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HomeMy WebLinkAbout2020-01-14; City Council; ; Acquisition of 2678 Alameda Circle, an affordable housing resale unit, and expenditure of Community Development Block Grant funds in the amount of $235,000.CA Review ~ E) S~~fi R~p Meeting Date: To: From: Staff Contact: Subject: Jan. 14,2020 Mayor and City Council Scott Chadwick, City Manager David de Cordova, Principal Planner david.decordova@carlsbadca.gov or 760-434-2935 Acqui?ition of 2678 Alameda Circle, an affordable housing resale unit, and expenditure of Community Development Block Grant funds in the amount of $235,000. Recommended Action Adopt a resolution authorizing the city manager to execute all required documents to complete the acquisition of 2678 Alameda Circle, an affordable housing resale unit, expending Community Development Block Grant funds in the amount of $235,000. Executive Summary As part of the City of Carlsbad's loan documents for homes purchased through the city's lnclusionary Housing Program, the city entered into a Resale Restriction and Option to Purchase Agreement ("Agreement") on Oct. 15, 2012, with the owner of the property at 2678 Alameda Circle, in the Mulberry n_eighborhood of Bressi Ranch. This Agreement allows the city the option to purchase the property at a restricted price at the time the owner provides notice of intent to sell or transfer ownership of the property during the 30-year term of the Agreement. On May 14, 2019 (Resolution No. 2019-066), the City Council adopted the Community Development Block Grant (CDBG) Program Action Plan allowing for the city to exercise its option to purchase affordable housing resales at a restricted price and authorizing the use of CDBG funds for this acquisition. The owner of the property at 2678 Alameda Circle provided notice to the city of the intent to ' sell on Nov. 12, 2019, and the city subsequently notified the owner of its intent to exercise its option to purchase the property at a restricted price calculated to be $222,300. The city and owner subsequently entered into a purchase agreement, and escrow has been opened with the intent of completing the property acquisition by Jan. 17, 2020, but no later than Feb. 10, 2020. • Staff is recommending that the City Council authorize the city manager to execute all required documents to complete the purchase of the subject property, which includes acceptance of the grant deed, and to expend up to $235,000 in CDBG funds to cover the purchase price and all related ·escrow and other processing fees necessary to complete the acquisition. The Carlsbad Municipal Code does not provide authority to the city manager to proceed with the acquisition of property, or accept the grant deed for transfer of property ownership, without prior approval by the City Council. This action by the City Council to approve the Jan. 14, 2020 Item #2 Page 1 of 14 acquisition and expenditure of the CDBG funds will allow for completion of the acquisition process for the subject affordable housing resale unit; the city will own the property at the end of this transaction and intends to resell it at a later date to an eligible lower-income buyer. Discussion In 1993, the city adopted an inclusionary housing ordinance that requires all residential developments to include 15% of the total number of homes to be affordable to low-income households. The residential developer has the option to produce rental or ownership product to satisfy the inclusionary requirements. The Bressi Ranch developer produced ownership product to satisfy its inclusionary housing obligation; a total of 100 condominiums were developed and sold to low-income buyers. As part of these sales, the developer transferred its financial subsidy (difference between market value of the home and restricted low-income price) to the City of Carlsbad; the city then recorded a silent second loan agreement (in the amount of the subsidy) and a Resale Restriction and Option to Purchase Agreement against the property to ensure that the property remains affordable for a 30-year term, as required by the city's inclusionary ordinance. At the time an owner of a restricted condominium decides to sell the home, the city has the first option to purchase the home at a restricted