Disposition and Development Agreement and
Ground Lease Deal Terms
1217 Euclid Street, 1211-17 Fourteenth Street and 1402 Wilshire Boulevard December 17, 2024
Item 11-A
December 17, 2024
Item 11-A
2 Brief Background
• 130 residences
• Original Proposal included City-owned parking lots located at 1217 Euclid Street, 1211-1217 Fourteenth Street, and 1146 16th Street • Identified for affordable housing in the City’s 2021-2029 Housing Element • Request for Proposal in 2023
• Development team led by Hollywood Community Housing Corp. (HCHC) selected in March 2024
• Council provided direction on August 27, 2024 on a revised proposal for the Development
December 17, 2024
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December 17, 2024
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3 Community & Business Outreach
1. HCHC hosted four
community meetings:
May 22nd and 23rd
July 8th and 10th
6. Development Team
shared current proposal at
Fifth Community Meeting
on October 23rd 2024
3. HCHC and kdA reviewed
feedback and modified
the proposal
2. We received feedback via:
• Community meetings
• Project website
• Project email
• Project voicemail
• Public comments at City
Council meetings
4. On August 27th, City
Council directed City staff to
continue negotiations with
HCHC for a revised
development at Euclid and
14th Streets totaling 130 apts
5. City staff conducted
door-to-door outreach to 31
businesses on Wilshire Blvd
employees’ and customers’ use
of the City-owned parking lots.
December 17, 2024
Item 11-A
December 17, 2024
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4 Revised Proposal Updates
Unit Type 1217
Euclid St
1211-1217 14th St &
1402 Wilshire Blvd
1146
16th St
Apt Type
Total
One Bed 21 80 (40 units to be PSH*)
To remain
as public
parking
101
Two Bed 14 2 16
Three Bed 13 0 13
Total 48 82 130
Unit Type 1217
Euclid St
1211-1217
14th St
1146
16th St
Apt Type
Total
Studio 0 4 9 13
One Bed 48 (40 units to be
PSH*) 0 0 48
Two Bed 17 13 7 37
Three Bed 0 28 4 32
Total 65 45 20 130
Original Proposal Revised (Current) Proposal
December 17, 2024
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December 17, 2024
Item 11-A
5 Revised Proposal Based on Community Input
• Fourteenth Street to house seniors 55+
• Euclid Street family housing
• Sixteenth Street to remain public parking
• Acquisition of 1402 Wilshire Boulevard to step down height adjacent to residential
• Increased security measures
• Vehicle queuing areas on-site to minimize alley congestion December 17, 2024
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December 17, 2024
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6 The Development – Euclid Street
Development Highlights:
• Six Stories
• 48 Affordable Housing Apartments
• Over 50% will be dedicated to larger bedroom residences • 21 one-bedroom residences
• 14 two-bedrooms residences
• 13 three-bedrooms residences
• 40 Tenant subterranean parking
• Incomes ranging from 30% to 60% of the Area Median Income (AMI) • One Full-time Property Manager residing on-site
December 17, 2024
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December 17, 2024
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7 The Development – Fourteenth Street / 1402 Wilshire Boulevard Development Highlights:
• Includes the acquisition of 1402 Wilshire Boulevard
• Tiered Development between three and six stories
• 82 Affordable Senior Housing Apartments
• 80 one-bedroom residences
• 40 dedicated supportive apartments with Project Based Vouchers from the Santa Monica Housing Authority
• 42 Tenant ground level parking
• Incomes ranging from 30% to 60% of the Area Median Income (AMI) • Two Full-time Property Managers residing on-site
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December 17, 2024
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8 Euclid Street
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9 Euclid Street
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10 14th Street and Wilshire Boulevard
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11 14th Street Elevation
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December 17, 2024
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12 Key Deal Terms – Acquisition of 1402 Wilshire Blvd
• Acquisition of 1402 Wilshire Boulevard by HCHC
• HCHC would own 1402 Wilshire Blvd until it has secured all construction financing • At that time, HCHC will transfer ownership to the City • City will concurrently ground lease the combined Fourteenth Street/1402 Wilshire Blvd site back to HCHC
• City to provide $6,000,000 acquisition loan; repayment at construction closing to reduce City loan down to $2,500,000 (approximate)
December 17, 2024
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December 17, 2024
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13 Key Deal Terms – Ground Leases + City Loan
• Residential Ground Lease
• The City will ground lease all three sites to the developer for a term of 55 years plus two options of 22 years
• The City will provide the two city-owned sites to the project (1217 Euclid and 1211 – 1217 14th Street).
