HomeMy WebLinkAbout1997-12-02; City Council; 14454; APPLICATION TO PURCHASE AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA PROJECTe B iif %
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‘-iB# ILjl TITLE: APPLICATION TO PURCHASE
\IITG. /a-J- 97 AFFORDABLE HOUSING CREDITS IN THE VILLA
LOMA PROJECT
IEPT. H/RED
RECOMMENDED ACTION:
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CITY OF CARLSBAD -A&A BILL 74
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ADOPT Resolution 97 - ?# as recommended by the Housing Commission, APPROVING a request by
Catellus Residential Group to purchase 16.24 Affordable Housing Credits in the Villa Loma Project in order
to satisfy the affordable housing obligation of the Ocean Bluff project under the City’s lnclusionary Housing
Ordinance.
ITEM EXPLANATION:
The Ocean Bluff project is a 92 unit, single family residential development on 31 acres. The tentative map
(CT93-09) application has been approved by the Planning Commission. The project will include homes of
upwards of 3,000 square feet on parcels ranging from 7,500 to 13,000 square feet. The applicant is
requesting to purchase affordable housing credits in the Villa Loma Project to satisfy the project’s 16.24
unit inclusionary housing obligation. The City Council is the approval body for the purchase of affordable
housing credits.
The Ocean Bluff project has two potential options in satisfying its’ inclusionary housing obligation. The
project could potentially construct an on-site affordable units or purchase credits. The applicant previously
received approval for Site Development Plan SDP93-07 for a 16-unit affordable apartment project.
However, the developer has since concluded that the construction of the on-site affordable project is
financially unfeasible.
The City Council has adopted Policies 57 & 58 that govern the sale of affordable housing credits. The
policies examine the feasibility of an on-site proposal, the advantages and disadvantages of an off-site
proposal, and whether the off-site project advances the City’s housing goals and strategies. In reviewing
the applicant’s request, both the Housing Commission and staff have utilized the criteria contained in
Policies 57 & 58 in making their recommendation.
The Ocean Bluff Project was before the Housing Commission on three occasions. At the conclusion of the
first meeting, the Commission requested that staff prepare a report projecting the inclusionary housing
requirements of undeveloped property within the Southwest Quadrant of the City (See Attachment 2 -
September 11, 1997 Staff Report). The Commission requested this information to determine if there are
adequate credits available to future residential projects. The report determined there are in fact adequate
remaining credits.
At the conclusion of the September meeting, the Commission requested that the applicant provide updated
financial information on both the proposed apartment project and a potential for sale condominium project
City (See Attachment 2 - October 23, 1997 Staff Report). The Commission requested the updated
information to better analyze the applicant’s statement that the project was financially unfeasible. The
information determined that the rental project would require a financial subsidy of approximately $60,000
per unit while the for-sale project would require an approximately $50,000 subsidy. After reviewing all the
information, the Housing Commission’s recommended the project be allowed to purchase credits in the
Villa Loma Project.
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FISCAL IMPACT:
The Affordable Housing Credit is currently $32,220 per unit. The purchase of 16.24 credits will result in a
payment of $522,928 to the City’s Housing Trust Fund.
EXHIBITS:
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3.
City Council Resolution No. q 3 - 70 3
Staff Reports to the Housing Commission dated, August 14, 1997 w/attachments, September 11,
1997 w/ attachments, and October 23, 1997, with attachments.
Housing Commission Minutes from meeting of August 14, 1997, September 11, 1997, and October
23, 1997.
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CITY COUNCIL RESOLUTIC- o NO. 97- 703
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CARLSBAD, CALIFORNIA, APPROVING A REQUEST BY CATELLUS
RESIDENTIAL GROUP TO PURCHASE 16.24 AFFORDABLE HOUSING
CREDITS IN THE VILLA LOMA PROJECT IN ORDER TO SATISFY THE
AFFORDABLE HOUSING OBLIGATION OF THE OCEAN BLUFF
PROJECT UNDER THE CITY’S INCLUSIONARY HOUSING
ORDINANCE.
APPLICANT: Catellus Residential Group
CASE NO: CT 93-09,
WHEREAS, Catellus Residential Group has received approval of
Tentative Map CT 93-09 for the development of a 92 unit residential
development;
WHEREAS, Catellus Residential Group has received a recommendation
of approval from the Housing Commission that the City Council approve the
purchase of 16.24 affordable housing credits in the Villa Loma Project to satisfy
the inclusionary housing requirement of Tentative Map CT 93-09;
WHEREAS, the City Council did hold a public meeting to consider said
request for the purchase of Affordable Housing Credits by Catellus Residential
Group;
WHEREAS, at said public meeting, upon hearing and considering all
testimony, if any, of all persons designing to be heard, said Council considered all
factors relating to the application and request to purchase Affordable Housing
Credits:
NOW, THEREFORE, BE IT HEREBY RESOLVED by the City
Council of the City of Carlsbad, California, as follows:
That the above recitations are true and correct.
The project is consistent with the goals and objectives of the City of Carlsbad’s
Housing Element and Comprehensive Housing Affordability Strategy, the
Inclusionary Housing Ordinance, and the Carlsbad General Plan.
Based upon the analysis contained within the City Council Staff Report and
Housing Commission Staff Reports, the City Council finds that the off-site
satisfaction of the inclusionary housing requirement is in the public interest.
That based on the information provided within the City Council Staff Report and
the Housing Commission Staff Report and testimony presented during the public
meeting of the City Council, the City Council hereby APPROVES a request by
Catellus Residential Group to purchase 16.24 affordable housing credits in the
Villa Loma Project in order to satisfy the affordable housing obligation of the
Ocean Bluff project under the city’s inclusionary housing ordinance.
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5. That the City Council hereby authorizes the City Manager or his designee to
execute the Affordable Housing Agreement in substantially the form presented to
I the City Council as Exhibit 3 of the Housing Commission Staff Report dated
August 14, 1997 and to execute such other documents, or take other actions as
may be necessary or appropriate to assist the developer in acquiring the
Affordable Housing Credits.
4 PASSED, APPROVED, AND ADOPTED at a regular meeting of
5 the City Council of the City of Carlsbad, California, held on the 2 nd day of
December , 1997 by the following vote, to wit:
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II AYES: Lewis, Kulchin, Finnila, Nygaard & Hall
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NOES: None
ABSENT: None
ABSTAIN:
15 II ATTEST:
wCLAUDE A. LEWIS , Mayor
18 ALETHA L. RAUTENKRANZ, City C&k
19 (SEAL)
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Attachment No. 2
Staff Reports to the Housing Commission:
August 14,1997
September 11,1997
October 23, 1997
The City of Carfsbad Rousing & Redevelopment Department
A REPORT TO THE HOUSING COMMISSION
Item No. 3
Stafl Craig D. Ruiz
Managemen: t Analyst
DATE: OCTOBER 23,1997
SUBJECT: CT 93-09 - OCEAN BLUFF - APPLICATION TO PURCHASE
AFFORDABLE HOUSING CREDITS IN THE VILLA LOMA HOUSING
PROJECT
I. RECOMMENDATION
That the Housing Commission ADOPT Resolution No. 97-010, recommending that the City
Council APPROVE a request by the Ocean Bluff Partnership to purchase 16.24 AffordabIe
Housing Credits in the Villa Loma housing project in order to satisfy the affordable housing
obligation of the Ocean Bluff development under the City’s Inclusionary Housing Ordinance.
II. PROTECT BACKGROUND
This item was originally before the Housing Commission at their August 14,1997 meeting. The
Commission continued the item to the September 11,1997 meeting and directed Staff to provide a
report projecting the inclusionary housing requirements of undeveloped property within the
Southwest Quadrant of the City. The report was to also examine if the projected development of
the Quadrant could result in a demand for the purchase of off-site credits which exceeds the
number of available credits. The report indicated that there are sufficient excess units to meet the
potential demand of the Southwest Quadrant.
The item was again continued at the September 11,1997, meeting and the Commission directed
the applicant to provide updated financial information on both the proposed apartment project
and a potential for sale condominium project. In addition, the applicant was directed to contact
additional non-profit agencies regarding potential participation in the project.
III. DISCUSSION
The applicant has provided both a rental and for sale proforma (Aftnchments 2 & 3) which
analyzes the finances of the 16 unit project. In March of 1995, the developer prepared a
preliminary proforma on the rental project. The analysis was based on the assumption that the
developer would contribute a fully constructed building pad for the affordable project. The
proforma was preliminary and did not include a detailed examination of all development and
operational costs. The March 1995 proforma estimated that the project would require a total City
subsidy of $362,000, or an average of $22,700 per unit.
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CT 93-09 - OCEAN BLUFF
OCTOBER 23,1997
PAGE 2
As requested by the Commission, the applicant has prepared an updated proforma. The current
proforma assumes that there will be a 4% tax credit equity investment, a conventional first trust
deed loan, a City loan and a developer land contribution. Based upon these assumptions, the
proforma estimates that there is a $959,000 financing gap that is proposed to be bridged by a City
loan. This loan would be approximately $60,000 per unit.
In addition, a proforma analyzing the cost of a for sale project was also prepared. The for sale
proforma is based upon the development of eight, two-bedroom and eight, three-bedroom homes
which would be sold to families earning 80% of the area median income. The proforma shows an
estimated shortfall of $805,000, or $50,000 per unit, which would be bridged through a City loan.
The City and developer assistance, plus a percentage of property equity would be recaptured by
the City through the resale of the homes on the open market.
As directed by the Commission, the developer contacted one additional non-profit group about
the possibility of developing the project. The developer contacted Community Housing of North
County (CHNC). CHNC stated that, due to the small size of the project, they would not be
interested in developing the project. Staff is unaware of other area non-profits that could be
contacted by the developer regarding this project.
Included in the August 14, 1997 Housing Commission staff report was an analysis of the
applicants request to purchase affordable housing credits as required by City Council Policy 57 &
58. In that report, staff relied on the financial information contained in the 1995 proforma. At
that time, it was staff’s opinion that there was adequate justification to support the request to
purchase credits. Further, it was staff’s belief that the requested City financial assistance of over
$22,000 per unit was not a financially prudent use of the City’s Housing Trust Fund when
compared to previous City gap assistance of $5,000 to $10,000 to construct affordable housing
units. The current proposed assistance amount of $50,000 to $60,000 further solidifies staff’s
position on this issue.
As requested, the applicant has provided additional financial information to the Housing
Commission to support their request to purchase credits in the Villa Loma project. Also, the
applicant has shown that there appears to be adequate affordable housing credits for potential
housing development in both the Southeast and Southwest Quadrants. With the additional
information provided to date, staff believes that the applicant has shown that the project would
not be financially feasible. Therefore, it is staff’s recommendation that the request to purchase
credits be recommended for approval by the Housing Commission to the City Council.
EXHIBITS
1. Housing Commission Resolution No. 97-010
2. Housing Commission Staff Reports dated August 14 and September 11,1997
3. Rental Proforma
4. For-sale Proforma
The City of CarJsbad Rousing & Redevelopment Department
A REPORT TO THE HOUSING COMMISSION
Item No. 1
Sta# Craig D. Ruiz
Management Analyst
DATE: SEPTEMBER 11,1997
SUBJECT: OCEAN BLUFF - APPLICATION TO PURCHASE AFFORDABLE
HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT
I. RECOMMENDATION
That the Housing Commission ADOPT Resolution No. 97-010, recommending that the City
Council APPROVE a request by the Ocean Bluff Partnership to purchase 16.24 Affordable
Housing Credits in the Villa Loma housing project in order to satisfy the affordable housing
obligation of the Ocean Bluff development under the City’s Inclusionary Housing Ordinance.
II. PROJECT BACKGROUND
This item was before the Housing Commission at their August 14, 1997 meeting. The
Commission continued the item and directed Staff to provide a report projecting the inclusionary
housing requirements of undeveloped property within the Southwest Quadrant of the City. The
report was to also examine if the projected development of the Quadrant could result in a demand
for the purchase of off-site credits which exceed the number of available credits.
III. DISCUSSION
The City is divided into 23 Facility Management Zones. Within the Southwest Quadrant, there
are 11 Zones (See Exhibit “2”). Staff has reviewed the existing and potential future land uses
within each zone to determine the development potential for the entire Quadrant.
As detailed on the attached chart (See Exhibit “3”) within each zone, the property owner,
approval date of the project, total number of approved/potential units, the number of inclusionary
units required, and method of satisfying the inclusionary requirement have been identified.
Projects of less than 7 units, which are eligible to pay an in-lieu fee as opposed to developing
inclusionary units, have been determined to have no inclusionary housing obligation for the
purposes of this report.
Of the eleven zones, five have no future inclusionary requirements. Zones 3,4, 5,6 and 13 have
either been previously developed or have a non-residential land use designation. With respect to
H:\word\Ocean Bluff HCRPT2
Zone 9, the undeveloped land consists of the Kaiza Poinsettia Development. This project has
satisfied their inclusionary obligation through their participation in the Laurel Tree project.
Zone 19 is comprised primarily of the Aviara development. The inclusionary requirement for
Aviara has been satisfied through the development of the Villa Loma project or will be satisfied
on-site in future phases of the development. Zone 23 is currently proposing to satisfy their
inclusionary obligation through the development of an on-site project.
Thus, Zones 20,21 and 22 contain the remaining undeveloped land which may result in an
inclusionary housing obligation at some future date. Using the growth control management point
obtained from the City’s Growth Management Ordinance, there exists a maximum development
potential of 1,148 residential units within the Southwest Quadrant. The development of 1,148
units will result in an inclusionary housing requirement of 172 affordable housing units,
There are two combined inclusionary housing projects in the Southwest Quadrant which contain
176 excess affordable housing credits. These projects include Villa Loma, which contains 159
credits and Laurel Tree, which contains 17 credits (based on information provided to staff to
date). With a build-out projection of 172 inclusionary units and an existing supply of 176 units,
there exists the potential for a surplus of 4 inclusionary housing credits.
Based upon staffs above projections, the current supply of 176 affordable housing credits will be
sufficient to meet the needs of the Southwest Quadrant at build-out. In addition, based upon the
information presented at the August 14, 1997 Housing Commission meeting, it is staffs opinion
that adequate justification exists to make the finding that the off-site satisfaction of the
inclusionary housing requirement is in the public interest. Therefore, staff is recommending that
the request to purchase credits be recommended for approval by the Housing Commission.
EXHIBITS
1. Housing Commission Staff Report of August 14, 1997
2. Southwest Quadrant Facility Management Zones
3. Affordable Housing/Market Rate Housing Spreadsheet
4. Zone 20 Property Ownership
H:\word\Ocean Bluff HCRPT2
.---\ - - @c-J EXHIBIT 1
The City of Cmfsbad Housing & Redevelopment Department
A REPORT TO THE HOUSING COMMISSION I
DATE: AUGUST 14,1997
Staj? Craig D. Ruiz
Management Analvst
Continued to 9/l l/97
SUBJECT: OCEAN BLUFF - APPLICATION TO PURCHASE AFFORDABLE
HOUSING CREDITS IN THE VILLA LOMA HOUSING PROJECT
I. RECOMMENDATION
That the Housing Commission ADOPT Resolution No. 97-010, recommending that the City
Council APPROVE a request by the Ocean Bluff Partnership to purchase 16.24 Affordable
Housing Credits in the Villa Loma housing project in order to satisfy the affordable housing
obligation of the Ocean Bluff development under the City’s Inclusionary Housing Ordinance.
II. BACKGROUND
The applicant, Ocean Bluff Partnership, has received approval for a tentative map (CT 93-09) to
develop 92 single family homes on approximately 31 acres. The project will include homes of
upwards of 3,000 square feet on parcels between 7,500 and 13,000 square feet. The subdivision
is required to provide 16.24 units of housing affordable to lower income households as required
by the City’s Inclusionary Housing Ordinance. To satisfy this requirement, the developer has
also received approval of Site Development Plan SDP 93-07 for the development of a 16 unit
affordable multi-family apartment project.
When CT 3-09 was approved by the City Council, a condition of approval for the project allowed
for the developer, upon showing that an on-site contribution is not appropriate, to purchase
Affordable Housing Credits in the Villa Loma housing project. The developer believes that there
are significant constraints which preclude the development of an on-site affordable housing
project. Therefore, the developer is requesting to purchase Affordable Housing Credits
(“credits”) in the Villa Loma project in lieu of on-site construction.