price (based on low-income maximums at the time of the notice to sell). On May 14, 2019, the City Council approved the Community Development Block Grant (CDBG) Program Action Plan authorizing city staff to respond with the city's intent to exercise its option to purchase resales of affordable, restricted price homes as they become available, and to utilize CDBG funds to purchase these resale units. This action would allow the city to recapture an affordable home and then resell it to an eligible lower- income buyer. As the owner, the city will be able to place additional restrictions on the property and/or resell it at a lower price, if necessary, to create more affordable housing opportunities. This effort will also assist with the implementation of the Homeless Response Plan and the city's goals to create more affordable housing opportunities for rehousing purposes .. The owner of the affordable, restricted condominium at 2678 Alameda Circle provided notice to the city of intent to sell the unit on Nov. 12, 2019. The city responded with its intent to exercise its option to purchase the home. The restricted sales price was calculated at $222,300 and a purchase agreement was executed by the city and the owner and deposited into escrow. Per the requirements of the Resale Restriction and Option to Purchase Agreement, the city indicated its intent to complete acquisition ofthe resale unit within 90 days of the city's notice of intent to exercise its purchase option, as required per the Agreement; the city intends to purchase the home sooner in order to expend the CDBG funds in an expedited manner with an intended close date no later than Feb. 10, 2020, if the acquisition is approved by City Council. To proceed with the subject acquisition, the City Council is being asked to authorize the city manager to execute all acquisition documents, including the grant deed, and to expend CDBG funds in an amount not to exceed $235,000 for purchase of the affordable, restricted home and related acquisition costs. Jan. 14, 2020 Item #2 Page 2 of 14 Fiscal Analysis The homeowner purchased the home at Mulberry, Bressi Ranch, in 2012 at the restricted, subsidized price of $195,000. As set forth in the Resale Restriction and Option to Purchase Agreement, the restricted price for the city to purchase the affordable residential property from the homeowner at 2678 Alameda Circle in 2020 is $222,300, based on a 14% increase in low- income levels over the past seven-plus years. It is anticipated that there will be additional acquisition costs including escrow fees. Staff is requesting that the City Council approve the expenditure of CDBG funds in the amount of $235,000 to cover all acquisition costs for the subject property. The Resale Restriction and Option to Purchase Agreement states that the 6% real estate agent fee ($13,388) is to be paid to the City of Carlsbad at the close of escrow since the city is acting as the real estate agent for the purposes of this sales transaction. Funds paid at the close of escrow w ill be returned to the CDBG fund as program income to be used for the additional purchases of resale homes in the future. Next Steps All acquisition documents will be executed by the city manager, and the city will complete the purchase of the subject affordable, restricted home and subsequently record the grant deed to transfer ownership of the home to the City of Carlsbad by no later than Feb. 10, 2020, and as early as Jan. 17, 2020. The home will then be resold to another lower-income household at a later date. City staff will be returning to the City Council in March for approval of the program details for the resale of these purchased affordable housing resale units. Including this purchase, the City will have acquired five units to date, all within the Mulberry neighborhood. Environmental Evaluation (CEQA) Pursuant to Public Resources Code section 21065, this action does not constitute a "project" within the meaning of CEQA in that it has no potential to cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and therefore, does not require environmental review. Public Notification This item was .noticed in accordance with the Ralph M. Brown Act and was available for public viewing and review at least 72 hours prior to the