Housing and Homelessness Committee Memorandum
TO: HOUSING AND HOMELESSNESS DATE: AUGUST 31, 2026
COMMITTEE MEMBERS
FROM: HOUSING AND HUMAN SERVICES WARD: 6
SUBJECT: PROPOSED ACQUISITION AND CONVERSION OF THE MOTEL 6 LOCATED AT 3663 LA SIERRA AVENUE AND THE DAYS INN LOCATED AT 10545 MAGNOLIA AVENUE INTO APPROXIMATELY 148 AFFORDABLE SENIOR HOUSING UNITS, AS PROPOSED BY ALLIED ARGENTA, LLC ISSUE:
Conceptually approve the proposed acquisition and conversion of the Motel 6 located at 3663 La Sierra Avenue and the Days Inn located at 10545 Magnolia Avenue into approximately 148 affordable senior housing units, as proposed by Allied Argenta, LLC.
RECOMMENDATION:
That the Housing and Homelessness Committee receive and file a report regarding the proposed acquisition and conversion of the Motel 6 located at 3663 La Sierra Avenue and the Days Inn located at 10545 Magnolia Avenue into approximately 148 affordable senior housing units, as proposed by Allied Argenta, LLC, and provide input regarding the continued coordination of the projects.
BACKGROUND:
Riverside County’s senior population continues to grow, increasing the need for affordable housing options that allow older adults to remain housed and age in place. Seniors living on fixed or limited incomes can face significant housing cost burdens, particularly as rents increase and the supply of affordable senior housing remains limited. The proposed projects would address a portion of this need by converting existing motel properties into dedicated affordable senior housing in locations with access to medical care, transportation, community amenities, and other services.
The two properties identified for the proposed conversions are currently operating as motels and are available for acquisition. Their existing motel configurations provide an opportunity to repurpose underutilized properties for affordable senior housing. The proposed conversions would create a combined 148 affordable senior housing units, including units restricted to households at 30 percent to 60 percent of Area Median Income (AMI), along with senior-oriented amenities and senior services. The projects are intended to provide housing options for seniors on fixed or limited incomes while making use of existing developed properties.
Allied Argenta, LLC
Allied Argenta, LLC (Allied) and its affiliated companies specialize in the acquisition, financing, development, construction, and management of affordable multifamily housing. Allied was established in 2009, and the development team has extensive experience in affordable housing development and financing. The company utilizes a variety of financing sources, including tax-exempt bonds, Fannie Mae, Freddie Mac, Federal Housing Administration (FHA) financing, private placement, and four percent (4%) and nine percent (9%) Low-Income Housing Tax Credits (LIHTC).
Allied operates through affiliated entities that provide services throughout the development process, including acquisition and development, construction, and property management. The development team also has experience developing affordable housing for individuals with developmental disabilities in partnership with local service providers.
The Allied development team has approximately 6,630 affordable housing units in its completed developments and current development pipeline, representing approximately $1.7 billion in total development costs, with approximately one-third of those projects consisting of senior housing. Additional information regarding Allied’s development experience is included in Attachment A.
DISCUSSION:
Allied has executed a letter of intent on two underutilized motel properties in the City of Riverside that are proposed for acquisition, rehabilitation, and conversion into dedicated affordable senior housing communities. The projects would preserve and repurpose existing motel properties to provide housing for seniors earning between 30% and 60% of Area Median Income (AMI). Both properties are currently underoccupied and require substantial rehabilitation and site improvements to support their long-term use as quality affordable housing. Collectively, the two projects would create 148 affordable senior housing units at a combined total development cost of approximately $64.4 million. 3663 La Sierra Avenue (Riverside, CA 92505). The proposed project would acquire and rehabilitate the existing 122-room Motel 6 located on approximately 2.1 acres and convert the property into 82 units of affordable senior housing. The unit mix would consist of approximately 41 studios, 40 one-bedroom units, and one two-bedroom manager’s unit. Twenty units are proposed to be restricted to households earning 30% of AMI and supported by Section 8 Project-Based Vouchers, with the remaining affordable units restricted to households earning between 50% and 60% of AMI. The rehabilitation would also include site improvements, including secured perimeter gates and controlled access for residents, to enhance resident safety and security.
The project is anticipated to utilize a 4% Low-Income Housing Tax Credit (LIHTC) and tax-exempt bond execution through the California Housing Finance Agency’s (CalHFA) Mixed-Income Program (MIP). The current estimated total development cost is approximately $39.6 million. Anticipated sources include approximately $16.4 million in tax credit equity, $8 million in permanent debt, $4 million in MIP financing, $9 million in soft financing, and $2.2 million in deferred developer fee.
