HomeMy WebLinkAboutCT 92-02; Sambi Seaside Heights LLC; 1998-0388731; Affordable Housing Agreement/ReleaseW$QN&Irq REQUESTED BY:
City of Carlsbad
1200 Carlsbad Village Drive
Carlsbad, CA 92008
1659 DOE :: 1998-0388731
- JUN 24s 1998 3=47 PMI
UFFICIAL REaRDs ~~~~~~E
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WHEN RECORDED SEND TO:
City Clerk’s Office
City of Carlsbad
1200 Carlsbad Village Drive
Carlsbad, CA 92008
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ESTOPPEL CERTIFICATE AND AMENDMENT TO
AFFORDABLE HOUSING AGREEMENT BETWEEN THE
OLSON COMPANY, A CALIFORNIA CORPORATION,
AND THE CITY OF CARLSBAD, A MUNICIPAL
CORPORATION
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ESTOPPEL CERTIFICATE AND AMENDMENT TO
AFFORDABLE HOUSING AGREEMENT
THIS ESTOPPEL CERTIFICATE AND AMENDMENT TO AFFORDABLE
HOUSING AGREEMENT (this “Certificate”) is entered into as of .!Jec cdfrp .?o , 1997 by and
between the CITY OF CARLSBAD, a municipal corporation (the “City”), and THE OLSON
COMPANY, a California corporation (“Olson”).
RECITALS
A. The City and Sambi Seaside Heights, L.L.C. (the “Original Developer”) have entered
into an Affordable Housing Agreement Imposing Restrictions on Real Property, dated November 11,
1996 (the “Affordable Housing Agreement”), which provides for 42 single family houses to be made
affordable to lower income households on certain land in the City of Carlsbad owned by the Original
Developer (the “Site”).
B. Olson desires to purchase a portion of the Site from the Original Developer, and to
assume all of the obligations of the Original Developer under the Affordable Housing Agreement.
C. In executing this Agreement, the City understands and acknowledges that Olson will be
relying upon the information and the representations and warranties contained herein in agreeing to
purchase a portion of the Site from the Original Developer and assume the Affordable Housing
Agreement.
NOW THEREFORE, in consideration of the foregoing recitals, and for other good and
valuable consideration, the receipt and suEiciency of which are hereby acknowledged, the City certifies
and the parties hereto agree as of the date of this Certificate as follows:
1. Affordable Housing Agreement in Full Force and Effect. The Affordable Housing
Agreement is in full force and effect and, except to the extent amended or modified by this Certificate,
has not been amended or modified and remains in full force and effect. Other than the Affordable
Housing Agreement and this Certificate, to the City’s knowledge there are no other documents,
agreements or instruments evidencing the affordable housing requirements imposed by the City with
respect to the Site.
2. Approval of Olson. The City hereby approves the assignment of the Original
Developer’s rights and obligations pursuant to the Affordable Housing Agreement to Olson, or to a
limited liability company of which Olson is the managing member (the “Olson LLC”). The City agrees
to accept the performance of the Original Developer’s obligations under the AfEordable Housing
Agreement by Olson or the Olson LLC, and to perform all of its obligations under the Fordable
Housing Agreement for the benefit of Olson or the Olson LLC, as applicable.
529442.3uptzD2782.0009
12124197 1
1661 -.
3. No Defaults. The City has not given any notice of default to the Original Developer
and, to the best of City’s knowledge, no event or circumstance presently exists which, with giving of
notice or the passage of time, or both, would constitute a default by the Original Developer under the
Affordable Housing Agreement.
4. Affordable Housing Cost Schedule. The Schedule of Maximum Eligible Buyer
Incomes and Affordable Subsidized Purchase Prices attached hereto as Exhibit “B” hereby replaces
and supercedes Exhibit “B” to the Affordable Housing Agreement.
5. Market Purchase Price Determination. The “Market Purchase Price” of the
AfFordable Units pursuant to Section 2.4.2 hereof shall be determined by the mutual agreement of the
parties, based upon an appraisal and/or market study to be commissioned by Olson.
