October 16, 2023
City of Visalia
Majestic Gardens
Supplemental Housing Successor Agency Funds Request
Majestic Gardens is a proposed permanent supportive housing development located at 4545 W. Noble Avenue in Visalia, CA. The existing 42-unit motel will be rehabilitated and converted into 1 manger’s unit and 41 units of permanent supportive housing. All units will be targeted to chronically homeless individuals that are living with disabilities such as mental illness, substance use issues, physical disabilities, HIV/AIDS, and other chronic health conditions. The project will feature designated office and community space so that supportive services can be provided onsite. Majestic Gardens has been brought forth in partnership between the City of Visalia, RHCB Development LP, and UP Holdings LLC to address the housing needs of homeless individuals.
The total development cost for Majestic Gardens is $17,298,880. Currently, the project has been awarded a $12,295,379 Homekey 3.0 grant for capital expenditure from the Department of Housing and Community Development (HCD). The project has also been awarded $1,800,000 in HOME ARP funds and $900,000 in Housing Successor funds by the City of Visalia, along with $502,000 in Housing and Homelessness Incentive Program (HHIP) funds from Anthem Blue Cross, $520,000 in HHIP funds from Health Net and $207,691 in Homeless Housing and Prevention Program (HHAP) funds from the Kings/Tulare Homeless Alliance.
Funding Source Amount
HCD - Homekey 3.0 $ 12,295,379
City of Visalia - HOME ARP $ 1,800,000
City of Visalia - Housing Successor $ 900,000 Health Net and Blue Anthem -HHIP $ 1,022,000
Kings/Tulare Homeless Alliance - HHAP $ 207,691 Total Secured Funds: $ 16,225,070
Total Development Cost: $ 17,298,880
Funding Gap: $ (1,073,810)
Currently, this project faces a $1,073,810 funding gap. As such, we write to you to request an additional $425,000 in funds for this project. The main driver behind this request is the unforeseen escalation of construction costs, which have reached a historical high in the past year. As such, our team continues to value engineer the design of this project to reduce construction costs and ultimately, the total development cost to bridge this gap. However, our efforts to value engineer this building are limited without jeopardizing its ability to align with city codes and our sustainability targets. As such, we seek the City’s support in bridging this gap. We fully recognize the need for fiscal responsibility and are committed to managing costs efficiently. We greatly appreciate the City of Visalia’s continued support and partnership throughout the planning and development of this project.
Thank you for your consideration,
Wayne Rutledge
RHCB Development LP