The City’s Inclusionary Housing Ordinance permits off-site satisfaction of an inclusionary
requirement through participation in a Combined Inclusionary Housing Project (“Combined
Project”) if the City Council determines that it is in the public interest. Purchase of credits in the
Villa Loma project constitutes participation in a Combined Project.
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OCEAN BLUFF
AUGUST 14,1997
PAGE 2
Policies Regarding Off-Site Proiects and Purchase of Affordable Housing Credits
The City Council has adopted two policies which deal with off-site or Combined Projects and the
sale of Affordable Housing Credits. Council Policy 57 was developed to establish the criteria to
be utilized in order to make the necessary finding that off-site satisfaction of an inclusionary
housing requirement, when proposed through a Combined Project, is in the public interest. This
policy requires review of the request and an action recommendation from the Combined Project
Review (Staff) Committee consisting of the Housing and Redevelopment Director, City
Manager, Financial Management Director, Community Development Director, Planning Director
and City Attorney. The Mayor is an ex-officio member of the Committee. This committee has
reviewed the subject request and is recommending approval.
Council Policy 58 was established to determine the price of credits and the mechanism to satisfy
a developers obligation under the City’s Inclusionary Housing Ordinance. Based upon this
policy, the current cost to purchase a credit in the Villa Loma project is $32,220. The Ocean
Bluff Project, therefore, will be required to pay to the City of Carlsbad a total of $523,252, if
approved by the City Council.
RECOMMENDATION
The Council Policies require staff to evaluate the request for off-site satisfaction of the
inclusionary housing obligation and the purchase of credits based upon three primary criteria.
The criteria includes: 1) feasibility of on-site proposal; 2) relative-advantages/disadvantages of an
off-site proposal; and 3) the advancement of housing goals and strategies. The following is a
summary of staffs analysis of the criteria for the project.
Feasibilitv of On-site Proposal
l The small scale of the affordable housing project makes the development
economically unfeasible due the significant financial subsidy which would be
required for the project. Further, the small scale of the affordable housing project
makes it unlikely that the project will generate interest from funding sources.
l It will be difficult to integrate an affordable housing apartment project into an a
community of single family detached homes which have an estimated base price
range of $300,000 to $350,000.
Relative AdvantaPes/Disadvantapes of an Off-site Proposal
l The participation in the off-site project will allow the City to recover the costs
associated with the development of excess affordable housing units.
l The Villa Loma project has locational advantages over the on-site project in terms of
direct access to jobs, public transportation, schools, parks as well as other amenities
and services due to the being located directly on a major thoroughfare.
OCEAN BLUFF
AUGUST 14,1997
PAGE 3
Advancirw Housing Goals and Strategies
l The recovery of the City’s investment in the Villa Loma Project will provide for
additional financial resources which are needed to further affordable housing
development in the community.
Based upon the analysis of the above criteria, it is staffs opinion that adequate justification has
been provided to make the finding that the off-site satisfaction of the inclusionary housing
requirement is in the public interest. Therefore, staff is recommending that the request to
purchase credits be recommended for approval by the Housing Commission.
EXHIBITS
1. Housing Commission Resolution No. 97-O 10
2. Applicant Request to Purchase Credits
3. Draft Affordable Housing Agreement
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OCEAN BLUFF F’ARTNE;SW
7825 Fay Avenue, Suite 200
La Jolla, California 92037
(619) 456-3594
July 15, 1997
Mr. Evan Becker
Housing and Redevelopment Director
City of Carlsbad
2965 Roosevelt Street, Suite B
Carlsbad, CA 92008
Subject: Ocean Bluff Project -- Request to Purchase Affordable Housing Credits in the
Villas at El Camino Real Project
Dear Mr. Becker: 2:
This letter serves as a formal request by the Ocean Bluff Partnership to purchase off-site
affordable housing credits in the Villas at El Camino Real development to satisfy the Ocean Bluff
(CT 93-09) project’s inclusionary housing obligations. This request is made as a part of final map
processing activities. The request is in compliance with and is specifically supported by the
following actions previously taken by the City Council:
The City’s lnclusionary Housing Ordinance (CMC Chapter 21.85) establishes certain
requirements under which residential developers must provide housing that is affordable to
lower-income households as a condition of project approval and permit issuance. The
ordinance provides that “circumstances may arise in which the public interest would be
served by allowing some or all of the inclusionary units associated with one project site to
be produced at an alternative site or sites.”
Planning Commission Resolution 3869, CT 93-09, .conditions also provide that “a second
inclusionary housing option available to the developer shall be that the developer shall
enter into an agreement with the City to purchase affordable credits from Villas at El
Camino Real or participate in an off-site combined inclusionary project within the
southwest quadrant and as appropriate, in accordance with the requirements set forth in
Chapter 21.85 of the Carlsbad Municipal Code, the Zone 20 Specific Plan, and City
Council Policies 57 and 58 dated September 12, 1985”.
In the case of the Ocean Bluff project, there are particular circumstances that warrant the provision
of the inclusionary units off-site in combination with the existing Villas at El Camino Real
Apartment project or other suitable location, pursuant to Council Policy 57 criteria. Significant
feasibility issues affect the development of this project on-site. Contribution to the existing off-site
project versus providing a small low-income apartment complex on-site will result in increased
public benefit.
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We understand this request will be evaluated by a staff Project Review Committee to determine
compliance with the criteria defined in Policies 57 and 58. We will then take the Committee’s
recommendation to the Housing Commission and City Council. As you know, we hope to expedite
the process to Council since this issue must be resolved precedent to recording the final map.
Please call if you need additional information or if we may be of any other assistance.
Mr. Robert Wineteer
cc: Mr. Jack Henthorn, Jack Henthorn & Associates
OCEAN BLUFF PROJECT
OFF-SITE AND COMBINED INCLUSIONARY HOUSING PROJECT
ASSESSMENT WORKSHEET -- BACKGROUND
The following background information is provided to assist you in your assessment.
1. Owner/Applicant Information:
Ocean Bluff Partnership
Attn: Mr. Robert Wineteer
7825 Fay Avenue
Suite 200
La Jolla, CA 92137
456 3594
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Applicant’s Representative:
Jack Henthorn & Associates
Attn: Mr. Jack Henthorn
Suite J
5431 Avenida Encinas
Carlsbad, CA 92008
438-4090
2. Off-sitelCombined Project Name:
VILLAS AT EL CAMINO REAL APARTMENTS
3. Description of Project with lnclusionary Housing Obligation:
Ocean Bluff, CT 93-09, is a proposed 92-lot single family development located on a 31.2-acre
parcel with a 16.24-unit affordable housing obligation.
4. On-site Affordable Housing Description:
Ocean Bluff Affordable Housing, SDP 93-07, is a 16-unit multi-family, apartment project on one
lot with units ranging from 1 to 3 bedrooms. The units would range in maximum rent from
approximately $450 to $600, which is affordable to households earning incomes of 50% to
80% of the Area Median Income. To achieve feasibility, the project would require a subsidy of
$362,737 (even assuming a fully constructed pad is provided by the developer and unit
incomes are based on a 95% occupancy rate factor) .
5. Proposed Off-site Project Description:
The Villas at El Camino Real project is a 344-unit apartment development in which all units are
restricted and affordable to households with incomes not exceeding 60% of the San Diego
County Median. Villas at El Camino Real was developed by La Terraza Associates, with
Bridge Housing Corporation as the Managing General Partner. The complex contains 1, 2, 3 &
4 bedroom units.
Villas at El Camino Real was financed with assistance from the City of Carlsbad and the
Carlsbad Redevelopment Agency. The assistance was structured in such a way as to create
affordable units which would be marketed exclusively by the City to “other developers” in order
to satisfy an affordable housing obligation. Villas at El Camino Real Apartments is a Combined
Project according to the lnclusionary Housing Ordinance, and developers may participate in
this as an “off-site” method of satisfying their affordable housing obligation. (This is also an
approved site as per Specific Plan Amendment #203 for the Costa Do Sol project, currently
called Greystone Cove.)
Participation in Villas at El Camino Real Apartments by the applicant would be in the form of a
purchase of Affordable Housing Credits (Credits) under terms established by City Council
Policies Number 57 and 58. If the applicant is afforded the opportunity to purchase Credits,
the Ocean Bluff tentative map would require the purchase of 16.24 Credits to satisfy its
inclusionaty housing requirement. s
6. Description of On-site Project Constraints:
Specific constraints exist which would affect the on-site affordable project’s feasibility. These
include the uneconomical scale of the affordable project and a the significant price difference
between the affordable rental units and the proposed single-family market units that will be
developed in and around this project.
In addition to these constraints, the location of the Villas at El Camino Real project is superior
to the on-site location. Access from the subject site to nearby jobs, shopping, transportation,
schools, parks, bus stops and other services and amenities to the north and east will be
limited. Direct routes will not be available to nearby Palomar Airport Road and El Camino Real
until well after the units are constructed. Contrary to this, the Villas at El Camino Real project is
already conveniently located with direct access onto El Camino Real, providing convenient
access to needed services and jobs.
OCEAN BLUFF PROJECT
OFF-SITE AND COMBINED INCLUSIONARY HOUSING PROJECT
ASSESSMENT WORKSHEET --WORKSHEET
1. Feasibility of the On-site Proposal
a. Are there significant feasibilitv issues due to factors such as project size, site constraints,
amount and availability of required subsidy, and competition from multiple projects that make an
on-site option impractical?
l The on-site affordable project is of marginal size as an apartment project. Given the small size of the
project and its restricted rental structure, on site management and maintenance will be difficult.
l The market units in this project would be required to absorb over $5700 per unit so that land
development costs could be contributed. This figure would rise to over $9600 per unit if the applicant
is required to build the units on site and close the post land development gap of $362,737.
4 Based on the estimated restricted rental prices of the affordable units the applicant will be facing an
average subsidy requirement of approximately $22,700 per unit, beyond land contributions. This
would result in each unit being subsidized with over $55,000.
b. Will an affordable housing product be difficult to inteqrate into the proposed market development
because of significant price and product type disparity?
l Price disparities will be substantial between the low-income rental apartment units restricted at $450-
600 rent and the approved higher-end single-family, detached product with an estimated base price
range of $300,000 t0 $350,000.
l The integration of 16 affordable apartment units, sized at 600 to 1,000 sq. ft., into the single-family
subdivision with homes over 3,000 square feet on 7,500 to 13,000 sq. ft. lots will result in major
product type disparity on-site. The surrounding area will also be built-out with low density, single-
family detached products consistent with the existing RLM land use designation and market demand.
The on-site project would, therefore also result in substantial product disparity with the surrounding
region.
c. Does the on-site development entity have the capacitv to deliver the proposed affordable housing
on-site?
l The applicant is not experienced in the development of affordable housing.
l Affordable housing developers have advised the applicant that it is unlikely that this size of project will
generate interest from funding sources.
2. Relative AdvantaneslDisadvantaqes of the Off-site Proposal.
a. Does the off-site option offer greater feasibilitv and cost effectiveness than the on-site alternative,
particularly regarding potential local public assistance?
l Villas at El Camino Real is built and has proven its feasibility; no additional assistance is required.
l Nearly 500 affordable units have been recently completed or are in process of approvals in the
southwest quadrant. It is possible that affordable unit production could outpace market development.
l The applicant’s participation in Villas at El Camino Real would permit the intended recovery of City
investment provided to the project through utilizing “excess units”. These funds could then be used
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to provide additional affordable housing. Conversely, the developer’s on-site project would create the
demand for additional new subsidy.
. The small size of the on site project could result in additional future subsidy requests related to
operating costs.
b. Does the off-site proposal have location advantages over the on-site alternative, such as
proximity to jobs, schools, transportation, services; less impact on other existing developments,
etc.?
. The Villas at El Camino Real location has advantages over the on-site project in terms of direct
access to jobs, public transportation, schools, parks, as well as, other amenities and services due to
being located directly on the major thoroughfare, El Camino Real.
l Villas at El Camino Real is a self-contained affordable development in an area designated for higher
density residential development such as condominiums and townhomes.
l The on-site proposal could be a source of land use conflicts that typically occur when higher density
development is permitted adjacent to larger lot single family development.
c. Does the off-site option offer a development entity with the capacitv to deliver the proposed
project?
l The Villas at El Camino Real project is an existing project, developed and managed by a highly
experienced and specialized affordable housing developer.
d. Does the off-site option satisfy multiple developer obliaations that would be difficult to satisfy
with multiple projects?
l Villas at El Camino Real project was originally established as a Combined Project, specifically to
address this purpose.
l The proposed on-site project would be one of several projects in the southwest quadrant competing
for scarce financial assistance. Villas at El Camino Real has already been financed and built and
thus, would not be competing for subsidy financing.
3. Advancing Housing Goals and Strateqy
a. Does the off-site proposal advance and/or support City housing goals and policies expressed in
the Housing Element, CHAS and lnclusionary Housing Ordinance?
General Plan Housing Element and CHAS Goals:
l Villas at El Camino Real Apt. affordable project is targeted to the highest priority need identified,
larger rental units for low income households.
l The recovery of City investment in Villas at El Camino Real through the applicant’s participation will
provide additional resources which are needed to assist further affordable housing development.
l Villas at El Camino Real provides a large quantity and diversity of affordable housing stock with its
344 units, including a generous supply of different size units to meet various housing needs of the
community.
lnclusionary Housing Ordinance Policies:
l Consistent with the City and public interests to use existing “excess” affordable units before
supporting additional new construction.
l In conjunction with the combined Villas at El Camino Real project, Ocean Bluff will provide for 15% of
the total units for affordable (lower income) residential units. The project also complies with the
lnclusionary requirements as contained in the Zone 20 Specific Plan and the General Plan Housing
Element.
6
I?
Growth Management Zone, Specific Plan (SP 203) Ord. No. NS-257 Guidelines:
. Villas at El Camino Real is coordinated with surrounding properties by providing direct access to a
major Circulation Element Roadway, El Camino Real, as well as circulation and pedestrian access to
public facilities.
l Villas at El Camino Real affordable housing product is consistent with the anticipated clustered multi-
family attached and stacked flat unit types identified in the Specific Plan. .
Planning Commission Resolution No. 3869, Case No. CT 93-09, approved by City Council:
l The offsite provision of inclusionary housing is consistent with Condition #22 which reads:
“Upon showing by the developer that an onsite contribution is not appropriate for the project, a
second inclusionary housing option available to the developer shall be that prior to final map
approval, the developer shall enter into an agreement with the City to purchase affordable credits
from Villa Loma or participate in an offsite combined inclusionary project within the southwest
quadrant and as appropriate, in accordance with the requirements set forth in Chapter 21.85 of the
Carlsbad Municipal Code, the Zone 20 Specific Plan, and City Council Policies 57 and 58 dated
September 12, 1985. Prior to City Council approval, the developer shall submit a signed Affordable
housing Agreement to the Housing and Redevelopment Director.”
7
AFFORDABLE HOUSING AGREEMENT
This AFFORDABLE HOUSING MITIGATION AGREEMENT, entered into
this day of ,I9 , by and between the
CITY OF CARLSBAD, a Municipal Corporation (hereinafter referred
to as the "City"), and OCEAN BLUFF PARTNERSHIP, (hereinafter
referred to as the "Developer"), is made with reference to the
following:
A. Developer is the owner and developer of property
generally located at the northwest corner of the future
Poinsettia Lane and Blackrail Court in the Zone 20 Specific Plan'
area and Locals Facilities Management Zone in the City of
Carlsbad, in the County of San Diego, California (hereinafter
referred to as the "subject property").. The subject property is
more particularly described in Exhibit "A", which is attached
hereto and is incorporated herein by this reference.
B. Developer wishes to construct 92 single family homes
upon the subject property. The City Council has approved Zone
Change ZC93-04, Local Coastal Plan Amendment LCPA95-09, Carlsbad
Tract/Parcel Map CT 93-09, Hillside Development Plan HDP 93-09
and the Planning Commission has approved Site Development Plan
SDP 93-07, for the proposed development. The City Council and
Planning Commission issued these approvals subject to conditions
of discretionary approval.
C. The Developer was conditioned with the ability to
satisfy its affordable housing obligation in accordance with
Chapter 21.85 of the Carlsbad Municipal Code by purchasing
sixteen and twenty four one-hundredths (16.24) Affordable Housing
2\
Credits (Credits) in the Villa Loma affordable housing project.