scheduled meeting date. Exhibits 1. City Council Resolution Jan. 14, 2020 Item #2 Page 3 of 14 RESOLUTION NO. 2020-001 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, AUTHORIZING THE CITY MANAGER TO EXECUTE ALL REQUIRED DOCUMENTS TO COMPLETE ACQUISITION OF 2678 ALAMEDA CIRCLE, CARLSBAD, CALIFORNIA, AN AFFORDABLE HOUSING RESALE UNIT, EXPENDING COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS IN THE AMOUNT OF $235,000. WHEREAS, the City Council of the City of Carlsbad, California has determined that it desires to exercise its option to purchase an affordable housing resale unit located at 2678 Alameda Circle, Carlsbad, California as set forth in the Resale Restriction and Option to Purchase Agreement executed between the city and property owner on Oct. 15, 2012; and WHEREAS, the property owner for 2678 Alameda Circle provided notice to the city on Nov. 12, 2019, indicating the owner's intent to sell or transfer ownership of the restricted affordable housing unit at the noted location; and WHEREAS, the city responded to the property owner of the restricted affordable housing unit on Nov. 12, 2019, indicating its intent to exercise its option to purchase the property at 2678 Alameda Circle; and WHEREAS, on May 14, 2019 (Resolution No. 2019-066), the City Council approved the 2019- 2020 Community Development Block Grant (CDBG) Program Action Plan allowing for the city to exercise its option to purchase affordable housing resales at a restricted price and authorizing the use of CDBG funds to purchase these resale units; and WHEREAS, the purchase approval by the City Council allows for the city to recapture an affordable home and extend its affordability for an indefinite period of time, if so desired, and to resell it to an eligible buyer at a lower price, if necessary, to implement the city's affordable housing goals and policies; and WHEREAS, the purchase approval by the City Council will also assist with the implementation of the city's Homeless Response Plan and the city's goals to create more affordable housing opportunities. Jan. 14, 2020 Item #2 Page 4 of 14 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as follows: 1. That the above recitations are true and correct. 2. That the City Council hereby authorizes the city manager to execute all required documents, including the Acceptance of the Grant Deed, for the purchase of the affordable housing unit located at 2678 Alameda Circle, Carlsbad, California, and to expend CDBG funds up to $235,000 cover the purchase price and all related escrow and other processing fees to complete the acquisition. PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of Carlsbad on the 14th day of January 2020, by the following vote, to wit: AYES: Hall, Blackburn, Bhat-Patel, Schumacher. NAYS: None. ABSENT: None. Mft: HALL, Mayor ;: ~tc-frf &tirflt:z I PlpvM Ci') -ic:r BARBARA ENGLESON, City Clerk JC/ (SEAL) \\\\\\111111//IJ/11 ~''o'''~ CAFl/:l11/,:,,,. ~ ·""-~·" 'l ~-,. .. ·· ·•, .. U_AI\ ~ ~.... ·-.~~ 10~/~· \b~ = :~ . : = \ \. '·" ,~! f -:-: ·• •• 1■oci,n1•n• .·· s-~ "•••• I ,.••• ~ $° ~'-;,q ·········· ~\."f~ ~l11, 1./FO~ ,,,"'' 11//111111111111111' e,J., Jan. 14, 2020 Item #2 Page 5 of 14 DOC# 2020-0035060. 111111111111 lllll 1111111111111111111111111 IIIII IIJII 11111111111111 ~II RECORDING REQUESTED BY: Chicago Titl,e Company Jan 22, 2020 04:59 PM OFFICIAL RECORDS Ernest J. Dronen burg, Jr., SAN DIEGO COUNTY RECORDER FEES: $0.00 (SB2 Atkins: $0.00) PCOR: YES When R .. corded Mall Document and Tax Statement To: PAGES:4 City Clerks Department 1200 Carlsbad Village Drive . Carlsbad, CA 92008 Escrow Order No.: 73719013556 APN/Parcel iD(s): 213-190-04-25 SPACEABOVE THIS LINE FOR RECORDER'S USE Exempt from fee per GC 27388.1 (a) (2); recorded in connection with a concurrent transfer subject tc, the imposition of documentary transfer tax . GRANT DEED The underslg(!ed grantor(s) declare(s) @ This transfer Is exempt from th~ documentary transfer tax. "The Grant deed Is Recorded at the request and for the benefit of the C.lty of Carlsbad. and Is exemptfrom the Payment of a recording fees pursuant to Government code Sections 6103,27383 and 27388.1 and Is exempt from the Payment of documentary transfer tax pursuant to Revenue and Taxation Code Section 11922 @' The documentary