The current estimated construction cost is approximately $98,901 per unit, or $250 per gross square foot. To support project feasibility, the development team intends to pursue approximately $9 million in Affordable Housing and Sustainable Communities (AHSC) funding and is seeking the City of Riverside’s assistance in pursuing and securing these funds. The AHSC funding would serve as a significant component of the project’s soft financing and help enable the conversion of the existing underutilized motel property into long-term affordable senior housing.
Unit Mix: 3663 La Sierra Avenue
Unit Type
Units
Avg. SF
AMI Level
Rental Assistance
Monthly Rent
Studio
10 243
30%
Project-Based Voucher
$645
31 243
50%
None
$1,076
One-Bedroom
10 390
30%
Project-Based Voucher
$691
30 390
60%
None
$1,383
Two-Bedroom
1 1,350
Manager’s Unit
None
None
Total
82 328
Rents shown are 2026 maximum LIHTC rents at the stated AMI level. The 20 units restricted at 30% of AMI would be supported by Section 8 Project-Based Vouchers underwritten at contract rents of $1,616 per studio and $1,852 per one-bedroom, with residents paying approximately 30% of their household income.
Anticipated Timing: 3663 La Sierra Avenue
Target Date
Milestone
August 2026
Housing and Homelessness Committee Meeting
March 2027
AHSC Application
December 2027
AHSC Award
February 2028
MIP Application (tax credits and soft funds)
April 2028
CalHFA Loan Approval
May 2028
Tax Credit Application
August 2028
Tax Credit Award
December 2028
Acquisition Closing
October 2029
Construction Completion
December 2029
Full Lease-Up
10545 Magnolia Avenue (Riverside, CA 92505). The project would acquire and rehabilitate the existing 66-room Days Inn located on approximately 0.77 acres and convert the property into 66 units of affordable senior housing, consisting of 65 studios and one one-bedroom manager’s unit. Fifty units, or approximately 75% of the project, would be restricted to households earning 30% of AMI and supported by Section 8 Project-Based Vouchers, with the remaining 15 units affordable to households earning between 50% and 60% of AMI. Similar to the proposed project at 3663 La Sierra Avenue, the rehabilitation would include secured perimeter gates and controlled access for residents to enhance resident safety and security.
The project is anticipated to utilize a 9% Low-Income Housing Tax Credit (LIHTC) execution with a total estimated development cost of approximately $24.7 million. Anticipated sources include approximately $9.7 million in tax credit equity, $4.7 million in permanent debt, $9 million in soft financing, and $1.3 million in deferred developer fee.
The development team anticipates securing Section 8 Project-Based Vouchers for a portion of the 30% AMI units through the local housing authority. For the remaining 30% AMI units, the project is seeking a City of Riverside commitment for rental assistance to support the proposed affordability. Based on current projections, the requested assistance would represent approximately $7.7 million over a 20-year term. This long-term rental assistance commitment is an important component of the project’s financial feasibility and would allow the project to maintain a significant portion of its units at deeply affordable rents for senior households.
The project is also anticipated to pursue funding through the Transformative Climate Communities (TCC) Program, with the assistance of the City of Riverside, to address the project’s remaining soft financing needs and improve the overall financial feasibility of the development.
Unit Mix: 10545 Magnolia Avenue
Unit Type
Units
Avg. SF
AMI Level
Rental Assistance
Monthly Rent
Studio
50 274
30%
Project-Based Voucher
$645
15 274
50%
None
$1,076
One-Bedroom
1 450
Manager’s Unit
None
None
Total
66 277
Rents shown are 2026 maximum LIHTC rents at the stated AMI level. The 50 units restricted at 30% of AMI would be supported by Section 8 Project-Based Vouchers underwritten at a contract rent of $1,616 per studio, with residents paying approximately 30% of household income.
Anticipated Timing: 10545 Magnolia Avenue
Target Date
Milestone
August 2026
Housing and Homelessness Committee
September 2026
TCC Program Application
May 2027
TCC Program Award
July 2027
Tax Credit Application
September 2027
Tax Credit Award
March 2028
Acquisition Closing
February 2029
Construction Completion
May 2029
Full Lease-Up
Supportive Services and Property Management. Resident services at both communities will be provided by Life Steps, an experienced LIHTC resident services provider with locations throughout Southern California. Allied will also coordinate with the Riverside County Office on Aging and the Housing Authority to develop a resident services plan tailored to the needs of the senior residents, including coordination of supportive services and resources available to residents receiving Section 8 Project-Based Vouchers. Allied will continue to coordinate with the City’s Department of Housing and Human Services as the projects advance through site control, design, and financing applications and will return to the Committee with updates at key project milestones.
