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CITY ATTORNEY’S OFFICE
3750 UNIVERSITY AVE., STE. 250
RIVERSIDE, CA 92501
(951) 826-5567
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RIVERSIDE, CALIFORNIA, SUPPORTING (1) THE FUNDING APPLICATIONS FOR THE
MULBERRY GARDEN FAMILY APARTMENTS PROJECT, CONSISTING OF 150 AFFORDABLE FAMILY HOUSING UNITS AT 2524 MULBERRY STREET, BY EDEN HOUSING, INC. , TO THE CALIFORNIA DEPARTMENT OF
HOUSING AND COMMUNITY DEVELOPMENT MULTIFAMILY FINANCE
SUPER NOFA, THE STATE OF CALIFORNIA EXCESS SITES LOCAL
GOVERNMENT MATCHING GRANTS PROGRAM, THE CALIFORNIA TAX
CREDIT ALLOCATION C OMMITTEE, AND ANY OTHER STATE, FEDERAL,
OR LOCAL GOVERNMENT SPONSORED AFFORDABLE HOUSING FUNDING OPPORTUNITIES, AND (2) A LOAN BY THE CITY OF RIVERSIDE TO EDEN HOUSING, INC . FOR UP TO $ 1,154,171.70 IN FY 2022/2023 HOME INVESTMENT PARTNERSHIPS ACT FUNDS; SUBJECT TO APPROVAL AND
EXECUTION OF NECESSARY AGREEMENTS
WHEREAS, on March 13, 2018, the City of Riverside (“City”) adopted a Housing First Plan which sets forth the City’s policies, goals, and objectives in addressing homeless issues, through the strategic alignment of municipal and regional resources, with an emphasis on providing homeless individuals housing first and then wrap-around services; and WHEREAS, Eden Housing, Inc., a California limited partnership (“Developer”), is currently securing financing for the development of a 100 percent affordable housing project, consisting of 209 rental units (150 units of Affordable Family Housing and 59 units of Affordable Senior Housing) located at 2524 Mulberry Street in the Downtown Neighborhood (“Project” or “Mulberry Garden Apartments”); and
WHEREAS, the mission of the Project would be to provide affordable housing to very low - and low-income individuals, families and seniors; and
WHEREAS, the Project aligns with the City’s Housing First Plan and would benefit the community; and
WHEREAS, on January 15, 2019, Governor Gavin Newsom signed Executive Order No. N- 06-19, which allows the production of a ffordable housing on state -owned Excess Sites (“Excess Sites”). The Executive Order authorizes the Department of General Services (“DGS”) and the Department of Housing and Community Development (“Department” or “HCD”) to identify and prioritize Excess Sites for sustainable, cost-effective, and innovative multi-family affordable housing projects; and
WHEREAS, on September 15, 2021, DGS and the Department selected Eden Housing, Inc. to develop affordable housing at 2524 Mulberry Street, Riverside, CA 92501; and
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28 CITY ATTORNEY’S OFFICE
3750 UNIVERSITY AVE., STE. 250
RIVERSIDE, CA 92501
(951) 826-5567
WHEREAS, Chapter 111, Statutes of 2021 (Assembly Bill (AB) 140) makes several statutory changes for the purpose of implementing the housing and homelessness provisions of the Budget Act of 2021, which establishes the Excess Sites Local Government Matching Grants (“LGMG”) Program (hereafter, “Program”) to be administered by the Department.
WHEREAS, the Program was allocated up to $30 million to provide funds for Predevelopment and Development Costs to selected projects that receive a financial contribution from a Local Government, as defined pursuant to Health and Safety Code section 50704.80(b).
Funding for the Program is made available pursuant to Health and Safety Code section 50704.81(a)(2).
