Nevin Plaza I) and new construction (Nevin Plaza II) of affordable housing units to serve the senior population. The Nevin Plaza II development is the new construction component of the two-phased senior affordable housing development, behind the existing Nevin Plaza Phase I rehabilitation development set to be completed in February 2025 (2400 Nevin Ave, 7 Story, 142 Units).
Nevin Plaza II will be located on the vacant lot immediately adjacent to Nevin Plaza Phase I. The selected development team, EAH Housing, over the last 3 months has advanced their engagement with the RHA team to draft and finalize all the agreements to proceed with the second phase. The execution of the agreements will facilitate the development team to proceed in the entitlements process and prepare to respond to funding opportunities.
For the Nevin Plaza II project, the EAH Housing team has proposed changes to the unit mix to maximize the number of affordable units while minimizing overall project development costs. The new program and design for Nevin Plaza II is a 76-unit, 5-story building, containing nineteen (19) studios, fifty-six (56) one-bedroom units, and one (1) two-bedroom manager’s unit. The reason for increasing the number of studio and one-
December 17, 2024
bedroom units and not including any two-bedroom units is to maximize the number of affordable units within a building height that minimizes the overall development cost that financing needs to be secured for. Nevin Plaza II will provide permanent affordable housing, with a range of affordability including eight (8) low income (60% AMI and below), thirty-one (31) very low income (50% AMI and below), and thirty-six (36) extremely low-income units (30% AMI and below).
Nevin Plaza Phase II - LDDA
The Nevin Plaza Phase II Lease Disposition and Development Agreement (LDDA) has been negotiated between RHA (Lessor of the land) and the Developer (Lessee of the land). The LDDA sets forth the mutually agreed upon terms for the Developer’s construction of new units on the vacant site. RHA will share 50 percent of annual residual receipts with other subordinate lenders as payment toward rent due under the ground lease in an aggregate amount equal to the value of the land, and the Developer will retain the remaining 50 percent. The Developer will work diligently to pursue all additional sources of financing necessary to provide full funding of Phase II. All predevelopment costs of the development of the Nevin Plaza Phase II Project will be paid by EAH Housing.
The development of this new construction is vital to the surrounding neighborhood, add services and provide additional affordable housing to those in need. Furthermore, this action is consistent with the deliverables in the 2019 Public Housing Authority Recovery and Sustainability (PHARS) agreement between HUD, RHA, and the City of Richmond.
DOCUMENTS ATTACHED:
Attachment 1 - Resolution
Attachment 2 - Draft Nevin Plaza II LDDA
Attachment 3 - Ground Lease
Attachment 4 - Regulatory Agreement