Development Approval
for 797 Almaden Apartments
March 14, 2023
Item 8.1
Jacky Morales-Ferrand
Director of Housing
Rachel Vander Veen
Assistant Director of Housing
BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Development Overview
Located at sites on 771, 777, 787, 797 South
Almaden Avenue
Developed by Resources for Community
Development
98 apartments for extremely low-income, very
low-income, and low-income individuals and
families
25 permanent supportive housing
• 15 permanent supportive homes for
individuals in need of mental health services
and their families
• 10 permanent supportive homes for
individuals and families who have experienced
chronic homelessness
44% are 2-bed and 3-bed apartments
2 BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Ground floor community
serving commercial space
of ~2300 sq ft for possible
Childcare Center
Additional amenities
Over 6,000 sq ft of open
space as a courtyard for
residents
Transportation amenities
Key Features
3 BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Funding
4 Source Amount Private or Public Type of Funding
Bank Loan $5,477,000 Private Lender Loan
City of San José $24,940,000 Public Loan
County of Santa Clara $4,000,000 Public Loan
California Department of Housing
and Community Development –
Affordable Housing and
Sustainable Communities
$20,000,000 Public Loan
California Department of Housing
and Community Development –
Infill Infrastructure Grant
$6,270,415 Public Grant
Private Equity
Investment $47,155,711 Private Investment Equity
Total $107,843,126
BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Across the Bay Area, cost of development is rising
Market Trends – Inflation
5 CDLAC
Round
Average Cost per Home
of Deeply Affordable*
Developments
% Change
since March
’22
7-Feb-23 $980,409 44%
9-Aug-22 $913,330 34%
16-Mar-22 $680,116 -
*Developments with <50% AMI average affordability
797 Almaden Deeply Affordable
Developments
% Increase in Cost per Home
2022 2023
32% 44%
BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Interest rates doubling in the past year leads to millions of dollars added in financing costs
Market Trends – Interest Rates
6 0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
Interest Rates
30-Day Average SOFR Construction Loan Rate
BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Deeply affordable housing creates homes for our City’s residents with the greatest need for safe, affordable homes
Deeper affordability serves
City’s lower income
residents who experience
• The least amount of
housing options available
• The widest gap between
market rents and rents
affordable to them
Affordability and Cost per Unit
7 San José Average
Market Rents
Studio $2,061
1-BD $2,364
2-BD $2,939
3-BD $3,622
797 Almaden 30% AMI
Rent Limits
50% AMI
Rent Limits
Studio $884 $1,473
1-BD $947 $1,579
2-BD $1,137 $1,896
3-BD $1,314 $2,190
BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Takeaways for 797 Almaden
8 32%
35%
40%
45%
50%
55%
60%Average Affordability (AMI)
CDLAC Applicants of Past 3 Rounds
797 Almaden's Average Affordability in Comparison
Deeper Affordability
797 Almaden
BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Takeaways for 797 Almaden
93/14/2023
$400,000
$500,000
$600,000
$700,000
$800,000
$900,000
$1,000,000
$1,100,000
$1,200,000
35.0%40.0%45.0%50.0%55.0%60.0%
COST PER HOME
AVERAGE AFFORDABILITY (AMI)
Cost per Home Response to Average Affordability
797 Almaden
BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Moving Forward
10 Reduce
Development
Costs by 15%
Modular/Prefab
Construction
Lower-cost,
Innovative Financing
Solutions
Consolidation of
Public Funding
Application Process
BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL NOFA PIPELINE AFTER 797 ALMADEN
113/14/2023
4 Remaining
Developments
Need
$93.5 Million
(519 homes)
3 Waitlisted NOFA
Applicants
Need an Additional
$50.5 Million
(595 homes)
7 New
Developments
1,113 Homes
$144 Million in
Total Anticipated
BUILDING GREAT PLACES INVESTING IN PEOPLE PROVIDING HOUSING FOR ALL Developer Partner
• Resources for Community Development
Gabriel Borden, Project Manager
Alicia Klein, Associate Director of Development
City Staff
• Planning
Ruth Cueto, Supervising Planner
Reema Mahamood, Planner III - Environmental Review
• CAO
Shasta Greene, Senior Deputy City Attorney
• Housing
Michael Jun, Development Officer
Banu San, Housing Policy & Planning Administrator
Shelsy Bass, Senior Development Officer
Thank you!
123/14/2023
Development Approval
for 797 Almaden Apartments
Jacky Morales-Ferrand
Director of Housing
Rachel Vander Veen
Assistant Director of Housing
March 14, 2023
Items 8.1