HOUSING DEPARTMENT
EXCLUSIVE NEGOTIATION AGREEMENT AND RIGHT
OF ENTRY WITH LH HOUSING AND/OR
PROPERTYWORX LLC FOR THE DEVELOPMENT OF
AFFORDABLE HOUSING AT 71 VISTA MONTANA
September 1, 2026 Item 8.3
City Council
Erik L. Soliván
Housing Director
Banu San
Deputy Director
Background and Request for Proposals
• In December 2025, the Housing Department issued Request for Proposals CSJ HSG 12-15-2025, inviting qualified developers to design, finance, and construct workforce/middle-income housing on two City-owned sites: the Arena Hotel (817 The Alameda) and 71 Vista Montana • For 71 Vista Montana, the Request for Proposals sought a for-sale or rental housing proposal that:
• Maximizes allowable density and delivers units to households earning up to 80% of area median income
• Includes substantial parking and provides for demolition of the existing structure • Reimburses the City for its investment in the Property • Three proposals were received by the February 13, 2026 deadline Slide 2
Recommended Respondent: LH Housing
LH Housing was the highest-ranked respondent for
the Property based on its combined proposal and oral
interview scores.
Development Team
• LH Housing: wholly owned subsidiary of Genesis
Company; manages a pipeline of over 3,500 units
across California
• Decro Corporation: nonprofit partner with 35+ years
in city-funded affordable housing; affordability
covenant compliance
• Cloud Apartments: modular fabrication partner
Basis for Recommendation
• Demonstrated record delivering
large-scale projects on public land
• Repayment of the City’s $23 million
investment in the Property
• Accelerated delivery schedule
through modular construction
• Independence from constrained
public subsidy sources
Slide 3
Proposal Overview
572
rental residential units
Up to 80%
of area median income
served
440
spaces in a centralized
parking structure
$0
City cash subsidy requested
Vista Montana Parkside
• Studios, one- and two-bedroom
apartments up to 80% AMI
• Four residential parcels plus
one centralized parking
structure
• Phased modular construction
following demolition
• Private equity and conventional
debt; no tax credits requested
or City funding requested
Slide 4
Schedule of Performance
# Milestone Deadline
1 Consultant selection Within 30 days
2 Initial financing proposal Within 3 months
3 Due diligence completion Within 6 months
4 Preliminary Planning Review application Within 6 months 5 Financing commitments secured Within 24 months
6 Ground lease execution and construction start Within 36 months, subject to City Council Approval
Three-year Exclusive Negotiation Agreement, with the possibility of two six-month extensions at the City’s discretion. Milestones run from the execution of the Exclusive Negotiation Agreement. Substantial failure to meet these milestones, without the City’s express approval, will result in termination of the ENA.
Slide 5
Right to Award: Second-Ranked Respondent
If LH Housing is unable to successfully execute an agreement with the City or does not comply in a timely and diligent manner with any material obligation under the Exclusive Negotiation Agreement, the City may terminate negotiations and commence negotiations with the second-ranked respondent (Propertyworx LLC), as stated in the Request for Proposals.
Propertyworx LLC
• 426 apartments delivered
in two phases
• 100% affordable; all units at
or below 80% AMI
• Tax-exempt private activity bonds, low-income housing tax credits, potential City financing, and private capital • Stackable modular construction
Slide 6