transfer tax is$ --G-and is computed on: □ the full value of the interest or property conveyed. · □ · the full value less the liens or encumbrances remaining thereon at the time of sale. The property is located In @' the City ~f Carlsbad. FORA VALUABLE CONSIDERATION, receipt of which Is hereby acknowledged, Ramon Gonzalez, a married man as his sole and separate property hereby GRANT(S) to The City of Carisbad Hou'slng and Neighboorhood Services the following described real property In the City of Carlsbad, County·of San Diego, State of California: For APN/Parcel ID(s): 213-190-04-25 . A CONDOMINIUM UNIT COMPOSED OF: PARCEL 1 (COMMON AREA INTEREST): AN UNDIVIDED FRACTIONAL INTEREST AS TENANT IN COMMON IN AND TO THE COMMON AREA OF PHASE 2 AS DESCRIBED ON THE MULBERRY AT BRESSI RANCH CONDOMINIUM PLAN (THE "CONDOMINIUM PLAN") RECORDED FEBRUARY 11, 2005 AS DOCUMENT NO .. 05-117224 OF OFFICIAL RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, CALIFORNIA, BEING A PORTION Of LOT 1 OF CARLSBAD TRACT MAP CT 03-03, IN THE CITY OF Grant Dead Pr1nlsd: 12.03.19@ 12:40 PM SCA0000129.doo / Updated: 11.20.17 CA-CT-FWDC-02180.055824-73719013556 Jan. 14, 2020 Item #2 Page 6 of 14 APN/Parcel ID(s): 213-190-04-25 GRANT DEED (continued) CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 14800, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, ON MAY 21,2004. THE UNDIVIDED FRACTIONAL INTEREST HEREBY CONVEYED IS THE RECIPROCAL OF THE NUMBER OF LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN AS BEING WITHIN PHASE 2 OF THE CONDOMINIUM PLAN. EXCEPT THEREFROM ALL LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN. EXCEPT THEREFROM ALL OIL, GAS, MINERALS AND OTHER HYDROCARBON SUBSTANCES IN AND UNDER SAID LAND LYING BELOW A DEPTH OF 500 FEET FROM THE SURFACE THEREOF, BUT WITH NO RIGHT OF SURFACE ENTRY, AS PROVIDED IN THE DEED RECORDED JANUARY 25, 2005 AS DOCUMENT NO. 05-61440 OF OFFICIAL RECORDS. PARCEL 2: (LIVING UNIT): LIVING UNIT NO. 75 AS SHOWN UPON THE CONDOMINIUM PLAN. PARCEL 3: (EXCLUSIVE USE AREAS): THE EXCLUSIVE RIGHT TO USE ANY EXCLUSIVE USE AREA SHOWN ON THE CONDOMINIUM PLAN AS BEING APPURTENANT TO THE LIVING UNIT DESCRIBED IN PARCEL 2 ABOVE. PARCEL 4: (EASEMENT OVER ASSOCIATION PROPERTY): A NON-EXCLUSIVE EASEMENT FOR USE AND ENJOYMENT OF AND ACCESS OVER THE ASSOCIATION PROPERTY ("ASSOCIATION PROPERTY" IS DEFINED IN THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND RESERVATION OF EASEMENTS FOR MULBERRY AT BRESI RANCH RECORDED ON MARCH 10,2005 AS DOCUMENT NO. 05-197712 OF OFFICIAL RECORDS), EXCEPTING ANY EXCLUSIVE USE AREA. THE EASEMENTS RESERVED, WHICH IS APPURTENANT TO THE LIVING UNIT DESCRIBED ABOVE, IS FOR ACCESS AND USE OF THE ASSOCIATION PROPERTY, SUBJECT TO THE PROVISIONS OF THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND RESERVATION OF EASEMENTS FOR MULBERRY AT BRESSI RANCH AND THE RULES AND REGULATIONS OF THE MULBERRY AT BRESSI RANCH HOMEOWNERS ASSOCIATION, A CALIFORNIA NONPROFIT MUTUAL BENEFIT CORPORATION. Dated: December 3, 2019 IN WITNESS WHEREOF, the undersigned ve executed this document on the date(s) set forth below. Grant Deed Printed: 12.03.19 @ 12:40 PM SCA0000129.doc I Updated: 11.20.17 CA-CT-FWD0-02180.055824-73719013556 Jan. 14, 2020 Item #2 Page 7 of 14 APN/Parcel 1D(s ): 213-190-04-25 GRANT DEED (continued) A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of C...n\, £a< n-1 Q County of 60.0 O,e..ao On Dec:trvibec 11, J.01°1 beforeme, le)ictQ GonLalez No~Or~ f\;bl,r, ,NotaryPublic, , (here insert name ahd title of t e officer) personally appeared K. Q m \'"'\ L , who proved to me on the basis of satisfactory evidence to be the~ whose am 1 81'9-subscri to the within instrument and acknowledged to me that~ executecilliesame ir@ther4heifoo authorize capaci . ), and that by~~ on the instrument the~ or the entity upon behalf of which th erso st acted, exec~ the instrument. I certify under PENAL TY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. Signature Grant Deed SCA0000129.doc I Updated: 11.20.17 Printed: 12.03.19@ 12:40 PM CA-CT-FWD0-02180.055824-73719013556 Jan. 14, 2020 Item #2 Page 8 of 14 CERTIFICATE OF ACCEPTANCE (Pursuant to Government Code 27281) This is to certify that the interest in real property conveyed by the Grant Deed from RAMON GONZALEZ, A MARRIED