HomeMy WebLinkAboutSDP 2018-0022; RESORT VIEW APARTMENTS; AFFORDABLE HOUSING DENSITY BONUS REPORT; 2019-10-15CITY OF CARLSBAD
AFFORDABLE HOUSING DENSITY BONUS REPORT Project Number: Address: APN: Owner: Date: SDP 2018-0022 (DEV 2017-0225) Viejo Castilla Way Carlsbad, CA, 92009 216-170-14-00216-170-15-00BNR Development 23800 Via Del Rio Yorba Linda, CA, 92887 (858) 546-442410/15/2019 REPORT PREPARED BY:
ST RE A fV1 LI N E � )i_ \_/ [ l_ <) f_) �\ 1[-:'\J ] ( J) ( ) 1, 1 I 'PO Box 99417 San Diego, CA, 92169 (619)609-0669
DENSITY BONUS
This project qualifies for a density bonus by providing affordable housing for low-income tenants pursuant
to CA Code 65915. Please see the table below for project specifics:
Zone RD-M
Allowable Base D ensity 16-23 Units/ Acre
Lot Size 0.858 Acres (37,375 Sq. Ft.)
Developable Area 0.858 Acres (37,375 q. Ft.)
Total Base Units* 19.73 _,. 2Q .Units
ffordable Units Provided 4 Units
% Affordable 20%
Density Bonus Permitted** 35% (1faximum 7 add'! units)
dditional Units Provided 6 Units
Total Units Provided 26 Uaitc:
*Per C4 Code 65915(0)(2) -''Maximum allowabb. midenlial density" means the density allowed 1111der
the zoning 01-di11a11ce and kmd use ekment qf the general plan, or. if a raiw of densip irpemntted
meanr th: mt1,,\:i,w11J1 allowable dwsi()ifor the rpecijic ,;_011ing raw.
**Per C4 Code 65915(!)(2)
Affordable Uaits, Units E-1, E-2, E-3 and E -6 shall be deemed affordable, outlined below in RED. We
shall provide (x3) 1-bedroom units and (xl) 2-bedroom unit, to ensure a rnix of single-bedroom and multi-bedroom
units, per the spirit of inclusionary housing policy.
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Site· LEVEL O!llfil
Previous Use. This property is currently undeveloped, with no known development projects ever being built on the
subject property. T herefore, there have been no tenants of any kind residing on this property within the last five
years.
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REQUESTED INCENTIVES
% Affordable 21 %
Affordable Income Level Low (60% AMI)
Maximum Incentives* 2
Requested Incentives 2
*Per CA Code 65915(d)(2)(B)
Incentive 1: Building Height.
Section 21.24.030 of the Carlsbad Municipal Code provides projects with a maximum building height of
35 feet. There is no limit on number of stories, only height. In order to accommodate the density allowed by the
State Density Bonus Law, this project proposes two four-story buildings, with a total maximum building height of
approximately 43' 6" for Buildings C and D.
Incentive 2: Units removed from the Excess Dwelling Unit Bank.
This project, through utilization of the CA State Density Bonus Law, is allowed 7 bonus units by providing
4 units affordable to low-income tenants. \Ve are only providing 6 bonus units, so we are requesting to remove those
6 units from the Excess Dwelling Unit Bank.
REQUESTED WAIVERS
Waiver 1: Rear Setback Encroachment.
The Carlsbad Municipal Code only provides at grade stairs to encroach no more than 2 feet into the
required setback. The stairs in the rear yard encroach between 4-5 feet into the setback.
PARKING
Per CA Code 65915(p), the following parking ratios shall apply:
Type of Unit # of Units *Req'd Parking Total Parking
per65915(p)(1) Proposed
1-bedroom 4 4 4
2-bedroom 4 8 8
3-bedroom 18 36 36
Other 0 0 1
Total 26 48 49
*Inclusive ef g11esl and handicap parking
This project contains only one-, two-and three-bedroom units, so only those parking ratios shall apply. As
indicated in the table above, this project is required to provide one (1) space per one-bedroom unit, and two (2)
spaces per three-bedroom unit. We are providing covered and enclosed parking spaces to sufficiently satisfy this
requirement.
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. . .
FEASIBILITY
Without an affordable housing component, and with it the density bonus and incentives required to
accommodate the additional density, the project will be infeasible to build. Please see the attached feasibility
executive summaries (full proformas can be provided upon request). With the density bonus, we can build 26 units;
without the density bonus we are limited to 15 units, due to the GMCP. Please see the table below for feasibility
differences:
Feasibility Measurement 15 units 26 units
Yield On Cost 5.10% 5.88%
Development Spread 60.0 bps 138.5 bps
Total Costs $8,215,548 $11,133,174
Stabilized Value $9,310,485 $14,559,348
Total IRR 9.14% 15.21%
Debt Coverage Ratio 1.10 1.24
Cash on Cash 1.9% 5.0%
With only 15 units, no banks would finance the construction of this project, and the investor wouldn't be
interested in spending the money due to such small returns. Typically, banks look for a minimum 1.2 debt coverage
ratio, 100_ bps develoment spread, 5% cash on cash, and 5.5% build to CAP rate for new builds. Investors like to
see a minimum of 5% annual cash on cash returns and 12% IRR over a 10 year hold, but prefer projects that yield
a 15% IRR over 10 years. By all metrics, this project wouldn't be viable for investment or financing at only 15 units,
the maximum yield without the density bonus.
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