WHEREAS, the Department has issued a Notice of Funding Availability (“ NOFA”), dated May 5, 2022, for the Program pursuant to Health and Safety Code section 50704.83(f); AND WHEREAS, Assembly Bill ( “AB”) 434 makes several statutory changes to the Health and Safety Code ( “HSC”) and to the Military and Veterans Code to provide funding pursuant to the Multifamily Finance Super NOFA for the Multifamily Housing Program ( “MHP”), the Veterans Housing and Homelessness Prevention (“VHHP”) program, the Joe Serna Jr. Farmworker Housing Grant (“FWHG”), and the Infill Infrastructure Grant Program of 2019 (“IIG-2019”); and WHEREAS, the Department has issued a Multifamily Finance Super NOFA ( “Super NOFA”), dated May 18, 2023 for the Program. Super NOFA applications are due by 4 p.m. on July 12, 2023; and
WHEREAS, the Program requires contribution from the City of Riverside to the Mulberry Gardens Apartments in order for Eden Housing, Inc. (“Applicant”) to apply for Program funds pursuant to AB 434. Towards that end, Applicant is submitting an Application for Progr am funds (“Application”) to the Department for review and consideration; and WHEREAS, the Program requires a resolution from the City of Riverside pursuant to AB 434 conceptually approving the budget attached as Exhibit A , including all sources, and demons trating the amount of local government contribution to the applicant for predevelopment and development costs for the Mulberry Garden Apartments, and the requested amount for the Program; and WHEREAS, the State of California Tax Credit Allocation Committee (“TCAC” ) and HCD, through the issuance of ongoing Notices of Funding Availability, have periodically invited public agencies and not -for-profit housing developers to submit applications to fund development of affordable and supportive housing for homelessness prevention; and WHEREAS, the Developer is pursuing affordable housing program funding for the Project
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28 CITY ATTORNEY’S OFFICE
3750 UNIVERSITY AVE., STE. 250
RIVERSIDE, CA 92501
(951) 826-5567
from HCD, DGS, and TCAC; and
WHEREAS, the City has also received H OME Investment Partnerships Act -ARP funds (“HOME Funds”) from the United States Department of Housing and Urban Development (“HUD”) pursuant to the Cranston- Gonzales National Housing Act of 1990, as amended (“HOME Regulations”); and
WHEREAS, the HOME Funds must be used in accordance with the HOME Regulations in order to increase housing for very low and low-income households; and WHEREAS, the Developer has also applied to the City for HOME Funds; and WHEREAS, the City supports the Developer’s applications and is willing to lend up to One Million One Hundred Fifty- Four Thousand One Hundred Seventy- One Dollars and Seventy Cents ($1,154,171.70) in FY 2022/2023 HOME Funds if the Developer meets the project readiness standards and other project requirements set forth in the HOME- Regulations and Guidelines and agrees to enter into the necessary agreements with the City; and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Riverside, California, as follows:
Section 1: The City Council hereby declares its support for Eden Housing, Inc.’s applications to DGS to receive LGMG Program funds for the development of affordable housing units on the state- owned Excess Site. The City also supports Eden Housing, Inc.’s applications for affordable housing grant and loan funds, including HCD and TCAC for affordable housing program funding and low- income housing tax credits, and any other State, Federal, or Local government sponsored affordable housing funding opportunities, as well as Eden Housing, Inc.’s application to the City for HOME Funds.
Section 2: T he City Council conceptually approves the budget attached hereto as Exhibit “A” and hereby declares its willingness to lend up to One Million One Hundred Fifty-Four Thousand One Hundred Seventy-One Dollars and Seventy Cents ($1,154,171.70) in FY 2022/2023 HOME to support the Mulberry Garden Family Apartments, if project readiness standards and other project requirements set forth in the HOME Regulations and Guidelines are met, subject to the negotiation and execution of a HOME loan agreement, and approval by the City Council. ///
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28 CITY ATTORNEY’S OFFICE
3750 UNIVERSITY AVE., STE. 250
RIVERSIDE, CA 92501
(951) 826-5567
ADOPTED by the City Council this _________ day of _____________, 2023.
___________________________
PATRICIA LOCK DAWSON
Mayor of the City of Riverside
Attest:
_____________________________
DONESIA GAUSE
City Clerk of the City of Riverside
I, Donesia Gause, City Clerk of the City of Riverside, California, hereby certify that the foregoing resolution was duly and regularly adopted at a meeting of the City Council of said City at its meeting held on the _________ day of _____________, 2023, by the following vote, to wit:
Ayes:
Noes:
Absent:
Abstain:
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Riverside, California, this ________ day of ______________, 2023.
