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Council Agenda: 10/06/2026
Item No.: 8.1 (a)
DRAFT--Contact the Office of the City Clerk at (408)535-1260 or [email protected] for final document.
RESOLUTION NO. ______________
A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN
JOSE (1) APPROVING A CONSTRUCTION- PERMANENT
LOAN COMMITMENT OF UP TO $5,700,000 IN THE LOW
AND MODERATE INCOME HOUSING ASSET FUND, OR
SUCH OTHER SPECIAL FUNDS AS THE CITY MAY
DESIGNATE, TO THE SANTA CLARA COUNTY HOUSING
AUTHORITY OR AN AFFILIATED DEVELOPMENT ENTITY
FOR THE REHABI LITATION OF 1510 NORTH FIRST,
FORMERLY KNOWN AS COMFORT SUITES HOTEL,
LOCATED AT 1510 NORTH 1
ST STREET; AND (2)
AUTHORIZING THE DIRECTOR OF HO USING, OR THEIR
DESIGNEE, TO NEGOTIATE AND EXECUTE LOAN
DOCUMENTS AND ALL OTHER DOCUMENTS,
INCLUDING ANY AMENDMENTS THERETO, RELATED
TO CITY FINANCING FOR THE REHABLITATION OF 1510
NORTH FIRST , FORMERLY KNOWN AS COMFORT
SUITES HOTEL, LOCATED AT 1510 NORTH 1ST STREET
WHEREAS, on February 22, 2024, the Santa Clara County Housing Authority (“SCCHA”) purchased the property for $10,250,200; and
WHEREAS, the Development proposes an adaptive reuse of the existing building, converting it into 58 affordable housing units, including one manager’s unit; and
WHEREAS, planned renovations include the installation of kitchenettes in each unit, accessible restroom upgrades, modifications to entry ramp, installation of a new parking garage gate, flooring upgrades, and other minor repairs; and
WHEREAS, this recommendation will allow the City to place an affordability covenant on the site for a term no shorter than 55 years as part of the requirement of the City’s funding; and
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Council Agenda: 10/06/2026
Item No.: 8.1 (a)
DRAFT--Contact the Office of the City Clerk at (408)535-1260 or [email protected] for final document.
WHEREAS, the affordability restriction will not be subordinated to any deeds of trust or instruments with the power of sale; and
WHEREAS, following completion of rehabilitation activities at1510 North First, SCCHA intends to make units at that site available to eligible occupants of the 1488 North First Street Project (formerly known as the Surestay), subject to applicable relocation, occupancy, Homekey, and HCD requirements; and
WHEREAS, upon completion of that transition and subject to HCD approval, the existing Homekey affordability restriction and related Homekey obligations applicable to 1488 North First Street are expected to be removed and replaced with a new Homekey affordability restriction recorded against 1510 North First Street;
WHEREAS, all 57 restricted units will be studios reserved for households at or below 30% of area median income (“AMI”), and all will be supported by project-based vouchers serving a combination of extremely low-income housing and special needs households requiring supportive services; and
WHEREAS, SCCHA will enter into a Housing Assistance Payments Contract for these units with an initial term of 20 years and an option to extend for up to an additional 20 years; and
WHEREAS, maximum rent and income limits are based on California Tax Credit Allocation Committee occupancy guidelines of 1.5 persons per bedroom; and
WHEREAS, the Development’s Maximum Income is $46,245 and Rent Limit is $1,079 for the 57 studios; and
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9/23/2026
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Council Agenda: 10/06/2026
Item No.: 8.1 (a)
DRAFT--Contact the Office of the City Clerk at (408)535-1260 or [email protected] for final document.
WHEREAS, the total development cost, including property acquisition cost, is $31.3 million; and
WHEREAS, if approved the City will commit up to $5,700,000 or $98,276 per unit, as a construction-to-permanent loan funded by the Low- and Moderate-Income Housing Asset Fund; and
WHEREAS, the City’s commitment will leverage additional sources, including developer equity, federal tax credit equity, and private construction and permanent financing; and
WHEREAS, the California Tax Credit Allocation Committee (“CTCAC”) awarded the Development an allocation of Low-Income Housing Tax Credits on June 22, 2026; and
WHEREAS, construction financing is expected to close by November 2026, with construction beginning in December 2026, and completing approximately 14 months later;
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF SAN JOSE THAT:
(1) A construction-permanent loan commitment of up to $5,700,000 in the Low- and Moderate-Income Housing Asset Fund, or such other special funds as the City may designate, to the Santa Clara County Housing Authority or an affiliated development entity for the rehabilitation of 1510 North First, formerly known as Comfort Suites Hotel, located at 1510 North 1
st Street, is hereby approved; and
(2) The Director of Housing, or their designee, is authorized to negotiate and execute loan documents and all other documents, including any amendment thereto, related to City financing for the rehabilitation of 1510 North First, formerly known as Comfort Suites Hotel, located at 1510 North 1st Street.
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9/23/2026
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Council Agenda: 10/06/2026
Item No.: 8.1 (a)
DRAFT--Contact the Office of the City Clerk at (408)535-1260 or [email protected] for final document.
ADOPTED this _____ day of ___________, 2026, by the following vote:
AYES:
NOES:
ABSENT:
DISQUALIFIED:
MATT MAHAN
Mayor
ATTEST:
TONI J. TABER, MMC
City Clerk