• For these sites, the City will receive an annual rent payment of $1 per year plus residual receipts.
December 17, 2024
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December 17, 2024
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14 Key Deal Terms – Ground Leases + City Loan
• Public Lenders (including City’s Housing Trust Fund) receive 50% share of net cash flow (residual receipts) from the Developments.
• In affordable housing developments, residual receipts are the annual payments on the City Loan after all debt service and operational expenses are paid. • Industry Standard is 50% goes towards the public lenders and the remaining 50% goes towards the development partnership.
December 17, 2024
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December 17, 2024
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15 Key Deal Terms – Site Security
• A resident Property Manager will be on each site Monday - Friday from 8am to 5pm beginning with move-ins
• Fourteenth Street/1402 Wilshire Blvd site will have a second Assistant Property Manager Monday - Friday from 2pm to 10pm.
• At all times when not on duty, the Property Manager or Assistant Property Manager will be on-call and available by phone for after-hours emergencies. • HCHC will provide security for the first year of operations at the Fourteenth Street/1402 Wilshire Blvd site during night and weekend hours. • The City can request a meet and conferto assess the Development’s security needs.
December 17, 2024
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December 17, 2024
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16 Key Deal Terms – Tenant Selection
• Must utilize a City-administered waitlist
• City’s Below Market Housing (BMH) waitlist to fill general affordable apartments • Live/work priority
• Santa Monica Housing Authority’s waitlist to fill the Permanent Supportive Housing apartments, with priority for those homeless or at-risk of homelessness in Santa Monica (Santa Monica Priority Population - SMPP applicants).
December 17, 2024
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December 17, 2024
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17 Development Financing Summary
• If a funding gap should occur, City staff can approve Housing Trust Fund loans that comply with the City’s Housing Trust Fund Guidelines • Any request outside of the Housing Trust Fund Guidelines will be brought before City Council for approval
• HCHC anticipates a total funding gap from both developments of $13,500,000, which falls within the City’s Housing Trust Fund Guidelines. • This is inclusive of a $6,000,000 acquisition loan to HCHC to acquire 1402 Wilshire Boulevard and is allowable under the City’s Housing Trust Fund Guidelines.
December 17, 2024
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December 17, 2024
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18 Replacement Public Parking Assessment
• Parking Assessment
• 98 existing public parking spaces on Euclid Street and 14th Street • Parking study reflects that parking lots are utilized • Discussions with business owners reflect a concern for employee and business patron parking • 16th Street: 21 parking spaces will remain
• Replacement Parking Options
• 14th street on-site replacement: 35 replacement parking spaces • Would require additional $6,340,316 from City Housing Trust Funds • Nose-in Street Replacement: Not Recommended
• Safety Issue for streets with Traffic Signals
• Against Existing City Policy for Parking Regulations
• Current City Policy & Mobility Initiatives
• Limited Housing Trust Funds Resources
• Pending the Repayment of Housing Trust Funds, which continue to be withheld • Three remaining City-owned sites to support with HTF's to cover financing gaps • Thriving Commercial Corridors
• Montana Ave/Ocean Park Ave are evidence of thriving commercial corridors in our city that do not have public parking lots December 17, 2024
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December 17, 2024
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19 Next Steps
• Entitlements in progress
• With City Council Approval, the City Manager will execute a DDA and associated documents to allow HCHC to apply for outside financing • Euclid Street
• Tax credit funding application in March 2025
• If successful, construction will start in late 2025
• Construction completed and move-ins estimated for 2027. • Fourteenth Street/1402 Wilshire Blvd
• MHP Funding Application and Acquisition of 1402 Wilshire in Second Quarter of 2025 • Tax Credit and Tax-Exempt Bond Funding Application in September 2025 • If successful, construction will start in Spring 2026 • Construction completed and move-ins estimated for 2028 December 17, 2024
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December 17, 2024
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