_________________________________
DONESIA GAUSE
City Clerk of the City of Riverside
23-0791 sw 6/7/23
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CITY ATTORNEY’S OFFICE
3750 UNIVERSITY AVE., STE. 250
RIVERSIDE, CA 92501
(951) 826-5567
EXHIBIT “A”
BUDGET
Eden Housing - Mulberry Gardens Riverside- Family
4% Tax Credit
5/31/2023 3:54 PM Page 1
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BC D E F G H I J K L
Mulberry Gardens Family 4% Large Family CDLAC Region Inland Region DDA/QCT Yes, QCT 2022 and 2023 County: Riverside County Address 2524 Mulberry Street, Riverside CA, 92501 Opportunity Map Low Resource Area
SOURCES OF FUNDS TOTAL RESIDENTIAL COMMERCIAL
Construction
Period NOTES
Perm Loan Tranche A- NOI 3,577,000 3,577,000 17 yr/ 35 yr amt- 7.25% Perm Loan Tranche B- Section 8 3,648,000 3,648,000 17 yr/ 35 yr amt- 7.25% Developer Fee Table County 0 0 55 yr-3% RR 0 Total Developer Fee 5,500,000
City HOME 1,000,000 1,000,000 55 yr-3% RR 1,000,000 Deferred Fee 1,300,000 HCD LGMG 10,000,000 10,000,000 55 yr-0% 10,000,000 GP Equity (Capital Recont.) 2,000,000 HCD IIG 4,000,000 4,000,000 4,000,000 Net Cash Fee 2,200,000 Land Donation- GP Equity or Sponsor Loan TBD 3,183,743 3,183,743 55 yr-3% RR 3,183,743 Max Allowed 2,200,000 TUMF Fee Waiver 980,420 980,420 55 yr-3% RR 980,420
HCD- AHSC 13,700,000 13,700,000 55 yr-3% RR
CEC Build Grant - Sponsor Loan 681,790 681,790 681,790
Deferred Developer Fee 1,300,000 1,300,000 net dev fee 2,200,000 GP Equity 2,000,000 2,000,000 Max allowable 2,200,000 100 Investor Capital Contributions Fed only 33,752,313 33,752,313 0 3,375,231 TOTAL SOURCES 77,823,266 77,823,266 0 funds available 23,221,284 Const. period costs 72,521,051 50% TEST
Deprec Basis + Land 73,328,637
Construction loan needed 49,299,767 8.50%
18 mo const + 6 Total Construction Loan 49,299,767
Surplus/Gap 0 res/comm by sf Tax Exempt Bond @ 55% 40,330,750 100.00% 0.00% Construction Deferred Taxable Tail Bond 8,969,016 USES OF FUNDS TOTAL COST RESIDENTIAL COMMERCIAL BASIS 4% CREDIT Period Costs Costs 50% Test 55.00% LAND COST/ACQUISITION COSTS OF ISSUANCE 49,299,767
Land Cost or Value 3,183,743 3,183,743 0 3,183,743 CMFA = issuer CDLAC max Environmental Remediation 0 0 0 0 Bond Counsel 65,000
Carrying Costs 0 0 0 Bank Counsel 60,000
Legal & Closing Costs 30,000 30,000 0 30,000 Issuer Fee @ 18.75bp 92,437 Site Maintenance (i.e. Security, Clean-Up) 0 0 0 0 Issuer app/legal 10,000 Relocation 0 0 0 Issuer monitor during const 43,137
Demo 321,031
321,031 0 321,031 CDLAC 17,255
Off-Site Improvements 0 0 0 0 0 CDIAC 7,395
Total Acquisition Cost 3,534,774 3,534,774 0 3,534,774 Consultant 0 NEW CONSTRUCTION Attorney 45,000
Site Work and Utilities GC Estimate 2,984,666 2,984,666 0 2,984,666 2,984,666 Title costs 65,000 Structures 46,032,128 36,923,700 36,923,700 0 36,923,700 36,923,700 Const loan fee @ .75% 369,748 Solar & Battery Storage 246,158 1,974,824 1,974,824 0 1,974,824 1,974,824 Const/Perm lender costs 100,000 GC Contingency 1,213,350 1,213,350 0 1,213,350 1,213,350 Perm loan fee @1% 72,250 Cost Escalation Contingency 508,616 508,616 0 508,616 508,616 TOTAL 947,222 General Requirements 3.39% 1,461,466 1,461,466 0 1,461,466 1,461,466 Construction Period Ratio 75.00% Contractor Insurance & Bond 398,702 398,702 0 398,702 398,702 Basis Eligible Portion 479,811 Contractor Overhead & Profit 6.13% 2,729,213 2,729,213 0 2,729,213 2,729,213 Total New Construction Costs 9.52% 48,194,537 48,194,537 0 48,194,537