D. Pursuant to the above-referenced conditions of
approval, and in accordance with City Council Policies 57 and 58,
the Developer has received approval from the City Council by
Resolution No. 97- , dated ‘ 1997, to purchase Credits
in the off-site project known as Villa Loma. The City controls
and has available these Credits in Villa Loma and the project
meets the requirements of a Combined Inclusionary Housing Project
as defined in Chapter 21.85 of the Carlsbad Municipal Code.
Purchasing Credits according to the terms of this Agreement
satisfies the developer's affordable housing obligation in
accordance with Chapter 21.85 of the Carlsbad Municipal Code and
the developer's conditions of approval.
NOW, THEREFORE, it is mutually agreed by and between the
undersigned parties as follows:
1. SATISFACTION OF AFFORDABLE HOUSING OBLIGATION AND
CONDITIONS OF TENTATIVE MAP APPROVAL THROUGH THE
PURCHASE OF AFFORDABLE HOUSING CREDITS
Within sixty (60) days of the City Council approval of
Developer's request to purchase Affordable Housing Credits, and
prior to receiving Final Map approval, Developer shall execute
this Agreement and pay to' the City the sum of $ 523,252 as its
payment for sixteen and twenty four one-hundredths (16.24)
Credits. Execution of this Agreement by the parties and payment
of the sum of $ 523,252 to the City by the Developer shall fully
satisfy the Developer's affordable housing obligation pursuant to
Chapter 21.85 of the Carlsbad Municipal Code and the above-
referenced conditions of approval. Upon execution of this
Agreement and receipt of the above payment from developer, City
22
- h
will record an appropriate release of the developer’s obligation.
Failure of the Developer to perform according to the
terms of this Agreement will be a failure to satisfy the
Tentative Map Conditions with respect to the subject property and
Chapter 21.85 of the Carlsbad Municipal Code; and the City may
exercise any and all remedies available to it with respect to the
Developer's failure to satisfy the Tentative Map Conditions
including but not limited to withholding the issue of building
permits for the subject property.
2. CITY ACKNOWLEDGES DEVELOPER PAYMENT.
By executing this Agreement, City acknowledges receipt'
of Developer's payment under the terms of this Agreement.
3. DEVELOPER WAIVES RIGHTS TO OTHER METHODS OF SATISFYING
AFFORDABLE HOUSING OBLIGATION.
By executing this Agreement, developer waives any and
all rights to other means of satisfying the affordable housing
obligations required by Chapter 21.85 of the Carlsbad Municipal
Code and the conditions of approval.
4. HOLD HARMLESS.
The undersigned developer (hereinafter referred to as
"Indemnitor") , for and in consideration of the City of Carlsbad's
approval of this Agreement, and for other good and valuable
consideration, the receipt and sufficiency whereof is hereby
acknowledged by Indemnitor, does hereby covenant, undertake and
agree that it will indemnify and hold harmless (without limit as
to amount) the City of Carlsbad and its elected officials,
officers, employees and agents in their official capacity
(hereinafter collectively referred to as "Indemnitees"), and any
of them, from and against all loss, all risk of loss and all 23
damage (including expense) sustained or incurred because of or by
reason of any and all claims, demands, suits, actions, judgements
and executions for damages of any and every kind and by whomever
and whenever made or obtained, allegedly caused by, arising out
of or relating in any manner to this Agreement, and to protect
and defend Indemnitees, and any of them with respect thereto.
5. NOTICES.
All notices required pursuant to this Agreement shall be in
writing and may be given by personal delivery or by registered or
certified mail, return receipt requested, to the party to receive
such notice at the addresses set forth below:
TO THE CITY OF CARLSBAD:
City of Carlsbad
Housing and Redevelopment Department
Attn: Housing and Redevelopment Director
2965 Roosevelt Street, Suite B
Carlsbad, CA 92008-2389
TO THE DEVELOPER:
Ocean Bluff Partnership
Attn: Bob Wineteer
7825 Fay Avenue, Suite 200
La Jolla, California 92037
Any party may change the address to which notices are to be
sent by notifying the other parties of the new address, in the
manner set forth above.
-
6. INTEGRATED AGREEMENT.
This Agreement constitutes the entire agreement between the
parties and no modification hereof shall be binding unless
reduced to writing and signed by the parties hereto.
7. DURATION OF AGREEMENT.
This Agreement shall terminate and become null and void
when the City has received the payment described in Paragraph 1,
except as to the indemnity and hold harmless provisions setforth
in Paragraph 4.
8. SEVERABILITY.
In the event any limitation, condition, restriction, '
covenant, or provision contained in this Agreement is to be held
invalid, void or unenforceable by any court of competent
jurisdiction, the remaining portions of this Agreement shall
nevertheless, be and remain in full force and effect.
-
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the day and year first above
written.
DEVELOPER
Ocean Bluff Partnership
By: Signature
Print Name
Title: -
CITY OF CARLSBAD
A Municipal Corporation
By:
MARTIN ORENYAK
Community Development
APPROVED AS TO FORM:
RONALD R. BALL
City Attorney
Dir
EXHIBIT "A"
PROPERTY DESCRIPTION
Lot 3 in Section 22, Township 12 south, range 4 west,
San Bernardino base and meridian in the County of San
Diego, Sate of California, excepting therefrom those
portions thereof lying north of the south boundary line
of Ranch0 Agua Hedionda, as said south line was
established May 5, 1913, by decree of the Superior
Court of the State of California, in and for San Diego
County, in that certain action (No. 16830) entitled
Kelly Investment Company, a corporation, vs. Clarence
Dayton Hillman and Bessie Olive Hillman.
.*. -Vlll-
- f
PALOMAR AIRPORT ROAD
ISY Built-out or Non-Residential
* Affordable Housing Projects
YIYOFCARLSBAD
LOCALFACILITIES~AGEMENTZONES ~OUTHWESTQUAD~ r‘..j ot to .>ro e c- j
yellow = projects < 7 units
cream = pending/appr’vd/built
It.blue = proposing construct.
gold = existing combined prjct
Affordable Spreadsheet EXHIBIT 3
BUILT OUT/NON-RES
BUILT OUT/NON-RES 0.00
BUILT OUT/NON-RES 0.00
Kaka Poinsettia:
94-04 Al *
94-05A2’
94-06 A3 l
94-06 A4 l
94-08 Bl =
94-12 C withdrawn 28.00 ~~~~+~~~~ .““‘~~V.,..~....~~,~ ,.. . . . . . . . . . . . . *,:;l.... > .\:
BUILT OUT/NON-RES 0.00
Aviara Phase 1 * 329.00
1093.00
677.00
151.00
Broccato l CT8919
Murphy
Mtsuchi
449.00
l/8/91 72.00
. . . . . . . ,.~~ ..~ . ..<..< .~. .< v . . . . < .,... . . . . :i. .<. . . . . . . ..i . i..~~. . . ~~~~~~~~~~~~~~ ~~~~~~~~~ ~~~~~ ::..::.~ . . . . . .._.._... % ..,..... x%x . . . . . . . . ..> . . . . . . . . . . . . . . . . ..^ . < . . . . . . . . .
Aitchinson
Cardosa
Carnation
Cobblestone *
DeJong
Emerald Ridge:
East l
West’
Engler
Fernandez
Greystone Cove *
Hadley
Hildalgo
Kaiser
Kramer
Linn
Mar Vista l
Mariano l *
510196
8/l 3196
412196
3/l 9196
113196
Mendivil
Moore
Muroya
Nelson
Ocean Bluff l
Poinsettia Partners Roesch ( - )
412196
1
:: :
2
0
2
0
0
2
1
0
3
; 0
2
$0
0
0
c
4
8
3
9
I:
5
1.00 X
1.00 X
i’~:~~~~~ ~~~~~~~~~ :2...:.,. .,.,..,.... . . . . . . . . . . . I .A :. .A . ..A ‘... .:., 2 ,.: *
‘a0
.oo
0.00
7.00 4.00
.oo 0.00
6.00 3.90
.oo
a0
1.00
4.00
.oo
9.00
.w
7.00
.oo
a0
a0
.oo
2.00
a0
2.00 .oo
5.00
4.00
0.00
0.00
3.15
2.00
0.00
6.00
0.00
4.00
0.00
0.00
0.00
0.00
X
6.00
1.20
5.06
1.00
X
2.00
8.00
2
7
7
6 4
I
7
1
2
9 21
4
I!
9250.00
8975.00
6050.00
1425.00
0950.00
14075.00
8975.00
22850.00
3400.00
3600.00 6325.00
3875.00
57950.00
~~~
515.00
3060.00
2575.00
57180.00
?575.00
3060.00
7090.00
10 L.Tree
Affordable Spreadsheet Page1
-a
Affordable Spreadsheet yellow = projects < 7 units
cream = pending/appr’vdlbuilt
It.blue = proposing construct.
gold = existing combined prjct
Iudvalis
jambi l
San Dieguito
jarkaria
jchindler
iud. Int. Mission
jugino
rabata Trust
rabata N&E:
*hompson
‘hompson
‘hompson
;hom pson
Veidner
‘amamoto ..~.“~.:.,‘..““.~,;~,,~ ~~~~~~~~~~~ ?:.:.:.x.>:.:.> ..,.._ i.. L-u . . . . . . . . . ..r_ IL
Yestem Pacitic l
7eiter,Whitney,
jfregola.Bowen ( - )
ilaldonado
ions
;arlsbad Partners ( - )
Xy of Carlsbad
teiter .ohf
Jamikas
iudduth
cevane -
lesaska
iteiner
~ . . ,?. ,.:..w..:::~::::::::~:~~:.:.>:<.~.:.:, .,..,. . . .
rarious owner:
Ward and Lear
Devlin EdwardslRounsv’le
Tartaglia
Cambell
Alsop
Shugard
Donahue
Stanton
Wood
Bachman
Dickie and Berry
Hart
McCabe
‘allas / BUILT OUT
‘oinsettia Properties:’
was Lusk) :f97-1Q incomplt
:T97-11 PA 2
:T97-12 PA 4
II Coast Enterp.
Jeiss(1)
‘arious owners:
Pacific Riviera
Crowell and Smith
Schreiber
Cannon
7W.00 0.00
0.00 0.00
7.09 0.00
.,., ., ~~~~~~~ 0.00 0.00
106.00 106.00 16.00 310050.00
24.00 24.00 4.00 70200.00
23.00 23.00 3.00 67275.00
32.00 32.00 5.00 93600.00 16.00 16.00 2.00 46800.00 16.00 16.00 2.00 46800.00 . ., . ..y. .,,yy<.r,ry.. %.., ,.,> ~~i~~~~~~~~~~~~~~~~~~~ s. .n k. ._. . . . . . . . . . . _.,. > _...... ..A......%. . X...... . . . . . I.. A..... ..A.. . . . . ,..
160.00 0.00 0.00
24.00 24.00 4.00 70200.00
38.00 38.00 6.00 111150.00 38.W 38.00 6.W 111150.00
29.00 29.00 4.00 84825.00 I~~~~~~~~~ 0.00 . . . . . ..L....... . . . 0.00 . . ..__._........_ 84.00 84.00 13.00 245700.00 344.00
19.00 19.00 2.85 55575.00 75.00 75.00 11.25 219375.00 18.00 18.00 2.70 52650.00 15.00 15.00 2.25 43875.00
33.00 33.00 4.95 96525.00 :~~~:::r~~i~X~~~~~~ o w .,.. t .,._.,.,. ::::.::::::.,:.,,::,:,,:.:.:.:.:. . 0.00
12.00 12.00 1.80 35100.00 66.00 66.00 10.00 193050.00
.W
.W
.W
.oo
.27
2
4
3078.25
4255.25
1
:
2
2 1
i
i 1
1
1
z
i
:
2
2
2
2
27090.00
27090.00
22575.00
~~~~~~~~
722400.00
22575.00
m30.00
(
L438.10
Z438.10
E438.10
$876.20
‘314.30
!438.10
1876.20
1876.20
1876.20
3616.95
!438.10
t438.10 !438.10
12620.15
!2845.90
!4110.10
$@&~ .,... ;:.:.:.:.::;::;:;:
38.00
Affordable Spreadsheet Page2
30
yellow = projects < 7 units
cream = pending/appr’vd/built
It.blue = proposing construct.
gold = existing combined prjct
Affordable Spreadsheet
Addison 5959.60
Alcaraz 4469.65
Graben 4244.10
Fisher 2979.90
Dettmer 3973.20
Yanez 4966.50
60.00
Affordable Spreadsheet Page3
3\
-- EXHIBIT 4
, .,~y:;: ;:-.
g;; pY ,!.q;;:.‘;
.‘h. I,* “_”
1 :.g
)‘.,.‘r-.r.q~
,.5;‘: , “.Y -j
.:::“h-‘, ,-‘G* .s _ _ .: “,
..I,. g;g . g Y 3 :,gg 4 / $
-“’ . . . . .
: ) .<
,.( ‘.,
1 ” ,: :,,;.
33
- RENTAL PROJECT-
AFFORDABLE HOUSING ANALYSIS
OCEAN BLUFF APARTMENTS, CARLSBAD
FINANCIAL SUMMARY
OCTOBER 2,1997
Funding Sources & Uses
j Sources:
1 Tax Credit Investor Equity
Conventional Mortgage #l
AHP Loan
Redevelopment Loan - front end
HOME Loan
DeveloperLoan
) Construction Period Revenues
1 Developer Loan
Deferred Developer Fee
Catellus Land Contribution
I
Total Sources
$1,241,441 j
117,086
0;
959,000 j
01 Oi 2,400
0
01
Uses:
Property Acquisition - Land
Property Acquisition - Imprmnts
Hard Construction Costs A&EJLegaYConsultants
Permits & Fees
Developer Fees
I Reserve Funds
/ Marketing/Models/Office
1 Financing & Other Soft Costs
! 252,083 1
180,540 /
1,304,725
201,607
300,236 !
160,000 /
24,000 i
40,000 )
190,254
99,105:
$2,752,550 j
Financial Structure
Construction Loan
I Amount f I .358,600
Lender:
Term:
Security:
to-be determined
19 months
First Trust Deed
r
Recourse: 50% Repayment Guarantee, Completion
Guarantee, Environmental Indemnity
Conventional Mortgage Loan
Amount: %I 17,086
Issuer: Conventional Mortgage Lender
Security: First Trust Deed
Term: 30 years
LTV: 75.0%
DSC: 1.25 x
Interest Rate: 9.500%
Cap Rate: 8.50%
Credit Enhancement
Credit: Not Applicable
Term:
Spread:
LTV:
DSC:
Resourse:
Rating:
10/03/97
:conomics
Year
Year
Year
Net Operating Income
NOI after 1stTD Debt Service
Net Income(Loss)
/ S 14.780
$0’
(596,253j
Developer Fees S160,OOO
Contract Mgmt Fees S77.000
Year 1 Ground Lease Income 0
Year 1 Loan Debt Service 0
Year 1 Partnership Management Fee 0
Year 1 Distributions 0;
Tax Credits
Amount:
Investor:
Pay-in Date:
Recourse:
$1,241,441 .I
to be determined
100% occupancy on low income units, 1 I
and 1.25 x Debt Service Coverage 1
30 month Operating Defecit Guarantee 1
Buy-out: Equal to Investor’s tax liability
1 Housing Set-Aside
Amount: $959,000 Source: City Redevelopment Agency
Pay-in Date: Commencement of Construction
Recourse:
Special terms:
100% to partnership upon failure to
maintain affordability
none
Other Amount:
Pay-in Date:
Term:
SO
Interest Rate:
Security:
i
: :” zc f
!
: k .
: .* : qc
z
c ” v
a c 7
; :”
SC F
c (I w
: k
g :” if
E
ii
i SC :
‘5 P
t; m
c I
i
a
5
I
?
c 1 I
2 5
a
:
. 9 .
: . r
¶
:
2 r i
. 9 .
: . r
1
t
1 , i
. 2 .
. . . r
>
4
3
:
. 9 .
T;yq%’ *‘“i’ * * ““.qg EL ,-,c
O!