6. Subordination. The City has found, concurrently with its approval of this Certificate,
that an economically feasible method of financing for the construction of the single family houses on
the Site, without the subordination of the affordable housing covenants as may be set forth in the
mordable Housing Agreement, is not reasonably available. City agrees that the affordable housing
covenants set forth in the Affordable Housing shall be junior and subordinate to the deeds of trust and
other documents required in connection with the financing for the construction of the single family
houses on the Site. The City Housing and Redevelopment Director, or his or her designee, is hereby
authorized to execute such subordination agreements and/or such other documents as may be
necessary to evidence such subordination without further authorization from the City, provided that
such subordination agreements contain written commitments which the City Housing and
Redevelopment Director, or his or her designee, finds are reasonably designed to protect the City’s
investment in the event of default, such as any of the following: (a) notice to the City of default by
Olson simultaneously with delivery of such notice to Olson, (b) a right of the City to cure a default on
the loan prior to foreclosure, (c) a right of the City to negotiate with the lender after notice of default
from the lender and prior to foreclosure, (d) an agreement that if prior to foreclosure of the loan, the
City takes title to the property and cures the default on the loan, the lender will not exercise any right it
may have to accelerate the loan by reason of the transfer of title to the City, and (e) a right of the City to
reacquire the Site from the Developer at any time after a material default on the loan.
7. City Second Mortgage Documents. The City Second Mortgage documents to be
provided by the City pursuant to Section 3.1.4 of the AtTordable Housing Agreement may be modified
with the mutual agreement of the parties.
8. Address for Notices. Notices to Olson pursuant to Section 11 of the Affordable
Housing Agreement shall be sent to the following address:
The Olson Company
3010 Old Ranch Parkway, Suite 400
Seal Beach, California 90740-2750
Attention: Mark Buckland, President
9. Counterparts. This Agreement may be executed in counterparts, and each shall
constitute an original and all taken together shall constitute one Agreement.
529442.3!Jg0etA22782.0009
12/24/97 2
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. I 1666
NOW, THEREFORE, the parties hereto have executed this Certificate as of the date first set
forth above.
CITY:
CITY OF CARLSBAD, a municipal corporation
By:
AT-EST:
NYAK,Community
t Director
City Clerk
APPROVED AS TO FORM:
Cky Attorney
OLSON:
THE OLSON COMPANY, a California corporation
By: +LcEc*mvE VIE P@.EstDi3a-
KENT L. GROVER, Executive Vice President
529442.3\Jgod22782.0009
12124197
. . . 1665
State of California >
1
County of San Diego )
On June 19. 1998 before me, Ronna S. Stickrod, Notarv Public , personally
appeared Martin Orenyak , personally known to.me to be the person whose name is
subscribed to the within instrument and acknowledged to me that he executed the
same in his authorized capacity, and that by his signature on the instrument the
person, or entity upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal
%s &-d
Signature of Notary
(This area for official notary seal)
.Jun-10-98 09:57A ’ JW-BY-1938 X:55 FT--’ CLQRK g TGEVITHICK TO - 156zB6491.2 P-02 P -03103
CERTIFICATE OF OFFlCER
The undersigned, the duly elected and acting Assistant Secretary of The Olson
Company, a California corporation, hereby certifies that the following resolution was adopted at a duly convened meeting of the Board of Directors of The Olson Company on
April 14, 1998 and that such resokion is in full force and effect as of the date hereof:
General Authority Regarding Land Acquisition and
es for &al Estnte Dev~ Ptw
“RESOLVED, that Stephen E. Olson and/or Mark
Buckland and/or Kent Grover, or any of them acting alone, be
authorked on bebnlf of this corporation to ( 1) enter into real
property purchase agreements on such telms and conditions as
such officers may deem appropriate and to execute the definitive
and collateral documents, (2) organize limited liability
companies or limited partnerships in which this corporation is the managing member or general pmer, (3) execute The Olson
Company guarantees of limited liability company or pamership
obligations and (4) enter into any other contracts which are necessary, appropriate and related to this corporation’s
acquisition of real property and construction of residences. ”
Dated: June 9, 1998
L5-kccc(fL
Dkald P. Clark, Assistant Secretary
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TOTRL P.B3
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SCHEDULE OF MAXIMUM ELIGIBLE BUYER INCOMES AND AFFORDABLE
SUBSIDIZED PURCHASE PRICES
“Affordable Purchase Price” for the purposes of the Affordable Housing Agreement is that
purchase price which would result in monthly housing costs which do not exceed the product of
one-twelfth (l/12) of thirty percent (30%) times eighty percent (80%) of San Diego County median
income adjusted for family size appropriate for the house. Family size appropriate to the unit is
defined as 3.5 persons for a two bedroom house and 5.5 persons for a three bedroom house.
Median income for 3.5 persons shall be calculated by adding the median income for a family of
three and the median income for a family of four, and dividing that sum by two. Median income
for 5.5 persons shall be calculated by adding the median income for a family of five and the median
income for a family of six, and dividing that sum by two. Affordable Purchase Price shall be
calculated with the assumption that the purchaser will pay a down payment equal to five percent
(5 %) of the total purchase price of the house (inclusive of the City Second Loan amount).
