11/8/2 023
City of Visalia - Majestic Gardens
Encampment Resolution Funding (ERF) Round 3 Request
Majestic Gardens is a 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. 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. The project has secured $16,650,070 in development funding including $12,269,379 in Homekey 3.0 funds. Currently, this project faces a $648,810 capital funding gap. As such, we write to you to request an additional $648,810 in capital funds for this project. The primary driver behind this request is the unforeseen escalation of construction costs. Our team has made great efforts to reduce construction costs and the total development cost to bridge this gap. We also seek ERF funds to support the operation of Majestic Gardens. The project has secured 22 permanent supportive housing vouchers from the Kings/Tulare Homeless Alliance but is in need of rental subsidies for 19-units. We kindly request two (2) years of rental subsidy for 19 units as we work to obtain an alternate
long-term
subsidy commitment for this project. Please see a breakdown of this request below in Table 1.
Table-1: Rental Subsidies Request for Two-Years
# of Units Unit Type 2024 Fair Market Rent (FMR) Year 1 Rental Subsidy 19 0 BR 977 $222,756
# of Units Unit Type *2025 Fair Ma rket Rent (FMR) Year 2 Rental Subsidy 19 0 BR 1026 $233,928
Total Request $456,684
*Year 2025 FMR is based on an estimated 5% annual increase in FMRs.
Additionally, we would like to provide additional security, including an on-site watchman and staffing, to increase security at the property and ensure the safety of tenants, the property, and nearby neighbors. Thus, we request an operating subsidy in the amount of $144,506. As a result, the total request for ERF Round 3 is $1,250,000, as shown below in Table-2: ERF Rd. 3 Funding Request Summary.
Table-2: ERF Rd. 3 Funding Request Summary
Funding Activity Amount
Capital Development $ 648,810
Rental Subsidy (19-units for 2-years) $ 456,684 Operating Subsidy $ 144,506
Total Request $ 1,250,000
Sincerely,
Wayne Rutledge RHCB
Development LP