‘0.2~~” 0 NC
-1 - 0
_/ -’ o o o o $ s El Z\ gig/ c
0 ;;z.J’“n 01 00 0011
, ~~~~~~~~
‘“C’“,” N= 0 00 002 0 0-1 ,61 t-4 7 :I- El -/ ;Q,I .p
Y -- OX! M =I ,o gz c
/- 1 j+
-1 I 0 *on YYC” ;j”o / 0, ?,“I
Ef
I a j $3 qq c
I ‘0
i
‘S$ZS R O* **z ZiEl 9 giy c 4 0 000~0 3 00 002 $fi I-‘; 8,3 c 7 /
*I
I I
-Pm ~~~~~~~~~ 1-i/
000~0 a
$
00
;
002
Y a
&O <
0 I I o o o *‘*/ GI 0101 o * ,I :I;1 o I 1
v c
jDEVELOPMEN1 SCHEDULE
Number of Unih Density Per Acre 0.689 Acres
I
16 2323 du
Start Predevdopment “W Jan-96 Predevelopment (Months) PndW 4 Aquisition of Land acp May-96 RetoninOlApproval Penod (Mcnths) rezone 0
ProjecI Approvat/Start ProjecI Dasign design May-96
Working Cccumenls Period (Months) drawing 4
Project Finandng Completed funds sep9a
Sitework Period (Mcnlhs) sltework 2 CMstNcuo” stat-l slarl Now90 Consbwtion Period par Phase (nwnths) mnstr 9 First Phase Completed I Start Leasing phase1 Aug-99
Total Cwtructio” Period (months) mnsb-2 9
Final Certificate of Occupancy built Aug.99
Total Lease-Up Period (Months) leaseup 1
Stabitiied 0carpa”c-y leased sep-99 Units Leased per Month absorb 16 0 Holding Period (Mcnths) hold 3 Takewt Financing takeout No-d-99 Property Sale 15 Sep.2014
ITAX CREDIT ASSUMPTlONS I
Cradit Year 1996
Federal Tan Credit Rate 6.65% State Tax Credit Rate 0.00% Oif6cult to Davelop X lW.WW Apptlcable Fractlcn lW.WO% Adjusted Eligible Basis 2,027.537
Annual Tax Credits 175.362 Investor Yield on 99% of Total Credit Alkxatlon 71.50WtlH Investor After Tax IRR 15% target 15.07% Grou lnveslw Conkibution to Lower Tin 1.241.441 Deferred Pay-In on Tax Credit Equity (Months) 15 0
Affordability Pool Pants 16.126 Credit Utilisation Points 0.000 Rent Burden X 777777
‘HUD INCOME GUIDELINES I FMR I UflLllY I BASIS LIMITS I
For. SAN OtEGO COUNTY
as of:
1 Person 2 Person 3 Person 4 Person 5 Person 6 Person
7Persc” 6 Person
lz27i96 OB/lYgS Feb-96 02Jl B/97 Utility TCAC $34.000 &nts-- 536.900 Non-Elevator
643.7w 5473 f10 64.921 Studio 548.600 5541 515 74.655 l-BR 552.5W 5677 $26 90.276 2.BR S56.4W $940 335 115.553 J-BR
560,3Qa SI.109 544 128,731 4-BR s64.2W 8x1s Fealures’): (Y/N) Y
:RESIDUAL SALES VALUE
Nel Opentlng Income - Yr 16 Capttallzatlon Rate Gross Sales Value Less: Sales Expense Less: Oebt Rcpaynwnl Permanent Debt 6alancs Redeveloproam Loan Balance Redevelopmenl Loan Accrued Mterest HOME Loan Balance AHP Loan Balanca Loan Balance Land Conlributlcn Accnzd Partnership Mgmt Fees Awed &set Mgml Fees Exit Payment to Tax Credit Partner
7
13,Wl 8.50% 160.017 3.WK (4.601)
(94.263) ~959.ooo) (431,550) 0 0
(252.06:)
(109.43:) 0.00% 0
Residual Sales Value 0
FINANCING ASSUMPTlONS I 1
Conventional Conventional Retail CONSTRUCTIOkUPERMANENT LOANS Construction Mortgage I1 Mortgage 112 Loan t1
Base Index 1 Yr LISOR C.I.P. Base Interest Pate 7.000% 6.950% 0.000% 0.000% Point Margin 2.000% 2.000% Excess Coverage 0.000% 0.550% Credit EnhancemenI Interest Rale Cap Total Inlerest Rate 9.000% 9.500% 0.000% 0.000% Interest Rate Cap (7 years) 0.000% Loan Underwriting lnlerest Rate 9.500% 0.000% o.wox Arbitrage Investment Rate 0.000% Loan Points 6 Fees 1.00% 1 .OO% 0.00% 0.00% Bond U”dewiting Fees Credit Enhancement Fee Bond Agency Issuance Fee Loan Term (Years) 30 30 30 Debt Service Coverage P.aUo (DSC) 1.25 0.00 0.00 Maximum Loan To Value Ratio (LTV) 75.0% 0.0% 0.0% Cap Rate 6.50% 8.50% 8.50%
Cash Available for Dabt Service 0.x LTV 14.766 2,956 0 Pmject Maximum Debt Capadty 1.25 67.4% 117.160 0 0 Underwltlng Debt service Limit 11.624 0 0 Total Permanent Loan Required 1.25 67 3% 117.068 0 0 Total Annual Payment 11.614 0 0
Oweloper OTHER OEBTROANS A ulsition Redevelo mt Loan
Interest Rals 0.00% 3.00% 0.00% Loan Points 6 Fees 0.00% 0.00% 0.00% Loan Term (Years) 55 0
Ground Lease $0 Land Basis O.WW Return on Basii
SOURCES AND USES OF FUNDS Resldentlal Comnwlcal TOTAL 1 lW.OX 0.0% USES: muma-
Property Acquisition - Land 15.755 Property Acquisttlon - lmprmnls Il.264 Hard Constructton Costs 6l.s.45 A6ERagaL’Co”sulta”ls 12.600 Permits 6 Fees IB.765 Developer Fees t0Wl Reserve Funds t.sa MarkeUngfModelsfOfRce 2.mo Financing 6 Other Sot? Cosls 11.W Contingency 6 ls4 A
252.063 0 252.063 Or* 160.540 0 16o.540 s.m 1304.725 0 1.304.725 b7.4~ 201.667 0 291.667 7.7% 300.236 0 300.236 10.6% 16O.ooO 0 160,ooo 5.6m 24.000 0 24.000 0.6% 40,000 0 40,000 1.5% 190.254 0 196.254 6.0x 99,105 0 99.105 3.m
Total ProjecI Uses
SOURCES:
172.034 2.752.550 0 2.752.556
Tax Cradil lnvestcr Equity 77.590 Convenllcnal MorIgage 111 1.31s Conventional Mortgage R 0 HOME Loan 0 AHP Loan 0 Redevelopment Loan-front end ss.958 DeveloperLoan 0 C~st~cUon Period Revenues 164 Developer Loan 0 Derened Developer Faa 0 Calellus Land Contribution 27,039
Total Projecl Sources 172.W
Construction Loan Conunitmsnl
62,763 1.241.441 0 1241.441
117.066 0 117,066
0 0 0
0 0 0
0 0 8 0 m.oxl 959.000 0 959,000 0
2.4: 0 0 0
0 2.400 0 i 0 0 0 0 432,623 0 432,623
2.752,550 0 2,752.556
1.358.600
Required Lccal Subsidy Required Local Subsidy per Affordable Unit Total Sedrooms Required Local Subsidy per BR Local Subsidy as K of Total Costs
1.391.623 92,775 47 29.609 50.56%
UNIT RENT ASSUMPTIONS 01:16 PM
[UNIT MlX/AFFORDARlLlTY BENEFIT ANALYSIS Mgn Unit3 2BRnBAa2BR12BA38R12BAM Income Level (AMI)
35.00% 0 1 2 2 40.00% 45.00% 80.00% Market
Total has 18 40.0% %
Sq. Ft./Unit e.50 as0 1.056 1.226 0 0 0 0 0 1.033
Resident&l SF 860 4,260 5,290 6.130 0 0 0 0 0 16.520
Related Residential SF Comrrwnity Center(s) 600 Leasing Gf6ce 0
Fitness Center 0 LaUl3dl-y 80
Commercial SF Retail 0
TOTAL SQUARE FEET 17cmO< sq. ft.
(MARKET RENTAL RATE VALUATION
-Mar-- -IawA!a Psf RENTS: Standard Rent
PSf
850 1,000 1.080 916 $1 .w so.95 JO.66 so.oi SO.08 $0.0: $0.0: so.89
view Premium
Intlatinn Premium
Adjusted Rent
Psf % Affurdabiltty
Potential Market
Proforma Rents
Affordable Ret-4 Reduction
0%
2%
so.ooo
0.0%
0
0%
2%
07t $1.02 73.3%
52.280
0%
2%
1,025 so.97 77.3%
61.600
0%
2%
1,107 50.90 75.6%
66.420
0%
2%
so.oi 0.0%
0
0%
2%
$o.ooo 0.0%
0
0%
2%
$0.0: 0.0%
0
0%
2%
$0.: 0.0%
0
0% 0
938
so.91
$180.180 So.91
a3,74a SO.42 96,432
[OPERATlNG CASH FLOW. AFTER RESERVES
Inilalion Index (y/n) Y Income Inflator 2.60% Expense Inflator 3.50%
Base Year 1998 Constmtlon lntlat!m index 0 Stabilked lnllation Index 1
YRI YRZ YR3 YR4 YRS YR6 YR IO YR 11 YR 15 YR 16
Net Rentat Income 82.465 64.647 66.661 08.828 91,046 93.325 103,013 105.588 116,66ll 119.463 Owathg Expense (56.326) ‘yo;l ‘734$ ‘y;’ @w32) w.w (78,710) (81.379) (92,999) Reserves (9.377) (9,706) (9,706) (9,706) (9.708) (9,706) ‘9y$
NOI 1 14 760 14 541 14 711 14 , 731 14,597 14.504 13 Sol
1st TO Mofigage Pmt (11,814) (11.814) (11,814) (11.814) (11,814) (11.814) (11.814) (11.814) (11.814) (11.814) Other Debt Se&e 0 0 0 0 0 0 0 0 0 0
Ground Lease cent 0 0 0 0 0 0 0 0 0 0 2nd TO/other fies Cash for distnb. (2,966) (2,727) (2.601) (2.636) (2.897) (2,917) (2,783) (2,690) (2.031) (1.767) 0 0 0 + 0 0 0 0 0 0
[PARTNERSHIP ALLOCATIONS
Developmt Psrtnrshlp SdW Tax
Procacdr ExsrmQn
Tax Credtl (Ltd) Developer Non-PmM (GP) Investor (Ltd)
99.00% 99.00% 99.00% 99.00% 50.00% 0.00% 0.00% 100.00% 0.00% O.W% 0.00% 100% 50.00% 100.00% 1 .oo% 1 .oo% 1 .OO% 1 .OO% 100.00% 0%
~~~~1* ’ - l.olyI-UIII onr.-(pm, OWN.-WV*,
La4 u sooou 1.80% L‘M 1-u LOJI ton1 WI
2m.a-a ,,,cci ry.a# LZmO ,ztci ~,100 400.030 0 2d 5.m ‘ma 2z w3 ::t I .
-““E:E 0.m ‘I - - ‘Yz ,,.cci cwequ*ee.Ru* -rmm.- LDOI : DrQPk.W 0 M-r” otd : Mad. k Me4 nm Meu-D,“.uw ok-4 calv-tw.oH omli : - 14.11, Am’ m.Ka -*k =Js--- -- pbpmf.pa Ud Corr- -h-l -,~--lron x*r- wpILwlm%mwe-
1.001 l.mm 0.00x l.Ka u sDDDL.3
w.~ E ‘mm u
‘3.sm t.,n 0 I.003
:“, ‘Oi ‘0.ooo 0 0
hMdcm+c- * -gab’- 2
- IIuITu.--
-I-- + - I - -w
TOTAL -cl -
-49 0 -- Id : lS.om SOPI m u(ti ’ .
- *Irr mu Ica - 4- pg” B.vta 2s I.“’ k-a $a0
‘ROYM tru.x4.