Senior Amenities. Each property will be specifically renovated and designed to address the needs of senior residents, promote aging in place, and maximize residents’ ability to live independently. Based on Allied’s review of the local senior housing market, existing senior communities in Riverside are generally highly occupied, which may limit housing options for seniors seeking units specifically designed to accommodate their needs. The final amenity package will be developed as the projects advance; however, proposed in-unit features include grab bars in bathrooms and showers, shower chairs, slip-resistant flooring, maximum water temperatures of 120 degrees for resident safety, raised electrical outlets, and lever-style door and plumbing handles.
Proposed common-area amenities include a fitness center equipped for senior residents, a dedicated community room for resident activities and programming, and an expanded supportive services program focused on senior health, wellness, independence, and connection to community resources. The final amenity package will be refined based on project design, resident needs, available funding, and applicable program requirements.
Property Management Experience. Allied has experience owning and managing affordable housing communities through its affiliated Argenta Property Management Group, LLC. Depending on the needs of each community, Allied evaluates whether properties should be managed directly or through an experienced third-party property management firm.
For the proposed Riverside communities, Allied anticipates selecting a third-party property management firm with substantial experience operating affordable senior housing, preferably with experience in Riverside County. Although a final management company has not yet been selected, Allied is evaluating several experienced firms, including Falkenberg/Gilliam & Associates, Inc., a Southern California firm with more than 50 years of experience specializing in affordable senior housing and managing approximately 20 senior communities across Los Angeles, Orange, San Bernardino, Riverside, and San Diego counties. Allied is also evaluating Royal Property Management, a San Diego-based firm that manages family, senior, and supportive housing communities in Riverside, San Diego, Orange, and Los Angeles counties.
Other established affordable housing management firms, including FPI Management and New Earth Residential, may also be considered as the projects advance. New Earth Residential currently provides property management services for other communities in Allied’s portfolio. The final property management selection will be based on the firm’s experience with affordable senior housing, familiarity with Riverside-area resources, capacity to provide high-quality resident services and property operations, and overall fit with the needs of the two communities.
Bloomberg Cities Idea Exchange. In April 2025, the City of Riverside began participating in the Renovating and Retrofitting Social Housing Idea through the Bloomberg Cities Idea Exchange (BCIE), delivered in partnership with C40 Cities. The BCIE is a global initiative that supports cities in sharing innovative approaches through technical assistance and peer-to-peer collaboration to advance projects that reduce greenhouse gas (GHG) emissions while supporting low-income or vulnerable communities.
As part of its participation in the BCIE, Riverside proposed a project focused on the renovation and energy-efficient retrofit of underutilized motel properties for conversion into affordable housing. The proposed improvements at 3663 La Sierra Avenue and 1054 Magnolia Avenue are anticipated to include upgrades to building materials, utility infrastructure, and other building systems to improve energy efficiency and reduce operating costs.
Both properties are located near existing transit corridors, providing residents with greater access to public transportation. The combination of energy-efficiency improvements, adaptive reuse of existing buildings, and access to public transit is consistent with the City's efforts to expand affordable housing while advancing climate and sustainability objectives.
The project provides an opportunity to demonstrate how the adaptive reuse of existing motel properties can simultaneously address affordable housing needs, improve the energy performance of existing buildings, and support the City's GHG reduction goals.
FISCAL IMPACT:
There is no immediate fiscal impact associated with this staff report, and no City funding commitment is being requested at this time. As the project advances toward development and financing approval, Allied will continue to pursue additional funding sources to address the project’s current $7.7 million funding gap. Any future request for City funding will be presented to the City Council for consideration and approval, as applicable.
Prepared by: Agripina Neubauer, Housing Project Manager Approved by: Michelle Davis, Housing and Human Services Director Certified as to
availability of funds: Julie Nemes, Finance Director
Approved by: Kris Martinez, Assistant City Manager
Approved as to form: James Johnson, Interim City Attorney Attachment: 1. Allied’s Development Experience
2. Presentation
Proposed Acquisition and Conversion of Motel 6 and Days Inn ● Page 7