ARCHITECTURAL FEES
Design 660,170
660,170 0 660,170 660,170
Supervision 462,410 462,410 0 462,410 462,410
Total Architectural Costs 1,122,580 1,122,580 0 1,122,580 Survey and Engineering includes testing 450,000 450,000 0 450,000 450,000 CONSTR. INTEREST & FEES
Const. Loan Interest 5,552,386 5,552,386 0 3,457,146 5,552,386 Predev loan costs / interest 70,349 70,349 0 70,349 70,349 Construction loan fee (@ 0.75%) and expensCOI 0 0 0 00
City or County loan fees 0 0 0 00
Taxes 0
0 0 00
Insurance 1,800,000 1,800,000 0 1,800,000 1,800,000
Title and Recording COI 0 0 0 00
Total Construction Interest and Fees 7,422,735 7,422,735 0 7,422,735 PERMANENT FINANCING 0
Perm loan fee & Expenses COI 0 0 0
Cost of Bond Issuance 947,222 947,222 479,811 947,222
Title and Recording 20,000 20,000 0 20,000
legal 20,000 20,000 0 20,000
Other 0 0
Total Permanent Financing Costs 987,222 987,222 0 947,222
LEGAL FEES
Lender Legal Costs Paid by Applicant COI 0 0 0 00
Soft Lenders Legal 20,000 20,000 0 20,000 20,000
Other - Owner Legal 40,000 40,000 0 40,000 40,000
Total Attorney Costs 60,000 60,000 0 60,000
RESERVES
Capitalized Operating Reserve - 3 mo 405,175 405,175 405,175 Replacement Reserve 0 0
Services Reserve 0 0
HCD Transition Reserve Fee 0 0 0
Total Reserve Costs 405,175 405,175 0 0
Total Appraisal Costs 10,000 10,000 0 10,000 10,000
Total Construction Contingency Costs 10.00% 4,851,557 4,851,557 0 4,851,557 4,851,557 OTHER
Tax Credit App./Alloc./Monitoring fees 99,383 99,383 292,342 -192,960 Construction Management 288,618 288,618 0 288,618 288,618 Local Development Impact Fees 2,986,511 2,986,511 0 2,006,091 2,986,511 Permit Processing Fees 800,000 800,000 0 800,000 800,000 Market Study 5,500 5,500 0 5,500
Marketing & Lease up 197,500 197,500 0 197,500
Environmental 0
0 0 00
Furnishings 203,174 203,174 0 203,174 203,174
Printing 0 0 0 00
Soft Cost Contingency 3.7% 500,000 500,000 0 500,000 500,000 Total Other Costs 5,080,686 5,080,686 0 5,273,645
Total Project Cost 72,119,266 72,119,266 0 64,293,863 71,867,051
DEVELOPER COSTS
Developer Overhead/Profit 5,500,000 5,500,000 5,500,000 450,000 5,050,000 Consultant/Processing Agent 0
Project Administration
Broker Fees paid by owner
Construction Management Oversight
Other
Total Developer Costs 5,500,000 5,500,000 0 5,500,000 450,000 TOTAL PROJECT COST 77,619,266 77,619,266 0 69,793,863 72,317,051 Syndication Costs
Legal - Syndication & Investor 116,000 116,000 0 116,000 Audit 20,000 20,000 0 20,000
Consultant - Syndication 62,000 62,000 0 62,000
Legal- Organization 6,000 6,000 6,000
Total Syndication Costs 204,000 204,000 0 204,000
TOTAL PROJECT COSTS INCL. SYNDICATION 77,823,266 77,823,266 0 69,793,863 72,521,051 5,302,215