0 zM7.a
rrszq
- 1 BLUFF APARTMENTS, CARLSBAD
NET OPERATING INCOME
Income Inflator 2.50% Expense lnffator 3.50%
lnflatlon Index 1 .oooo
RENTAL INCOME:
Gross Potential Rent
Credit Check/Late Fees/Laundry Retail Revenue
Vacancy Allowance - Residential Vacancy Allowance - Retail
Net Rental Income
OPERATING EXPENSES:
General & Administrative: Advertising Leasing & Commissions Legal Accounting/Audit/Recerts
Security Oftice Supplies 8 Expense
Property Management Fee
Utilities: Fuel
Electricity Gas
Telephone
Water and Sewer
Payroii/Payroii Taxes:
Manager
Assistant Manager Community Coordlnator
Leasing Agent
Maintenance Supervisor Maintenance Personnel
Security Personnel Payroll Taxes/Workers Comp
Health Insurance
Maintenance:
Painting & Decorating General Repairs
Trash Removal
Exterminating Building & Grounds Maintenance
Elevator 8 Other Equipment
Facility Services
TOTAL VARIABLE EXPENSES
Taxes & insurance Property Tax Assessment
Other Tax Assessments Partnership Taxes
Property Insurance
Unsubordlnated Ground Lease:
TOTAL FIXED EXPENSES
TOTAL EXPENSES
NET OPERATING INCOME:
STABiLiZED YEAR 1
$5.00 /unit 0 $0.00 lsf
5.00% 10.00%
5,030 /unit
$25 Imo 311 $0 lmo 0 $125 /mo 1,553 $292 Imo 3,623 SO Imo 0 $100 imo 1,242
8.35% of NOI 6,888
$0.00 /uniVm 514.00 /uniVm
512.00 /uniVm SlOO /mo
$29.00 /uniVm
5750 /ma 9,315 $0 Imo 0 $0 lmo 0
SO /mo 0
SO Imo 0
5500 Imo 6,210 SO Imo 0 20.00% 3,105
580 fmo 994
53.00 /uniVm 596 67.50 /uniVm 1,490
515.00 /uniVm 2.981
$2.00 /uniVm 397 $25.00 /unit/m 4,968 SO Imo 0
SO /mo 0
S3.376 /Unit 55,844
SO /unit
SO Imo SO Imo S150 /unit
SO Imo
S150 /Unit
53,526 /Unit
Reserves: 0.60% of hard costs or Replacement Reserve $489 /unit
Operating Reserve SO /unit
Other Reserves 21,071 S77 /unit
TOTALRESERVES 18,502 S566 /Unit
NET OPERATING INCOME (inci. Reserves):
85.842 985
(4.34:) 0
82,485
0 2,782
2,385 1,242
5,764
0 0 0 2,484 0
2,484
58,328
24.157
8,102 0
1.275
9,377
14.780
AFFORDABLE HOUSING ANALYSIS
OCEAN BLUFF APARTMENTS, CARLSBAD
MASTER BUDGET BREAKDOWN
CONSOLIDATED SUMMARY
OCTOBER 2,1997
DATE REVISED
UNITS 1
ACRES 7 0.689 1
BUDGET SUMMARY
I CODE I DESCRIPTION /
1000
1500
2000
2300
2500
3000
3900
4000
5000
5900
6000
6800
7000
8000
Property Acquistion 25.15
Permits and Fees 17.46
Offsite Improvements 1.03
Common Area 0.00
Engineering 2.27
Onsites - Direct 40.00
Lot Improvements 16.28
Construction Indirects 14.07
Project Development 9.45
Overhead 13.78
Financing 12.46
Property Taxes 0.00
Model / Sales Complex 0.87
Sales and Marketing 1.45
Contingency 5.76
I
s:\projectiiurbanhou\oceanblu\9~29~97.wk4
TOTAL 160.03
APPROVED BY:
PER SF
Project Manager
Division Head
Finance
PER UNIT
27,039 432,623
18,765 300,236
1,108 17,725
0 0
2,438 39,000
43,000 688,000
17,500 280,000
15,125 242,000
10,163 162,607
14,813 237,000
13,391 2 14,254
0 0
938 15,000
1,563 25,000
6,194 99,105
172,034 2,752.550
Construction
Marketing
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jpCtAN BLUFF APARTMEN-. - RUN DATE:
[ Family Medlan 35% 40% 45% 80% 100%
1 Sbr horn* of Medlm of Median of Median of Median of Median
1 34.000 11.900 13.600 15,300 27,200 34,000
2 38.900 13.615 15,560 17,505 31,120 38,900 3 43.700 15,295 17,480 19.665 34.960 43.700 4 48.600 17.010 19,440 21.870 38,880 48.600
5 52.5UO 18.375 21.000 23,625 42.000 52,500
6 56,400 19,740 22.560 25,380 45,120 58.400 7 60,300 21,105 24,120 27,135 48,240 80,300 8 64,200 22.470 25,680 28.890 51.360 64,200
Family
Size Unit Type
Number
of Units
Maximum Monthly
Rent UUlity Allowance
Net Net MOllthly Annual Rent Rent Unit Total Rend Sq. Ft. Sq. Ft. Sq. Fti
% of Median
35.00% 35.00% 35.00%
35.00% 35.00% 35.00%
SW%
35.00%
35.00%
40.00% 40.00% 4O.W# 40.00%
40.00% 40.00% 40.00% 40.00% 40.00% 45.00%
45.00%
45.00%
45.00% 45.00% 45.00%
45.00%
45.00%
45.00% 80.00% 80.00% 8O.W% 80.00% 80.00% 80.00% 80.00% 80.00%
80.00%
Market Market Market
Market
Market
Market
Market
Market Market
20RI2EA Mgr 2BRnSA
2BRlzBA Mgr 2BRl2EA
2BRf28A Mgr 2BRf2BA
28Rl2EiA Mgr
2BRnBA
30FU20A 4BRf2BA
2BRlZBA Mgr
2ERREA
48W2BA
0
0
2
2
0 0
0 0 0
0
0 1 0 0 0
0
0
0
0 0
TOTAL PROJECT
RELATED RESlDENTtAL SPACE:
Comnwn’8y Center(r) 600 Leasing Offke 0 Fiiners Center 0 Laundry 80
Total Related ResIdenthI Space 680
TOTAL PROJECT RESlDENTtAL SQUARE FOOTAGE 17.200
341 26 381 26 441 35 493 44 0 0 0 0
0 0 0 0 0 0 436 26 436 26 505 35 563 44
0 0 0 0 0 0 0 0 0 0 491 26 491 26 568 35
634 44
0 0 0 0 0 0
0 0
0 0
873 26
873 26
1,010 35
1,127 44
0 0
0 0 0 0 0 0 0 0 0 0 850 0
1,000 0 1,080 0 0 0 0 0 0 0
0 0
0 0
0 0 355 4,260 406 9,744 449 lo.?76 0 0 0 0
0 0
0 0 0 0 0 0 410 9.840 470 5.640 519 12.456
0 0 0 0 0 0 0 0 0 0 0 0 465 11.160 533 12,792
590 7.080 0 0 0 0 0 0 0 0
0 0
0 0
847 0
975 0
1,083 0
0 0
0 0 0 0 0 0 0 0 0 0 850 0
1,000 0 1,080 0 0 0 0 0 0 0 0 0
850 850
1,058
1,226 0 0
0
0
0
850
850 1.058 1,226
0
0
0
0
0
850 850 1,058
1,226
0 0 0
0
0 850
850
1 Ass
1,226
0
0
0
0
0 850 650
1.058
1,226
0
0 0 0 0
0 850
2,116
2,452 0 0
0 0 0 0 1.700 1.058
2.452 0 0
0 0 0
0
1,700 2.116
1.226
0 0 0
0
0
0
0
0
0
0
0
0
0
0 850
0
0
0
0
0 0 0
SO.00
SO.42 so.38 SO.37 S0.W SOo.W so.00 so.00 SO.00 S0.W
SO.48 80.44 SO.42
2:: SO.00
::Ei
ii::
2:
Ei SO.00 s0.w
s0.W t0.W
$1.00
so.92
so.88
i::
so.00
Et:
to:00
$1.00
so.95 SO.88 SO.00 SO.00 SO.00 So.00
10.520
PROJECT DEVELOPMENT COSTS 6 FINANCING - PART Vlll CTCAC APPLICATION
/
\OEVELOPMENT COSTS TOTAL
NON- DEPRECIABLE BASIS TOTAL 1 PER UNIT DEPRECIABLE RESIDENTIAL NON-RESONT AMORTIZED EXPENSED RESIDENTI. ]
Land Cost
LtgaVBroktr Fetfillt
Off-sib lmprovtmtnb Dtmolifion
Edsting lmprovemtnb value
Totti AcquItWon Corft
r Sbudurts
General Rtquirtmtnls
Confractor Overhead
conlraclcr PfOfil
Total New Conrtructlon Cortr
Design
SUpervisiOn
Total Archlttctunl Costs
AcquirlUon Loan lnttresl
Loan Ori@naUon Ftt
Prootrlv Taxer
Gr&ndvLtast Payments
Ccnstrudion Ptfiod Iruunmx
Cwltuclion lnsotclicm Fnr 1?Ut & Reaxdh~
Total Constnxtlon Intwtrt 6. Fees
Loan Origination Ftt
CrtdU Enhancemtnl and &@icaUon Ftt
Title 6 Recording
Tottl Ptmuntnt Fhanclng Cortt
50,ow 3,125 0 53.000 0 0 0 w.ooo 5.000 313 0 5,ow 0 0 0 J.ooo
Ltndtr Legtl Costs Paid By A+plicd
Led - Rtal Esttb L&l - syl?dicatkxl 0 0 0 0 0 0 0 0
Total Attorney Costs 55.ow 3,438 0 55.000 0 0 0 55,ooo
Rtnl Reserves
Olher
Total Rtnt Rtrtfft Cortt
Ql!w
TCAC AppJRtttwJMcnitting Fees
EnWonmenbVloxic Rtmtdblkx
Local Ptrrnil Fees
Marketing
FumisMgs
CapibI Fees Optnting ShWnaU Sofl Cal Contingency Total Other Cotu
TOTAL PROJECT COST
Con&nUPrccts.sing Agtnt Ftts
Pro&l AdminisLraUon
OlhW
Total Dtvtloptr Costt
160,ow lO.oW 0 160,wo 0 0 0 160,ow
26.500 1.656 0 26.500 0 0 0 26,500 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
166,500 11,656 0 166.500 0 x 0 186.500
TOTAL PROJECT BASIS 2.741.550 171,347 474.346 2.176.614 0 51.746 38.642 2.741.550
SyndicaUon Ltgai Costs
Tax Crtdit CmsuUanb
Syndicalion AaounUngrAudiUng
Total NorMarls Cosb
lO.WO 625 0 0 0 lO.Wo 0 lO.wxl
0
2 :
0
0”
0
i
0
1SW 0 1 ,000 l.ooO
11,wo 668 0 0 0 11,WO 0 11,ow
TRUE PROJECT COST a . , . 0 62,746 2 752 550 172034 474 348 2176614 36,642 2.752.55(3
Projeci Subadies
Olher Basis RtducUon
Total Barls Rtductiona
NET PROJECT BASIS
432,623 27.039 432.623 0 0 0 0 432.623 0 0 0 0 0 0 0 0 17.725 1.106 17.725 0 0 0 0 17.725 0 0 z 0 0 0 0 0 0 0 0 0 0 0 0 450,346 26,147 450.346 0 0 0 0 450,346
260,OW 17.6cu 0 280.00(3 0 0 0 260,Wa 6aa.MM 43.Wa 0 666.wo 0 0 0 wmlo 162.Wa 11.375 0 162,ooo 0 0 0 162.000 6Q.000 3.750 0 60.000 0 0 0 m.ow
77.000 4;l313 0 77:Wo 0 0 0 77,WQ 1.267.000 80.436 0 1.287.000 0 0 0 1.267.WO
106.000 6,625 0 106.m 0 0 106.000 0 0 0 0 0 0 0 106,000 6,625 0 106,wo 0 0 0 KwW
39,000 2,436 0 39,wo 0 0 0 39,ooo
6a.600 4.y)o 0 29,956 0 0 36,642 @x800 0 0 0 0 0 0 0 0
13.566 649 0 13.566 0 0 0 13.568
x 0 0 0 0 0 24.10; 0 0 0 0 i x 24,107 I.507 0 0 24,107
4.4w 275
8
4.4w 0 0
8
4.400 10,wo 625 0 10,ow 0 0 0 10,Wo
120,693 7.556 0 62.051 0 0 36,642 120,693
2.171 136 0 0 0 2.171 0 2,171
0 0 0 0 0 0 0 0
10,ow 625 0 0 0 lO.OW 0 1 o.Wo 12,171 761 0 0 0 12,171 0 12.171
24.000 1.500 24,WO 0 0 0 0 24,WO 0 0 0 0 0 0 0
1,500 24.000 0 0 0 0 24,WO
5,000 313 0 5.000 0 0 0 s.wo
61,386 3,637 0 61.386 0 0 0 61,386
14.575 911 0 0 0 14,575 0 14.575 3W.23: 16.765 0 0 0 x0.2360 0 0 0 0 0 300.238 0
25,Wil 1.563 0 0 0 25,d 0 25.WO
15,oW 934 0 15,WO 0 0 0 15,wo
0 0 0 0 0 0 0 0
1.722 108 0 1.722 0 0 0 1,722 37,719 2,357 0 37.719 0 0 0 37.719
394,252 24,641 0 354,677 0 39,575 0 39,252
2.555.050 159,691 474.348 1.990.114 0 51.746 38.642 2.555050
0 0 0 0 0 0 0 0.000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
2.752.550 172.034 474.348 2.176.614 0 62.146 36@2 2,x2.553
-
OCEAN, -CARLSBAD 1 Q103197
CTCAC TIEBREAKER CALCULATIONS
Threshold Average Affordability:
less Proposed Average Affordability:
Amount Below Threshold
56.000%
39.872%
16.128
Points (Maximum of 16 Points) 16.000
on Poiats San Diego County Threshold Basis Limits - Non-Elevator (02/18/97)
Unit
2BRl2BA Mgr
2BRl2BA
3BRJ2BA 4BRl2BA
Total
Net Project Basis
Requested Eligible Basis
Credit Utilization Points
TCAC’s
#Units Basis-
1 90,276 90,276
5 90,276 451,380 5 115,553 577,765
i 128,731 0 643,655 0
0 0 0 0 0 0
0 0
ii 0 0
16 1.763.076
2.176,614
TCAC’s
Basis Limits
-Featuresi
103,817 103,817 103,817 519,085 132,886 664,430 148,041 0 740,205
0 : 0 0 0 0
0 0
2,027,537
2,176,614
2.027.537
0.000
RUN DATE: I OlOW97
TAX CREDIT CALCULATIONS
Preliminary Eligible Basis
Federal . Its
2,027,537
State
Credits
2,027,537
Deductions from Eligible Basis:
Grant Proceeds Used to Finance Costs in Eligible Basis 0 0
Federal Loans Used to Finance Costs in 9% Eligible Basis 0 0
Non-Qualified Non-Recourse Financing 0 0
Non-Qualifying Portion of Higher Quality Units 0 0
Historic Credit (Residential Portion Only) 0 0
Total Deductions from Eligible Basis
Total Eligible Basis 2,027,537 2,027,537
High Cost Area Adjustment
Total Adjusted Eligible Basis
Applicable Fraction
Total Qualified Basis
Tax Credit %
Total Annual Tax Credits
LP Share of Credits
Credits Available to Equity Provider
Credit Period
Total Credit Allocation
Investor Yield
Gross Investor Contribution
Less Lower Tier Syndication Expenses:
Legal - Syndication
Syndication Consulting
Syndication Accounting
Total Syndication Expenses
Syndication Expenses funded from Construction Loan:
Net Investor Contribution
100.00% 100.00%
2,027,537 2,027,537
100.000% 100.000%
2,027,537 2,027,537
8.65% 0.00%
175,382 0 1,753,820
99.00% 99.00% 99.00%
173,628 0 1,736,281
IO 1
1,736,281 0 1,736,281
0.715000 0.715000 0.715000
1,241,441 0 1,241,441
10,000 0 10,000
0 0 0
1,000 0 1,000
11,000 0 11,000
(11,000) 0 (11,000)
1,241,441 0 1,241,441
RUN DATE: 1%3197"
1 1998
2 1999
3 2000
4 2001
5 2002
6 2003
7 2004
8 2005 9 2006
10 2007
ii 2008
12 2009
13 2010
14 2011
15 2012
16 2013
17 2014
18 2015
19 2016
Tax Credit
Partner
(15,000)
(1,226,441)
0
0
0
0
0
0
0
0
0
0
0
0
0
0
i
0
Federal
0
173,628
173.628
173,628
173.628
173,628
173.628
173.628
173,628
173,628
173,628
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
40.00%
Tax Savings
32.8;;
35,463
36,823
35,704
34,828
34,188
34,145
34.042
33,283
32.580
32,519
32,452
32,379
32,298
32,209
29,439
0
0
Asset
0
247
2,946
2.733
2,806
2.861
2,899
2,917
2,915
2,892
2,846
2,776
2,680
2,557
2,406
2,224
1,862
0
0
Sales 40.00%
Distribution Proceeds & Income Tax
of Fvit Payment uahilih!
(:I 0 0
(0) 0
(0) 0
(0) 0
(0) 0
(0) 0
(0) 0
(0) 0
(0) 0
(0) 0
(0) 0
(0) 0
(0) G
(0) 0
(0) 0
(0) 0
0 0
0 0
(9:)
(1,178)
(1,093) (1,122)
(1,144
(1,159) (1,167)
(1,166)
(1.157)
(1,138)
(1,110) (1 .OW (1,023) (962) (ago)
(745) 0
0
JOTAl
(14,918)
(1,019,789)
210,859
212,091
211,015
210,173
209,555
209,523
209,419
208,646
207.916
34,185
34,060
33,913
33.741
33,543
30,556
0
0
20 2017 0 0 0 0 0 0 0 0 0
TOTAL (1,241,441) 1,736,281 0 535,310 40.565 (4) 0 (16,225) 1.054,487
IRR 15.07%
-
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-
IPROPERTY SUMMARY J [SOURCES AND USES
Number cl Units 10 unifs USES: l?lahlu
0.402 NeI 0.089 Gmss Pmperly Aquisitioo -Land 15.755 252.g cdl ACreS 15.00
Pmm Acquis~tioh - Impmwnnts 11,284 180.546 10.75 Omsily 39.0 du 23.2 du Hard constnrc0M 85.032 1.380.511 80.98
emdenq 5x33% A6ELqalICmsulbnb 15,224 243.580 14.50 Permits 6 Fees 10,700 315,193 16.76
OeveloperOvemead 9.083 158.122 9.41 ~OBVELOPMENTSCHEOULE Marlteting co93 8.405 150.474 0.98
Fhanang L omer son costs 5.521 08.331 5.26 Pmjecf Commencement Year oimim.3 n8w Total Project uses 171,602 2.748.835 163.62 Slat Pmdevelopment ofmime aft
Pred~do~ment shms\ 4 omdev SOURCES:
Aquisi&of-Laid
Financing Period (Months) Project Finanting Completed
Silwmk Pedod (hbnm.3) Finish Skew& I Stab Models Lag behvem Models 6 Phase I start Sal Phase I Unit Conskwtioh
Total Cohsuuc6on Phases hbrns per Cohswucti~ Phase TOM CMWUCUO~ P&d (hioflms) Completion/CefUficale of Occupancy
starl of Sales Unit Sales per h40hm
hfohms per Sales Phase Total sates Pedod (MohlhS) Pmpefty Sell-out
a.0
Osmlm.5 aq
4 finance 08101190 runds 2 filework iimima modtis
0 Ml 11/01/96 phase1 1 phases
9 phase 9 consw 00401190 finish owozms sell
a.0 absorb
: sales 1om1me sellout
ConslNction Loan Marlteflng Casts pad in Escmw
Cakllus Land Contribution Land hion~lization
Equily -up fmnl Eqlkly - ccosbuctioh matching Finandal Partner Equity - coosu. malching Land OrmecCohtnbulion -up fmnl
Redevelopmmt Set &de -up fmnl Total Cohstruclfw Sources
Redevelopmaht BeI AsIde -back end Equcy Repaymeol lo
Total Proj.4 Sources
Agmcy Homebuyer Oowhpayment Awslance ToGI Redeveiopmeht Agency Pahiapaiion
77% LN 1.452.903 sa.309
432,623
Lt : 0 0 0 0”
50.313 805900 2.748.835
0 0
2.748.835’
0 0 50.313 6fJ5,Mx
[FINANCING ASSUMP~ONS
AQE Loan lhmresl Rale
Consln~cUm Loan Interest Rate LIBOR - 6 mos. 5.61 x Point Margin 2.wx
excess cowage 0.00% Construction Loan Poinls 6 Fees Maximum Loan to Market Value Maximum Loan to Tobl Cost CaWrucUan Loan Payoff Premium
I
0.00% ?.a!%
l.W%
05.0% LN 05.0% LTC
110.0%
ISALES EXPENSEABSUMPIlONS I
Broken Ccmmissiohs 0.00% Escrow Closing Costs 52.500 lander Tax 1.10%
Wamnty Resawe so
Litigation Resewe 0.00%
IHOMEBUYER flNANClNC ASSUMPTIONS i
Mortgage km Interest Rate 7.75% Pt.41 pemehtage mle 0.55%
Hazard klwtanca me 0.04% Property Tak tale 1.10%
hblhly HOA dues s120.w Homebuyer Dcwhpaymenl 5.00%
/HUD MEDIAN INCOME GUIDELINES
SAN DIEGO COUNTY, effective December 27.1988 Family Sire: Median Incoma
1 person
2 Person
3 Person 2::
4 PenoIl ua&x
5Pamoh 652,xX) 0 Penoh
7Persoo %t a P~EO~ &2w
Average Persons per Bedmcm 1.5 Housing Pmt as % of Income 33%
[UNIT MIX B PRICING
PRODUCT: AMomJabilily
5aooK
75.wx 05.wx 100.00%
Marcat Pal8
WW (moderate)
Total Unils x Mix
Bedrm
Barnmoms
UNIT SQUARE FOOTAGE
TOTAL SOUARE FEET
Ease Mwket Value View Premium Adjusted Ma&et Value
Market Value as K of AMI Market Value per sf
SlW.WO Sl35.OW so
0.0: so so so S117.5Gl avg. base 0.0% 0.0% 0.0% 0.0% 0.0% 0.0: 0.0% 0.0% slw.wo S135.000 so so 78.34% 66.40% O.W% 0.00% 0.w: so so so Sll7.5W avg. yalu? 0.00% 0.00% 0.00% $111 $113 so so so so so so $112 wvp. psf
Appraised Value per Link so SO
Avg. Pmmium per Unit 0 0 Adjusled Appraised Value SO SO
eLBcsl ,ELAJiz EIAM PLAtu. rQIAl.