MAN AS HIS SOLE AND SEPARATE PROPERTY to the City of Carlsbad, a municipal corporation (the "City"), is hereby accepted on January 15, 2020, by the undersigned officer or agent on behalf of the City pursuant to authority conferred by City Council Resolution No. 2020-001 adopted on January 14, 2020, and the City Council consents to the recordation of said document in the Office of t Recorder of San Diego County, State of California. Name: Scott Chadwick Its: City Manager Jan. 14, 2020 Item #2 Page 9 of 14 RECORDING REQUESTED BY: DOC# 2020-0035056 111111111111 lllll 11111111111111111111111111111111111111111111111111111 Chicago Tltle-SD Jan 22,. 2020 04:59 PM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., AND WHEN RECOR.OED MAILTO: . SAN DIEGO COUNTY RECORDER FEES: $40.00 (SB2 Atkins: $0.00) PCOR: N/A City Clerks Department 1200 Carlsbad Village Orlve Carlsbad, CA 92008 PAGES:5 73719013556RCM 213-190-04-25 Notlc~ of Termination of Resale Restriction Agreement and Option ,tr, ~ (Please fill in document title(s) on this line) 1 .D Exempt from fee per GC27388.1 due to being recorded in connection with concurrent transfer that is subject to the imposition of documentary transfer tax, or, 2 0 Exempt from fee per GC27388.1 due to being recorded in connection with a transfer that was subject to documentary transfer tax which was paid on document recorded previously on · (date*} as document number ___________ of Official Records, or, 3 D Exempt from fee per GC27388.1 due to the maximum fees being paid on documents in this transaction, or, 4 D Exempt from fee per GC27388.1 due to the maximum fees having been paid on documents In the transactlon(s) recorded previously on _________ (date*} as document number(s) ______________________ of Official Records, or, 5 0 Exempt from fee per GC27388.1, document transfers real property that Is a residential dwelling to an owner-occupier, or, document Is recorded in connection with concurrent transfer that is a residential dwelling to an owner-occupier, or, 6 D Exempt from fee per GC27388.1 due to it being recorded in connection with a transfer of real property that is a residential dwelling to an owner-occupier. The recorded document transferring 7~ the dwelling to the owner-occupier was recorded on _________ (date*) as document number(s} Exempt from fee per GC27388.1 due to being executed or recorded by the federal government in accordance with the Uniform Federal Lien Registration Act, by the state, or any county, municipality or other political subdivision of the state, or, 8 D Exempt from the fee per GC 27388.1 (a) (1}; Not related to real property, or, 9 [1 Rev 5/18 Exempt from fee under GC27388.1 for the following reasons: THIS PAGE ADDED TO PROVIDE SENA'TEBll12EXEMl'TION INFORMAllON (Additional recordingfeeapplies) *The Prior Recording Reference must have been recorded within the last 60 days and Is subject to review Jan. 14, 2020 Item #2 Page 10 of 14 RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO AND MAIL TAX STATEMENT TO: City Clerks Department 1200 Carlsbad Village Drive Carlsbad, CA 92008 This Notice of Termination is recorded at the request and for the benefit of the City of Carlsbad, and is exempt from the payment of a recording fee pursuant to Government Code Sections 6103, 27383, and 27388.1, and is exempt from ~he payment of documentary transfer pursuant to Revenue and Taxation Code Section 11922. (Space 1above this line reserved for Recorder's use only) NOTICE OF TERMINATION OF RESALE RESTRICTION AGREEMENT AND OPTION TO PURCHASE WHEREAS, the City of Carlsbad, a municipal corporation (the "City"), is the sole beneficiary under that certain Resale Restriction and Option to Purchase by and between the City, and RAMON GONZALEZ, (the "Owner"), dated as of October 15, 2012, and recorded in the Official Records of the County of San Diego (the "Official Records") on November 21, 2012, as Document No. 2012-0731 l 74; (the "Declaration"); WHEREAS, the Declaration encumbers certain real property situated in the City of Carlsbad, County of San Diego, State of California, as more particularly described in Exhibit A hereto (the "Property"); and WHEREAS, in accordance with the Declaration, the Owner is conveying the Property to the City, and the City desires to record