Affordable Purchase Price shall be calculated based on the above formula, and will not vary based
on the actual household income of the purchasers of individual houses. The following is a
worksheet of how to calculate Affordable Purchase Price:
For a two bedroom house, monthly housing costs may not exceed l/12 of 30% x 80% of
San Diego County Median Income for a family of 3.5 (currently $46,175), or $924.
For a three bedroom house, monthly housing costs may not exceed l/12 of 30% x 80% of
San Diego County Median Income for a family of 5.5 (currently $54,450), or $1,089.
Monthly Housing Costs include:
a. Mortgage Principal and Interest
b. Private Mortgage Insurance
C. Property Taxes
d. Fire/Casualty Insurance
e. Property Maintenance
f. Utilities Allowance
g. Homeowner’s Association Fees
529442.4Vgo&i22782.0009
12l29197 EXHIBlT “B”- 1
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1666
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Example No. 1: Two Bedroom House
For example, in the following situation, for a 2 bedroom House, assuming a 7% interest rate,
based on 1997 median income figures, the maximum loan amount would be $90,936:
a.
b.
c.
d.
e.
f.
Mortgage Principal and Interest $
Private Mortgage Insurance $
Property Taxes $
(Mello-Roos) $
Fire/Casualty Insurance (included in HOA) $
Property Maintenance (included in HOA) $
Utilities Allowance $
605
0
130
54
0
0
35
ii5 Homeowner ’ s Association
TOTAL: $ 924
In the above situation, if the market purchase price was determined to be $130,000, and the buyer
made a 5% down payment, the purchase price would be payable as follows: (a) first mortgage loan
of $90,936, plus (b) down payment of $6,500, plus (c) City Second Loan of $32,564. The City
Second Loan will not result in cash to Olson. It will take the form of a seller carryback loan to the
homebuyer, which will be assigned to the City, $10,800 of the City Second Loan will be credited
against the balance of the “City Loan” amount payable by the Developer to the City. The amount
of the City Second Loan will be equal to the “Primary Affordability Subsidy” under Section 2.4.2
of the Affordable Housing Agreement and is not actually paid to the Developer or the buyer.
These figures are for illustration only, and are subject to change. The actual figures used and the
final calculations are subject to review and approval by the City Housing and Redevelopment
Director pursuant to Section 2.4.1 of the Affordable Housing Agreement.
529442.3Ugoetzl22782.QQQ9
12/24/97 EXHIBIT “B’‘-2
. . 1667
Example No. 2: Three Bedroom House
For example, in the following situation, for a 3 bedroom House, assuming a 7% interest rate,
based on 1997 median income figures, the maximum loan amount would be $112,73 1:
a.
b.
C.
d.
e.
f.
Mortgage Principal and Interest $
Private Mortgage Insurance $
Property Taxes $
(Mello-Roos) $
Fire/Casualty Insurance (included in HOA) $
Property Maintenance (included in HOA) $
Utilities Allowance $
750
0
150
54
0
0
35
tic Homeowner’s Association
TOTAL: $ 1,089
In the above situation, if the market purchase price was determined to be $150,000, and the buyer
made a 5 % down payment, the purchase price would be payable as follows: (a) first mortgage loan
of $112,731, plus (b) down payment of $7,500, plus (c) City Second Loan of $29,769. The City
Second Loan will not result in cash to Olson. It will take the form of a seller carryback loan to the
homebuyer, which will be assigned to the City. $10,800 of the City Second Loan will be credited
against the balance of the “City Loan” amount payable by the Developer to the City. The amount
of the City Second Loan will be equal to the “Primary Affordability Subsidy” under Section 2.4.2
of the Affordable Housing Agreement and is not actually paid to the Developer or the buyer.
These figures are for illustration only, and are subject to change. The actual figures used and the
final calculations are subject to review and approval by the City Housing and Redevelopment
Director pursuant to Section 2.4.1 of the Affordable Housing Agreement.
529442.3UgoetzD2782.OQQ9
12/24/97 EXHIBIT “By’-3
1668 -
GOVERNMENT CODE 27361.7 II
I CERTIFY UNDER PENALTY OF PERJURY THAT THE NOTARY SEAL ON THE
DOCUMENT TO WHICH THIS STATEMENT IS ATTACHED READS AS FOLLOWS:
Name of the Notary:
Commission Number: \ \ 5401 Date Commission Expires: I\ -b-,lm
County Where Bond is Filed:
.
Manufacturer or Vendor Number: rshf#T\
(Located on both sides of the notary seal border)
Signature: w- . .
Firm Name (if applicable) \
* c....
Place of Execution: San Diem, CA Date: 1998
.
L Rec. Form tlR 10 (Rev. 7/961