0 0
:
0 0 a 0 : :
0 0 0
0 0 16 0 0 0 0 0 0 0
0 0 0
i
0 0 0
ti
0
0%
9%
O.W%
%
0.0% 100.0% 0.0%
a 50.0% 2 1.0
800 7300
a 50.0%
2.:
t ,200 9.0w
0 0.0%
0.0”
z
0
00%
0:
:
0 0.0% 0 0.0
0 0
0
0.0% 0 0.0
0 0
0.0: 0 0.0
:
/ 0 ! 16
0.0% ’ lW.OY
0.:
1.050 avg. 51 : 16.0w lotal Sf
so So 50 SO so SO appiaised 0 0 0 0
so so so SO SO avg. adj.
;PROJECT PROFlTABlUTY
UNIT SALES PRICE 50% Affordable WY w 75% AtfofdaMe (bw 85% Affordable ow 100% Afbdable (moderate)
Market Rae
.EuNJ eu4.2 euu eutu
so so SO so 85.402 112.654 0 0 0 0 0 0 8 8
Kmlpervait
so $0 so 0 1.064~ 104.026 0 0 0
0 0 i 0”
TOW Sales pmceeds $763217 t801.229
Redevelopment Proceeds (upfront or backsnd)
Total Pmjecl Oevelopmenl Costs (less Developer Towhead) Developer Ovemead 4 Comma Mamgemeht Fees
Preiefred Return Payments
so 30 so SO so so $1.881,~18 5104.026
$1.237.023 77.351
PROJECT SURPLUS (SHORTFALL) PROFIT
Project Profit X
-
CONSTRUCTION ASSUMPTIONS
[CONSTRUCTION I SALES PHASE TIMING
CONSTRUCTION Duration SALES Duration aaIl Einish(monthd siad EioishImonths)
Sitework 09/01/96 11/0119% 2 MOdeIS I l/01/98 08101/99 9 Models oa/oz99 0 Phase 1 I l/oima oa/oi/99 9 Phase 1 oa/oi/99 10/01/99 2
Build Out Build Out oaIoi/99 10/01/99 2
Total 09ioi/9a oa/ol199 11 08102199 1oio1l99 2
[UNIT MIX BY CONSTRUCTION PHASE I
Sitwork
Models Phase 1
Build Out
Total Units %
E!L.!wlwPlAN3
: : 0 0 0 : 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0” 0 0 0 0 0 0 0 0 0 0 0 0 0
0 0
0 0 0 0 0 01 0’ 0
14 0 0 0
: 0 0 0
0.0% 12.5% 87.5% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
/HOMEBUYER AFFORDABILITY ANALYSIS
lzLANlwpy\Nw
Bedrooms 2 3 Bathrooms 1.0 2.0 Maximum Family Size (Persons) 3.0 4.5 0.0 0.0 0.0 0.0 0.0 0.0 Median lnc0me Level 43,700 50.550 0 .O 0 0 0 0
Mortgage Calculation 2 75% Affordable Sales Price 95,402 112,654 0 0 0 0 0 0 Downpayment Assistance 0 0 0 0 0 0 0 Buyers Cost 95.402 112.654 0 0 0 : 0 0 Homebuyer Downpmt (4.770) (5.633) 0 0 0 0 0 0 Mortgage Amount 90.632 107,021 0 0 0 0 0 0
Homabuyer Monthly Costs Mortgage 7.75% 649 767 0 0 0 0 0 0 PMI 0.55% 44 52 0 0 0 0 0 Hazard Insurance 0.04% 3 4 0 0 i 0 0 0 Pmparty Taxes 1.10% a7 103 0 0 0 0 0 0 HOA dues 120 120 0 0 0 0 0 0 Total Monthly Cost 904 1,045 0 0 0 0 0 0
Affordability Calculation Total Annual Cost 10.644 12.544 Housing Cost Coverage 33% 33% 33: 33; 33,” 33: 0 0 33% 33% Supportable Income Level 32.660 36,013 0 0 0 0 0 % Affordability 75.20% 75.20% 0.000% 0.00% 0.00% 0.00% 0.00%
CODE
1000
1.500
2000
2300
2500
3000
3900
4000
5000
5900
6000
6800
7000
8000
C
AFFORDABLE HOUSING ANALYSIS
OCEAN BLUFF CONDOMINIUMS - CARLSB~
MASTER BUDGET BREAKDOWN
CONSOLIDATED SUMMARY
OCTOBER 2,1997
DATE REVISED
UNITS
ACRES
161
0.689;
BUDGET SUMMARY
DESCRIPTION PER SF
Land 25.75
Bonds and Fees 17.87
Offsite Improvements 1.06
Common Area 0.00
Engineering 2.32
Onsites - Direct 45.00
Lot Improvements 16.67
Construction Indirects 14.40
Project Development 11.49
Overhead 9.41
Financing 4.72
Property Taxes 0.28
Model / Sales Complex 1.49
Sales and Marketing 7.04
Contingency 6.12
Land Owner Contribution (25.75
TOTAL. 137.87 144,763 t 2,316,212
APPROVED BY:
Project Manager
PER UNIT
27,039
18,762
1,108 0
2,438
47,250
17,500
15,125
12,061
9,883
4,960
297
1,563
7,394
6,423
(27,039 {
432,623
300,184
17,725 0
39,000
756,000
280,000
242,000
192,98 1
158,122
79,367
4,758
25,000
118,309
102,766
(432,623
Division Head
Finance
Construction
Marketing
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RUNDATE: I-
cvELoPyu(T AND
-
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1 2 J 4 I 7 . , lb 11 TOTAL Jm-ll F&W Mwe8 AWe8 khJ.ea Jd 11 hlnl Au0.m sapI 0cl-w Nor48 c,&,
2 2 11 14
i a
:
:
: 0
1e 0 0 d 0 0 0 d d d d 16' d
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bt%F- &OWlmnh : I 0 0
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0 0 i : : Total unll cbshes $6 0 0 0 0 0 0 0 0 0 0 0 0
sala c- oat, M-m S*hr camphlk37 Dab LPm
GROSS SALES PRCCCEDI w3e441.ue to so so so sb so so so so SO so REDEVELOPMENT SElWIDEd*CK END SO 0 0 0 0 0 0 0 0 0 0 Y 0
Sa*a 4 km coala Bmws- 0.00x 404 0 ESGWckUblJColo 2.sm 0 : i : i : i 0 0 0 0 0" 0 i 0 1nrkr Tax LloK wx4 0
Wnu*yRufU O.& : : : i i i i ii i : L? : . LilbalblllhwM 0 0 0 0 0 0 0 0 a0 0 0 0 ToW s&s L vlrranp 350% ewoe 0 0 0 0 0 0 0 0 0 0 0 0
CASH AVAIUILE FOR DEW SERWCI! 4. .I 0 0 0 0 0 0 0 0 0 0 0 0
Loan Rhau Pmnmd ll.&52.00() 0 0 0 0 0 0 0 0 0 0 0 0
NET SALES PRGCLEDS IlJfy 0 0 0 0 0 0 0 0 0 0 0 0
Pwlw Pdmwd Rdlm O.mX 0
Pnhmd Ilm O.CO% : 0 i : : i 0 0 0 0 0 0 0 i : 0 0
Pwlnw cqully RapaJmml 0 0 0 mum7 nwwnaa 0 0 : : 0 : i 0 0 0 t 0 0 0 : 0 :
PmJEcT PRGFI? lUzJ4 0 0 0 0 0 0 0 0 0 0 0 0
Ihr* Pro* 1 mY%u : 0 : 0 i : 0 0 0 i 0 FlNncbl Pubu Rdl 0 0 0 0 0 0 0 : Orolur Pwtklpadng Pm* 0 0 0 : 0 0 0 0 0 0 0 0 0 0
DEVELCWENT AND SALES ANUYSlS
iimima llrnme
mldoul Total unn StArtl
F 050169
PIUS81 WQlnQ
2 14
mldo\1 Total Units Avallab!a 0 0 d 0 0 d d 18 d 0 0 o-
kte- PLAN2 2z:
l@al unit tugs
8.0 Da mm-ml 8 0 0 0 0 0 4 4 0 0 0 0” : :
: 0
: if : 0” : 0 I 0 0
: i : i : : : : 0 0 : : 0 0 0 : 0 i 0 0 0 0 0 0 0 0 0 0 0 : 0
: : : : 0” i : : 0 : : : : 0” 0 0 0 0 0 0 0 I G 0
sa*r C-namln Date M-m SIks C0mpkU.m DIM sepm
it!cF= : 0” 0 0 PLAN2 0 0 : : : 4 0 0 4 0 : 0 :
PUN3 0
PUN4 : : : i i 0 0 : i : G i : 0 0 : G 0 0 0 0 : 0 a0 0 : 0 0 i 0 0 0”
: : i : : : : : 0 : : : Tow unn l4lwltuy 0 0 0 0 0 0 0 8 0 0 0 0
GROSS SALES PROCEEDS so so 50 so so 50 se32223 50 50 50 REOEVELOPMENT SR ASIDE-BACK END 7 0 0 0 0 0 0 0 “9 0 0 0
sa1qq i hwkatlng cost* amkamnblm Roe% 0 ii : : ii : : 20.d 0 0 0 0
rwtg”” cost 1.10% 2x0 : 2o.wo 0 0 0 0 0 9.154 9,194 : : : W-R- 0.02 0 : UllgatbnR- 0 0 i : : : : : : 0
Total sa*a L MuwIng 3.50% 0 0 0 0 0 0 0 2Q.lY 28.15( : : : 0
CASN AVAILABLE FOR DEBT SERVICE 0 0 0 0 0 0 0 803.089 9al.089 0 0 6
Loan RqLlau Paymnt 0 0 0 0 0 0 0 (799.067) (e.qeQ7) 0 0 0
NET SALES PROCEEDS 0 0 0 0 0 0 0 3.972 149,292 0 0 0
Partner Pnhnd Relum O.CG% 0 0 0 0 0 0 0 0 0 0
Pnlrmd Rqlum 0.00x 0 0 0 0 0
: :
Parlmr Equity Rqpaymutl : i EqW W.wmnt 0 : 0 : : 0 : i 0 0 0 : : 0 : 0 0
PROJECT PROFIT 0 0 0 0 0 0 0 3.972 149262 0 0 0
D*wlop#r Prom FItuncIal Puinw Pro(n Bmkw Pwtklpaung Pmln
A : 0 i 0 0 0 0 3.972 149262 0 0 0
0 0 i 0 : i : : ii 0” : : 8
- TRANSMISSION VERIFICATION PORT
TIME : 10,‘03/1997 12: 53 NAME : CATELLUS
K
RES IDEbIT I AL : 714-251-1933 : 714-251-6108
DATE, TIME FAX NO. /NAME
%E”:;y” RESULT MODE
la/63 12: 34 17684386981
8: 18: 56 OK STANDARD
Attachment No. 3
Housing Commission Minutes:
August 14,1997
September 11,1997
October 23,1997 (Draft)
HOUSING COMMISSION MINUTES
August 14, 1997
Page 4
VOTE:
AYES:
NOES:
ABSTAIN:
purchase 2.55 affordable housing credits in the Villa Loma Housing Project in order to
satisfy the affordable housing obligation of the Mar Vista at La Costa Project under the
City’s Inclusionary Housing Ordinance.
7-o-o
Calverley, Escobedo, Latas, Rose, Scarpelli, Walker, Wellman
None
None
2. OCEAN BLUFF - Application to purchase affordable housing credits in the Villa Loma housing project.
Craig Ruiz reviewed the background of the request and stated that this project went through the same process as the
Mar Vista at La Costa project just presented. Mr. Ruiz described the project as 92 single-family homes on a 3 1 -acre
site. The homes will be on lots of between 7,500 and 13,000 square feet. The Inclusionary requirement on this project
is 16.24 units, with a credit price of $32,220 per unit. If approved by the City Council, a payment of $523,252 will go
into the City’s Housing Trust Fund.
Mr. Ruiz stated that this project was originally before the Commission in February 1996. To satisfy the Inclusionary
obligation, the applicant proposed the 92 single-family homes and a 16-unit apartment complex. At that time, there was
a proforma analysis that was done that showed the cost to build the project, and there was no mention of how the
project was going to be financed. When the project was approved by the City Council in April of 1996, they approved
the Planning Commission’s condition that said the developer had the option of building the 16-unit apartment complex
or purchasing housing credits in an approved Combined Project, if approved through the Combined Project Review
process. The developer is now requesting to purchase credits in the Villa Loma project. Per the developer’s request,
the proposed affordable housing project is not feasible and the developer would like to purchase credit as opposed to
the previous approvals they have received to construct the 16 units on site.
Mr. Ruiz explained that Council Policy 57, as discussed earlier, was also applied to this project. Mr. Ruiz stated that
the small development of this 16-unit development makes it economically unfeasible due to the significant financial
subsidy which would be required for the project of about $55,000 a unit. Mr. Ruiz added that the year-old proforma is
still relatively accurate. In addition, small projects have more difficulty generating interest from funding sources.
Mr. Ruiz explained the advantages and disadvantages of the off-site proposal as being similar to what was heard with
the previous project.
Vice Chairperson Wellman asked if there were any questions of Mr. Ruiz.
Commissioner Calverley asked how the applicant had proven that it was not feasible to build.
Mr. Ruiz responded that this information is based upon the proforma and an analysis. Staff believes that the purchase
of credits is the best option for this project.
Commissioner Scarpelli asked how the $500,000 in credits from this project would be applied.
Ms. Fountain responded that there are several projects that have money committed to them, i.e., the Laurel Tree
project, the Sambi project (a first-time homebuyer project). Any money coming in would be used on those existing
projects; then future projects would be looked at. Ms. Fountain added that there are quite a few projects on the horizon
that will potentially ask for money; one being Poinsettia Properties, a lo&unit apartment project.