this Notice of Termination of Resale Restriction and Option to Purchase (the "Notice of Termination") against the Property to evidence the termination and release of the Notice of Termination as an encumbrance against the Property. NOW, THEREFORE, the City does hereby record this Notice of Termination to confirm that the Declaration has terminated in accordance with its terms, and that the Declaration is hereby released as an encumbrance against the Property. IO I 0/17 /2367843 .2 Jan. 14, 2020 Item #2 Page 11 of 14 As of the date of the recordation of this Notice of Termination in the Official Records, the Declaration is hereby terminated by the City and is hereby released from the Property. IN WITNESS WHEREOF, the City has executed this Notice of Termination as of 2.1SAN2t> By: Name: Qof-+ CluJ.dw;c.Jc__ _______ =-..:.....:....:;_....::..;_;::....::;_ ___ _ Its: l · ~ ('via, h a_v--r= Signature must be notarized 1010/17/2367843.2 Jan. 14, 2020 Item #2 Page 12 of 14 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Diego On t?JM-, . J,/ 1 :J{)dO before me, Morgen Fry, Notary Public ' (insert name and title of the officer) personally appeared J6ott CJiad wi 0k. who proved to me on the basis of satisfactory evidence to be the person~) whose name~) ishlfe subscribed to the within instrument and acknowledged to me that he/ihetthey executed the same in his/herltAeir authorized capacity~). and that by hislftefftheir signaturets}. on the instrument the person('s)_, or the entity upon behalf of which the person('s) acted, executed the instrument. I certify under PENAL TY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature \_~~Seal} i············~ ,~' , •~ M~GEN FRY : '· ·••"e ·'. Notary Public -Californii z ~ _ · ; San Oi~o County ~ z ~ . ' Commission It 2268W5 - 0 •"'0••'• My CGmm. Expires Dec 2-4, 2022 Jan. 14, 2020 Item #2 Page 13 of 14 For APN/Parcel ID(s): 213-190-04-25 A CONDOMINIUM UNIT COMPOSED OF: PARCEL 1 (COMMON AREA INTEREST): EXHIBIT "A" Legal Description AN UNDIVIDED FRACTIONAL INTEREST AS TENANT IN COMMON IN AND TO THE COMMON AREA OF PHASE 2 AS DESCRIBED ON THE MULBERRY AT BRESSI RANCH CONDOMINIUM PLAN (THE "CONDOMINIUM PLAN") RECORDED FEBRUARY 11. 2005 AS DOCUMENT NO. 05-117224 OF OFFICIAL RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, CALIFORNIA, BEING A PORTION OF LOT 1 OF CARLSBAD TRACT MAP CT 03-03, IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 14800, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, ON MAY 21,2004. THE UNDIVIDED FRACTIONAL INTEREST HEREBY CONVEYED IS THE RECIPROCAL OF THE NUMBER OF LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN AS BEING WITHIN PHASE 2 OF THE CONDOMINIUM PLAN. EXCEPT THEREFROM ALL LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN. EXCEPT THEREFROM ALL OIL, GAS, MINERALS AND OTHER HYDROCARBON SUBSTANCES IN AND UNDER SAID LAND LYING BELOW A DEPTH OF 500 FEET FROM THE SURFACE THEREOF, BUT WITH NO RIGHT OF SURFACE ENTRY, AS PROVIDED IN THE DEED RECORDED JANUARY 25, 2005 AS DOCUMENT NO. 05-61440 OF OFFICIAL RECORDS. PARCEL 2: (LIVING UNIT): LIVING UNIT NO. 75 AS SHOWN UPON THE CONDOMINIUM PLAN. PARCEL 3: (EXCLUSIVE USE AREAS): THE EXCLUSIVE RIGHT TO USE ANY EXCLUSIVE USE AREA SHOWN ON THE CONDOMINIUM PLAN AS BEING APPURTENANT TO THE LIVING UNIT DESCRIBED IN PARCEL 2 ABOVE. PARCEL 4: (EASEMENT OVER ASSOCIATION PROPERTY): A NON-EXCLUSIVE EASEMENT FOR USE AND ENJOYMENT OF AND ACCESS OVER THE ASSOCIATION PROPERTY ("ASSOCIATION PROPERTY" IS DEFINED IN THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND RESERVATION OF EASEMENTS FOR MULBERRY AT BRESI RANCH RECORDED ON MARCH 10,2005 AS DOCUMENT NO. 05-197712 OF OFFICIAL RECORDS), EXCEPTING ANY EXCLUSIVE USE AREA. THE EASEMENTS RESERVED, WHICH IS APPURTENANT TO THE LIVING UNIT DESCRIBED ABOVE, IS FOR ACCESS AND USE OF THE ASSOCIATION PROPERTY, SUBJECT TO THE PROVISIONS OF THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND RESERVATION OF EASEMENTS FOR MULBERRY AT BRESSI RANCH AND THE RULES AND REGULATIONS OF THE MULBERRY AT BRESSI RANCH HOMEOWNERS ASSOCIATION, A CALIFORNIA NONPROFIT MUTUAL BENEFIT CORPORATION. CL TA Preliminary Report Form -Modified (Adopted: 11.17.2006) Printed: 11.26.19 @ 02:33 PM CA-CT-FWO0-02180.055820-SPS-1-19-73719013556 Jan. 14, 2020 Item #2 Page 14 of 14