HOUSING COMMISSION MINUTES
August 14, 1997
Page 5
Ms. Fountain added that generally a $22,000 per unit subsidy is not the best “bang for the buck” for only 16 units. A
108-unit apartment or a 50-unit apartment project with $10,000 to $12,000 per unit in subsidy would be something
Staff would be more comfortable recommending..
Vice Chairperson Wellman asked if Staff weighed the advantages of original proposal with the affordable on-site
apartments, which goes toward the mixed use and not segregating lower income people to certain areas. Vice
Chairperson Wellman asked if condo or homeownership is also not feasible on this 3 1 -acre site.
Mr. Ruiz responded that Staff looked at the proposal that the developer put forward, which is a 16-unit complex. Staff
did not look at a for-sale project, because that was not what was presented to Staff. Staff did evaluate whether this was
the best place to put this type of project. If the City Council wants to put in $22,000 per unit, maybe it would be
feasible. The City put in $700,000 for 138 units at Villa Loma; putting in a half million dollars to get 16 units plays
into the decision. Staff has to balance an Ordinance that may have been written at a time when they wanted to see one
out of every seven units built, but then Staff has to balance that against the reality. Staff has been told that there is
nobody out there looking to build or loan on a small project like this that doesn’t typically generate a lot of cash flow.
This is a small project and it will be difficult to get financing and hard to get somebody to manage. It makes it difficult
with an Ordinance with a certain ideal and a different reality.
Vice Chairperson Wellman commented that with the competitiveness of tax credits, it seems even difficult for large
units now, e.g., Laurel Tree. She added that there is no guarantee that large units will get funding.
Mr. Ruiz responded affirmatively.
Commissioner Calverley questioned the $22,000 in subsidy that was taken from the proforma the Commission saw in
February. Commissioner Calverley said that since February 1996 the revenues have changed as far as rents and does
not believe that $22,000 is anywhere near accurate as far as what the subsidy would be on these units.
Mr. Ruiz responded that the proforma has not been updated. Staff looked at the proforma as a year old; and said that
the numbers will change some but not significantly.
Commissioner Calverley stated that she believes the proforma was not accurate to begin with.
Vice Chairperson Wellman asked how much money is in the Housing Trust Fund that is not being loaned out to other
developments.
Mr. Ruiz responded that it is at about $1,700,00 right now.
Vice Chairperson Wellman commented that there are monies available in City funds to put into this project on-site.
Vice Chairperson Wellman invited the applicant to speak.
Mr. Jack Henthom, Jack Henthom & Associates, 543 1 Avenida Encinas, Suite 543 1, Carlsbad, CA 92008, addressed
the Commission and stated that the project was approved by City Council in April 1996 with positive recommendations
from both the Housing and Planning Commissions. Mr. Henthom stated that at that time the project’s conditions of
approval included language that specifically acknowledged that an alternative method to the on-site provision of
housing for this specific project was available in the form of the Policy 57/58 mechanism. Mr. Henthom said that this
project was pretty marginal back then in that the 16-unit apartment project was not being well-received by the
developers who historically do them. There was some question as to whether or not the tax credit program at that point
in time was going to change. Mr. Henthom stated that he remembers addressing the Commission in February 1996 and
stating that one of the assumptions the applicant was making when presenting the project was that the tax credit
- -
HOUSING COMMISSION MINUTES
August 14, 1997
Page 6
program was going to move to be more favorable toward smaller projects. There was a concern on the Villa Loma
project or the Villas at El Camino Real that that project might have to be funded over two tax credit years because it
was too large at that time. Unfortunately what happened was the tax credit program went through a series of evolutions
to where today there is no real priority for anything--it’s a lottery-driven program. As far as small projects go, once
you get through that initial lottery phase, and getting into some of the more discretionary things that go on with that
program, smaller projects are basically getting funded where they are either in-fill projects or they are truly rural farm-
type projects where there are other criteria to evaluate them. Basically the assumptions being made back then were that
if the tax credit program took certain evolutionary directions, this project could possibly work. That’s why at that
point, the applicant specifically said they were not asking for funding. The applicant did a proforma based on the
information provided by the development community and their own sources, which also happens to be the group that’s
doing the Laurel Tree project. Mr. Henthom expressed his confidence in the proforma.
Mr. Henthom said that the cost of getting funding for the 9 percent tax credit program that was being utilized then was
relatively low. So when you looked at small projects, spreading the cost, obtaining that funding wasn’t as critical as it
is in today’s environment where you’re dealing with a 4 percent bond issuance program. The cost of issuing bonds to
cover a deal like this on a 4 percent credit program are significant. Regarding the proforma, Mr. Henthom added that
for everything that possibly went up in revenue, there has been an increase on the cost side. Henthom therefore doubts
that there have been any changes that are significant to the proforma.
Mr. Henthom said that the developer both alone and in concert with the Staff of the Housing and Redevelopment
Department went out and tried to attract developers to this project when it became apparent to the applicant that this
project was not feasible. The applicant spoke with Bridge, Katellas, and Silverwood Developments. These developers
said that a 16-unit project did not justify participation. The interest in the project was that there were no economies of
scale, and it was not something they were interested in doing (as recent as three months ago). Mr. Henthorn added that
the minimum size project that seems to be feasible anymore is about 50 units; 50 to 100 units seems to be where the
breakpoint is roughly. As a result, the developer then came to the City and sought to have the alternative provided for
in its original project’s conditions of approval that would allow for the purchase of credits in Villa Loma. The Policy
57 Committee reviewed the project, and they recommended approval of the alternative that was in the condition.
The applicant is here with a positive recommendation from the Committee to purchase credits in Villa Loma because
the on-site proposed project is not feasible. Market-rate developers are not interested in the project. The applicant is
asking that the alternative that was put into place when the project was approved which allows purchase of credits be
recommended to the City Council by the Housing Commission.
Mr. Henthom pointed out that this project is probably the first of a bunch of these the Commission will see. He added
that Staff is beginning to look seriously at what remains in the southwest quadrant to be developed. The largest parcel
remaining to be developed south of Palomar Airport Road in the southwest quadrant, outside of the Poinsettia Shore
project, is 30 acres. There are parcels that range from two acres down to 30 acres. The rest of the land to be developed
is covered by Master Plans and covered by agreements with the Villa Loma project, the Aviara project. In Zone 2 1, the
largest parcel is a mitigation bank parcel. According to Mr. Henthom, the Commission is going to see a number of
projects coming forward with this very same issue. The best thing that can happen in this instance, is to look to an
alternative like this to provide a funding mechanism to have somebody come in and continue to explore the provision
of affordable housing in increments that are viable--in 40-, 50-unit increments. The goal of having every sixth unit in a
development be affordable has been acknowledged as being laudable, but not achievable. Mr. Henthom pointed out
the condominium alternative using the Sambi project and the lack of progress on the condo deal. There is a lot of
litigation with the condo market right now, according to Mr. Henthom. Mr. Henthom stated that he happens to
represent a lot of properties in the southwest quadrant, and he will be coming before the Housing Commission probably
40 times with the same issue. He added that this is a 30-acre parcel and one of the larger remaining developable
parcels in the whole southwest quadrant. Mr. Henthorn is asking for the recommendation of the Staff and the Policy 57
HOUSING COMMISSION MINUTES
August 14,1997
Page 7
Committee to allow this project to make its contribution to the implementation of the City’s Housing Element through
the payment of the funding to purchase the credits in the Villa Loma project.
Vice Chairperson Wellman asked if there were any questions of Mr. Henthom.
Vice Chairperson Wellman asked if the cost of purchasing units in Villa Loma is considerably less than what the
applicant would have to pay to develop on-site in some form.
Mr. Henthom responded it is about a wash.
Vice Chairperson Wellman asked if the City provided the necessary funding, would that resolve the feasibility issue in
building the apartment units.
Mr. Henthom responded that it would resolve the financial feasibility issue, but not the land use issues.
Vice Chairperson Wellman stated that there are many more non-profit developers than the three that Mr. Henthom
contacted. Those developers the applicant inquired of tend to do large projects. Vice Chairperson Wellman added that
there are developers that do smaller projects, including local developers in Carlsbad and a group in Escondido. Vice
Chairperson Wellman asked Mr. Henthom if he inquired of any of the smaller developers.
Mr. Henthom stated that their concern was to get someone in who understood tax credits and who could bring the
funding to the project to make it happen. Mr. Henthom said one of the keys is knowing how to deal with other
components of the financing. Taking the tax credit aspect away creates other problems because now you have to go
look for traditional funding sources. If you ask any of the non-profits, it’s very, very scarce; and when you can find
them, they are very difficult to deal with and very costly.
Vice Chairperson Wellman commented that there is a funding source with City funds.
Mr. Henthom responded it depends on how much money the City wants to put into the deal. He added that it is an
economy of scale thing.
Vice Chairperson Wellman commented that the Commission needs to discuss these kinds of units--big units, small
units, integrated units, units in a certain area, etc.
Mr. Henthom agreed that there are a number of policies that have to be addressed as future development continues in
this area. He added what the Commission is seeing tonight is just the beginning.
Commissioner Latas inquired about the number of times Mr. Henthom will be coming before the Commission with
other projects and asked if all the projects will be in the 50- to loo-unit range.
Mr. Henthom responded that some projects will be relatively small, like this project with 17 units. There are some
parcels that will not handle much more than 17 or 18 units. Probably the largest increment of development will be in
the vicinity of 25 to 30 units on any individual property, unless other properties get a density bonus or want to do
apartments or possibly do a combined Inclusionary project.
Commissioner Calverley asked about the density bonus the applicant received on this property to cover costs to provide
the affordable housing. She also asked about the size of the lot onto which the applicant was originally going to build
the affordable units.
HOUSING COMMISSION MINUTES
August 14, 1997
Page 8
Mr. Henthorn responded that the density bonus goes away if this project is approved as presented tonight. In response
to the second question, Mr. Henthom said the lot is about one acre.
Commissioner Calverley commented that the applicant paid $1,300,000 for the 3 1 acres in 1989. She questioned the
applicant’s improvement costs of three quarters of a million dollars for grading one acre of land.
Mr. Henthom stated that the proforma on the entire site shows the costs. He added that the proforma is valid and was
reviewed by Staff. He suggested comparing this proforma to the Laurel Tree site or some other project, adding that
there are other projects it can be compared to. The applicant’s proforma has been compared with the Laurel Tree
proforma according to Mr. Henthorn.
Commissioner Calverley commented that she would like to see the proforma.
Mr. Henthom commented that if one cannot get a developer to build the project, the numbers on the proforma mean
nothing.
Commissioner Scarpelli asked about the rollback number of the 92 homes.
The way the City calculates their density program, with 116 total units, the project rolls back to where the aggregate
number of units in a project would be 96; therefore, the 92 number is the rolled backed number according to
Mr. Henthom.
Vice Chairperson Wellman asked the Commission if they had a chance to see where the development is located.
Mr. Ruiz displayed a map showing the Commission the location of the applicant’s project. The apartments, if built,
would be located in the southwest comer. Mr. Henthom answered questions the Commissioners had about the location
of the project in relation to other streets in the area. Mr. Henthom explained that there is a SDG&E easement located in
the area in addition to a large slope making some of the area unavailable for roads.
There being no other persons desiring to address the Commission on this topic, Vice Chairperson Wellman declared the
public testimony closed and opened the item for discussion among the Commission members.
Commissioner Scarpelli commented that this project has raised some concern regarding the availability of other
property for affordable housing. Commissioner Scarpelli wonders if the Commission has looked at all the alternatives
before passing on this recommendation. Initially Commissioner Scarpelli agreed with Staffs recommendation. He
added that if a project of this size (92 homes without the density) cannot get affordable housing, then we are in serious
trouble. And if there are not very large projects in the southwest quadrant to look at, the Commission needs to
seriously evaluate this project for other alternatives or solutions.
Vice Chairperson Wellman commented that she has similar kinds of reservations. She commented that the
Commission needs more evidence to review the feasibility issues. Vice Chairperson Wellman said that by using
different sources of funding other than tax credits, there may be other ways to build the apartments or something else
on-site. She commented about the findings of the Policy 57 Committee of there not being enough transportation and
said this is in a state of flux in Carlsbad right now with different proposals with North County Transit. She added that
she does not find the worksheet particularly helpful. In looking at the worksheet and the information that was
presented on this project, she would answer the questions differently to show that this project could be developed on-
site, She added that the Commission needs more study if there are a lot more of these types of projects coming before
the Commission. If the Commission makes a finding on this 3 l-acre project that the on-site option is not feasible, than
the next applicant with a similar sized project may think the Commission has set a policy that they will either go for
larger project of 50 or more or go to second dwelling units, which there are some reservations about. It seems nobody
HOUSING COMMISSION MINUTES
August 14, 1997
Page 9
is building many apartments, even though most low-income people are in apartments because that is what they can
afford. Vice Chairperson Wellman added that just because the City got such a good financial deal with Villa Loma,
they should not rule out considering spending more than $10,000 per unit on other projects. Vice Chairperson Wellman
would like to see affordable housing integrated in the quadrant in smaller developments.
Commissioner Scarpelli asked the applicant if he had looked at the feasibility of working something together with the
developers of Laurel Tree and this property.
Mr. Henthorn responded affirmatively and explained one of the alternatives that is available is working with the
Mariner’s Point project which had 300 units at one time until the school district acquired part of the site. They had an
obligation of approximately 90 units, and 175 of those units went away when the school district acquired the site. This
made available 19 additional units in the Laurel Tree project. Mr. Henthom stated they explored with them the
possibility of participating in those 19 units. They are amenable to that. It is a viable alternative. They control the
credits. The applicant has discussed this with Staff. It has already been approved with a specific plan amendment, and
when the Laurel Tree project was approved, it was approved as a combined site for Zone 20.
Commissioner Scarpelli asked why this option was rejected.
Ms. Fountain responded that it was a Staff decision, because whether the applicant goes with Villa Loma or Laurel
Tree, they are going off-site either way. Staff felt more comfortable buying credits in Villa Loma because the project is
already built and the City needs to start recovering their costs. At this point, Laurel Tree is not in need of money
except for getting the tax credits approved. Letting TRC buy into Laurel Tree is not going to help it get financed. Staff
thinks there are going to be excess units, but this has not been confirmed yet, so Staff feels more comfortable
recommending that if the applicant is going to buy credits, that they be in the Villa Loma project.
Mr. Henthom added that the money comes into the Housing Trust Fund, which ultimately ends up in Laurel Tree
anyway.
Commissioner Scarpelli asked if anybody has looked into the possibility of moving these affordable units into the other
project if Laurel Tree goes to option 2.
Ms. Fountain responded that either way the applicant is going off-site. If the hope is to get more units out of doing this,
that is something that would have to be looked at. Ms. Fountain does not know if there is a guarantee because of the
site constraints. It will probably result in getting less units if Laurel Tree goes to a condo project rather than more
units. Ms Fountain said there are a lot of unknowns with the second option.
Mr. Henthorn commented that it all boils down to being the same amount of money whether it goes to Laurel Tree
directly or whether it goes into the Housing Trust Fund--the money still ends up the same location.
Commissioner Calverley expressed her concern for projects with less than 350 units, or less than 50 affordable units,
automatically going into a combined project.
Commissioner Latas asked for a projected build-out for this quadrant to determine if Laurel Tree and Villa Loma will
take care of everything.
Vice Chairperson Wellman asked if Staff could provide the Commission with this information. Vice Chairperson
Wellman asked Staff for a report next month concerning the southwest and southeast quadrants with regard to proposed
developments and future developments to build-out; and how many affordable units will be necessary for the quadrant;
and how many of those will need to go into a combined project.
HOUSING COMMISSION MINUTES
August 14, 1997
Page 10
Ms. Fountain understands that the Commission needs information about all the market-rate projects that are in the
southwest and southeast quadrants that have requirements to do affordable housing. She asked the Commission if they
would like to know what the affordable housing number is and how it is proposing to meet the requirement or does the
Commission want information on the total number of units being proposed.
Commissioner Walker responded that the Commission wants to know what the requirements are in the quadrant in
order to see whether or not the Laurel Tree and Villa Loma projects will satisfy those requirements. Ms. Walker added
that based upon the information presented tonight, the Commission is assuming that future projects will request to be
combined projects. Assuming this, the Commission needs a number as to what the total would be in those quadrants.
Ms. Fountain stated that the City’s Growth Management Plan could provide some insight as to all the projects out there
and their maximum development potential on the site. From plans already submitted Staff has reports that show the
number of the affordable housing projects that are in process. Ms. Fountain added that Staff has been thinking about
the combined projects on a pretty regular basis. #en the Inclusionary Housing Ordinance started, everybody had an
ideal of what it looked like, and over time it has developed a little bit differently from the ideal--the market is driving
things a little bit differently. Ms. Fountain added that Staff has been thinking about being more creative, for instance,
by buying existing apartment projects and converting them so they are restricted. It appears that Staff will see small
projects coming forward not knowing how to do the project with affordable housing. She added that there has been
controversy over the second dwelling units, which at one time was considered the “savior” of the affordable housing
process. Staff is constantly thinking of alternative ways to help the developers meet their requirement and meet the
City’s goal of getting affordable housing. Ms. Fountain said Staff can pull the report together probably, but maybe not
by the next meeting. Staff may be able to provide it at the meeting in October. She expressed concern in the meantime
for the Ocean Bluff project and how they will meet their requirement, which affects them financially in being able to go
forward with their market-rate project.
Vice Chairperson Wellman requested that Staff provide the Commission with a report on the southwest quadrant by the
next meeting and a report on the southeast quadrant at the following meeting.
Ms. Fountain responded that Staff will “give it their best shot.”
Mr. Henthorn showed a desire to speak and the Commissioners wanted to get feedback from him. He said he would
like to make a request of the Commission by working with Staff to get the information to the Commission next month.
He said they have done quite a bit of work with the zone plan in this quadrant. He also said he would like to request, if
possible, to continue this item until next month and allow it to be discussed possibly in a broader context.
ACTION:
VOTE:
AYES:
NOES:
ABSTAIN:
Motion by Commissioner Scarpelli, and duly seconded, to CONTINUE TO THE NEXT
MEETING Housing Commission Resolution No. 97-O 10, recommending that the City
Council approve a request by the Ocean Bluff Partnership to purchase 16.24 affordable
housing credits in the Villa Loma Housing Project in order to satisfy the affordable housing
obligation of the Ocean Bluff Project under the City’s Inclusionary Housing Ordinance.
7-o-o
Calverley, Escobedo, Latas, Rose, Scarpelli, Walker, Wellman
None
None
ANNOUNCEMENTS:
Ms. Fountain gave the status of Laurel Tree and said there has not been a formal announcement yet as to all the final
allocations from the Tax Credit Allocation Committee, but added that things are looking a little bit more favorably right
Minutes of: HOUSING COMMISSION
Time of Meeting: 6:00 P.M.
Date of Meeting: SEPTEMBER 11, 1997
Place of Meeting: CITY COUNCIL CHAMBERS
CALL TO ORDER:
Vice Chairperson Wellman called the Regular Meeting to order at 6: IO p.m.
PLEDGE OF ALLEGIANCE:
The pledge of allegiance was led by Commissioner Scarpelli.
ROLL CALL:
Present: Vice Chairperson Wellrnan and Commissioners Calverley, Latas, Rose, Scarpelli, and Walker
Absent: Commissioners Escobedo, Noble, and Schlehuber
Staff Present: Debbie Fountain, Acting Housing and Redevelopment Director
Craig Ruiz, Management Analyst
Leilani Hines, Management Analyst
Bobbi Nunn, Housing Program Manager
APPROVAL OF MINUTES:
ACTION: Motion by Commissioner Scarpelli, and duly seconded, to approve the Minutes of the
Regular Meeting of August 14,1997, as submitted.
VOTE:
AYES:
NOES:
ABSTAIN:
6-O-O
Calverley, Latas, Rose, Scarpelli, Walker, Wellman
None
None
COMMENTS FROM THE AUDIENCE ON ITEMS NOT LISTED ON THE AGENDA:
There were no comments from the audience.
NEW BUSINESS:
1. OCEAN BLUFF - Application to purchase affordable housing credits in the Villa Loma housing project.
Craig Ruiz stated that last month the Commission requested that Staff give a report about the potential build-out of the
southwest quadrant to determine if there were sufficient excess units in the combined projects of Villa Loma and Laurel
Tree to support future development within the southwest quadrant.
Mr. Ruiz explained the City’s Facility Management Zones, in particular, the I 1 zones within the southwest quadrant.
He then thoroughly discussed the Exhibit 3 spreadsheet which each Commissioner received in their packet. Staff found
that there can be a total of 38 13 units built within the southwest quadrant (page 3 of Exhibit 3). Of those projects that
are greater than seven units, there will be 1,148 units that will have an obligation to provide Inclusionary units. Fifteen
percent of the 1,148 units indicates a need to provide 172 Inclusionary units.
Mr. Ruiz stated that there are 159 excess units available to be purchased in the Villa Loma project, and the Laurel Tree
project has 17 units which are going to be available for purchase; making this a total of 176 credits for sale for people
in this quadrant. Based on a worse-case build-out situation, there is only going to be a need for 172 units, leaving a 4-
unit surplus based on Staffs report. One important caveat, Mr. Ruiz said, is that Staff uses the “growth control
HOUSING COMMlSSlOi MINUTES
SEPTEMBER 11,1997
PAGE 2
management point,” which typically is the maximum somebody can get. Through practice Staff has found that very
few projects achieve this maximum. In all likelihood then, the 1,148 would be a lower number; therefore, the future
number of units to be produced would be a lower number as well.
Mr. Ruiz added that one of the concerns Mr. Henthom raised last month was that there are numerous projects with less
than 10 Inclusionary units in this quadrant. Mr. Ruiz stated that there are only six projects that have more than 10
Inclusionary units. Staff is therefore still recommending that the request be approved for the purchase of 16 affordable
housing credits in the Villa Loma project.
Vice Chairperson Wellman asked if there were any questions of Staff.
Commissioner Calverley asked about the Laurel Tree project.
Mr. Ruiz stated that Laurel Tree got tax credit approval for the rental project and the escrow is moving forward.
Commissioner Calverley asked about the amount of money currently in the Housing Fund, in particular the $7 million.
Mr. Ruiz responded that the amount of money available that could be spent today on projects is approximately $1.7
million. Mr. Ruiz added that the $7 million Commissioner Calverley is referring to includes money that has been
encumbered for other projects.
Commissioner Calverley asked for a breakdown of this money.
Mr. Ruiz stated that the Finance Department provides either on a monthly or quarterly basis an accounting of these
funds.
Vice Chairperson Wellman asked about the need for units in the southeast quadrant.
Mr. Ruiz stated that Staff is working on a report on the southeast quadrant for next month. He added that there are two
primary projects, one of which is the Ranch0 Carrillo project, which will be presented tonight; the other being The
Villages of La Costa. There is a lot of land that will not be developed that will be set aside for the Habitat Management
Program, which is part of The Villages of La Costa. Two smaller projects--the Mariano project and the Bressi Ranch
‘project--will each have about 50 units each in this quadrant, he said. These four projects and a few small subdivisions
will take up just about all of the developable land.
Vice Chairperson Wellman asked whether the City Staff has independently confirmed Mr. Henthom’s data.
Mr. Ruiz responded affhmatively.
Vice Chairperson Wellman invited the applicant to speak.
Mr. Robert Wineteer, General Manager, Ocean Bluff Partnership, 7825 Fay Avenue, Suite 200, La Jolla, addressed the
Commission and asked the Commission to accept Staffs recommendation for approval to go off-site.
Vice Chairperson Wellman asked if there were any questions of Mr. Wineteer.
Commissioner Calverley asked if Mr. Henthom had checked with some smaller, local non-profits for their assistance in
building these units.
Mr. Wineteer stated that his understanding is that the project is not large enough in scope.
- -
HOUSING COMMISSION MINUTES
SEPTEMBER 11, 1997
PAGE 3
Vice Chairperson Wellman asked if the year-old proforma had been updated.
Mr. Wineteer stated that Mr. Henthom is coordinating the proforma with the architect and engineer.
Ms. Fountain added that she asked Mr. Henthom about the proforma, and he stated that the numbers he provided
before are still accurate.
Vice Chairperson Wellman responded that up-to-date data would strengthen any future applications.
Vice Chairperson Wellman opened the item for discussion among the Commission members,
Commissioner Scarpelli stated that the Commission tabled this item from last month because of concern about the
situation in the southwest quadrant. Based on a review of what has been presented and approved by the Staff,
Commissioner Scarpelli stated that his concerns have been satisfied.
Commissioner Calverley stated that she would like to verify the numbers on the proforma with Mr. Henthom. She said
that her major concern is that in purchasing credits in Villa Loma, the City is still not providing affordable units.
Commissioner Calverley stated that she contacted Villa Loma and found out that there are 50 people on the waiting list
for one bedroom units, 40 families on the waiting list for two bedroom units, and 30 families on the waiting list for
three bedroom units; so there are 120 families the City is not providing units for. To continue to throw cash at it, does
not take care of the problem, she said. She suggested to the applicant tabling this item until the Commission can get a
better feeling as to the cost of these units and exactly why the applicant cannot currently build them, and what the other
alternatives are for this project, i.e., apartments, for-sale units, etc.
Vice Chairperson Wellman stated that she shares Commissioner Calverley’s concerns and stated the Commission needs
updated information to determine if the 16-unit apartment complex is not feasible. Vice Chairperson Wellman also
suggested continuing this item until next month and asked how the applicant felt about this.
Mr. Wineteer stated that it would be wise to have a continuance.
Mr. Ruiz asked for clarification of the data that Commissioner Calverley is requesting.
Commissioner Calverley responded that one of the charges of the Commission is to evaluate the financial
considerations of the projects presented to them. She said she would like to see an evaluation of doing the apartment
project and doing for-sale units; and if these do not work, she would like to know why. She added that both types of
projects can be done locally.
Vice Chairperson Wellman added that Staff can phone the Commissioners next week if they need further clarification.
ACTION:
VOTE:
AYES:
NOES:
ABSTAIN:
Motion by Commissioner Rose, and duly seconded, to CONTINUE to next month
Resolution No. 97-O 10, recommending that the City Council APPROVE a request by the
Ocean Bluff Partnership to purchase 16.24 Affordable Housing Credits in the Villa Loma
housing project in order to satisfy the affordable housing obligation of the Ocean Bluff
development under the City’s Inclusionary Housing Ordinance.
6-O-O
Calverley, Latas, Rose, Scarpelli, Walker, Wellman
None
None
HOUSING COMMISSION MINUTES
OCTOBER 23,1997
PAGE 6 DRAFT
Chairperson Schlehuber asked if there were any questions of Staff.
Commissioner Latas asked for clarification of the numbers. Mr. Ruiz clarified the numbers for him as stated in the
paragraph above.
3. OCEAN BLUFF - Application to purchase affordable housing credits in the Villa Loma housing project.
Mr. Craig Ruiz stated that this project is a request by the applicant to purchase affordable housing credits in the Villa
Loma project. Previously they had been approved to build a 16-unit apartment project on their property to satisfy their
Inclusionary Housing obligation, and now they are requesting to purchase credits. It is the developer’s statement that
due to the large subsidies to develop the apartment project, it would be fmancially unfeasible to construct.
This item has been continued twice by the Commission. When the project was fast presented, a question was raised
about the future projects if this project purchased credits. This inquiry resulted in the two reports on the southeast and
southwest quadrants. At the conclusion of the first meeting it was continued again. The original Staff report had a
proforma for a rental project that was prepared in 1995, and the Commission asked for an updated rental profoima. It
was also asked that the applicant provide a proforma for a for-sale project; and the developer was asked to contact
additional non-profit agencies about developing this project. Mr. Ruiz said that the proformas are attached to the Staff
report as Attachments 3 and 4. The new rental proforma indicates that there would be a financing shortfall of
approximately $1 million; with a 16-unit project that would work out to about $60,000 per unit. The for-sale proforma
indicates there would be about an $800,000 financing gap which would require a subsidy of approximately $50,000 per
unit. Staff has looked at the proformas and done some analysis of them, and they seem acceptable as far as the
numbers provided. Mr. Ruiz said that the developer, as requested, contacted an additional non-profit organization-- .
Community Housing of North County--who indicated that due to the small size of the project they would not be
interested in developing the project because it would not be financially feasible for them.
As stated at the two previous meetings, it is Staffs opinion that there is adequate justification to support the request to
purchase credit in Villa Loma. The subsidies needed to develop the project make the development unfeasible and
would not be the best use of the Housing Trust Fund. Compared with projects the City has done in the past with
subsidies of between $5 and $11,000, this project would not be acceptable, he said. As shown in the two quadrant
reports, there are credits available that can be purchased by this project, therefore, Staff continues to recommend this
project.
Chairperson Schlehuber asked if there were any questions of Staff.
Commissioner Rose asked how many units are still available at Villa Loma.
Mr. Ruiz responded that there are currently 157; and if this project is approved, there will be 141.
Chairperson Schlehuber invited the applicant to speak.
Mr. Jack Henthom, Jack Henthom and Associates, 543 1 Avenida Encinas, Suite J, Carlsbad, addressed the
Commission and asked for the Commission’s acceptance of Staffs recommendation. He stated that he has responded
to the Commission’s request for additional information and would be happy to answer any questions Staff may have.
Chairperson Schlehuber asked if there were questions of the applicant.
Commissioner Walker asked about the non-profit the applicant contacted.
HOUSING COMMISSION MINUTES
OCTOBER 23,1997
PAGE 7 DRAFT
Mr. Henthom responded that the ideal situation seems to be about 50 units. After getting over 25, it starts to become
more feasible, and the closer you get to 50 the more feasible it becomes.
Commissioner Calverley asked for clarification of the “required local subsidy per affordable unit” of $92,775.
Mr. Henthom responded that the $92,775 includes a subsidy from the developer of $432,000.
Commissioner Calverley asked for clarification of what it will cost to build each one of the units.
Mr. Henthom responded that the total project cost per unit is $172,000. Mr. Henthom added that the numbers are high
for the Laurel Tree project as well; and said there are a number of fixed costs that go into the project and added that the
data is straight out of the computer as though it were prepared for a tax credit project.
Commissioner Calverley said she cannot imagine not being able to build these 16 units at a lower cost because the
developer is not using marble or granite or building fireplaces.
Mr. Henthom said that the hard construction costs are $82,000.
Commissioner Calverley asked that for future projects the Commission get this information weeks before the meeting
instead of five hours before the meeting so that the Commissioners have time to thoroughly review the data.
There being no other persons desiring to address the Commission on this topic, Chairperson Schlehuber declared the
public testimony closed and opened the item for discussion among the Commission members.
ACTION:
VOTE:
AYES:
NOES:
ABSTAIN:
Motion by Commissioner Walker, and duly seconded, to ADOPT Resolution No. 97-O 10,
recommending that the City Council APPROVE a request by the Ocean Bluff Partnership to
purchase 16.24 Affordable Housing Credits in the Villa Loma housing project in order to
satisfy the affordable housing obligation of the Ocean Bluff development under the City’s
Inclusionary Housing Ordinance.
7-1-o
Escobedo, Latas, Noble, Rose, Scarpelli, Schlehuber, Walker
Calverley
None
4. POINSETTIA PROPERTIES - Request for conceptual review of Affordable Housing Component of Poinsettia
Properties Specific Plan.
Mr. Craig Ruiz stated that this project is a Specific Plan that has been submitted to the City and his presentation is a
conceptual review of the affordable housing project. Mr. Ruiz said Staff is not asking for any approvals of any specific
projects. A Site Development Plan for an affordable project and an Affordable Housing Agreement will be brought
before the Commission at a later date.
Mr. Ruiz said that this Specific Plan is composed of eight planning areas and is located at Poinsettia and I-5. He
described Planning Area 1 as a commercial area. Planning Areas 2 and 4 are going to be single-family residential
homes. Planning Area 3 is going to be open space or a recreation area for the two single-family areas. Area 5 is going
to be the site of the affordable housing project. Area 6 is going to be a mixed-use project with first floor commercial
with the ability to do apartment units upstairs. Area 7 is going to be market-rate apartment units. The Specific Plan
allows Area 8 to either be developed as multi-family apartments or for-sale condominiums. The Specific Plan also
allows that the developer to do second dwelling units in Areas 2 and 4; and they would be allowed to do 20 percent,
which would be a maximum of 30 second dwelling units if they build out to the maximum of 857 market-rate units.
Planning Area 5 is the affordable housing project; the density there would apply a maximum of 142 units, but it will
17