HomeMy WebLinkAboutContracts & Agreements_48-2022State of California
Department of Housing and Community Development
Committee Date 03-10-2022
Business Consumer Services and Housing Agency
Award Date: 03-14-2022
Contract No 21-HK-17166
Homekey Round 2 Project Report
Project Name Redlands Good Nite Inn
Project Address 1675 Industrial Park Ave
Project City Redlands State CA Zip. 92374
Project County San Bernardino Geographic Set Aside Southern California
Applicant #1 Name' City of Redlands
Type Of Organization City
Applicant #1 Contact Paul T Barich
Applicant #1 Address 35 Cajon Street, Suite 200
Applicant #1 City Redlands State' CA Zip 92373
Co -Applicant #1 Name Shangri La Industries
Type Of Organization For profit Corp
Co -Applicant #1 Contact Delia Wahab
Co -Applicant #1 Address 660 South Figueroa Street, Suite 1888
Co -Applicant #1 City Los Angeles
Co -Applicant #2 Name Step Up on Second Street, Inc
State CA Zip 90017
Type Of Organization' Non-profit Corp
Co -Applicant #2 Contact Tod Lipka
Co -Applicant #2 Address 1328 Second Street
Co -Applicant #2 City Santa Monica State CA Zip• 90401
Prepared By David Hufford PDI Housing Representative
Project Summary
Other HCD Funding
Sources
Resubmittal Prior Rd
Type of Tax Credits
Market Rate Units
Rural
Scattered Site
No
No
None
No
No
No
Total Homekey Capital Award
$24,142,000
Total Homekey Operating Subsidy Award
$5,858,000
Maximum Homekey Award
$30,000,000
Redlands Good Nite Inn is a 99-unit hotel conversion project with 98 studio units and one manager's unit located in the City of Redlands Eleven units will be dedicated for mobility aural and visually
impaired tenants The project will provide permanent supportive housing and serve individuals experiencing homelessness chronically homeless or at -risk of homelessness with incomes equal to or
less than 30 percent of Area Median Income (AMI) Each unit will be furnished with a twin bed dresser a drop leave table with four chairs smart TV microwave adaptable kitchenette heating and
air
The development consists of one single -story and two two-story buildings housing the tenants that will also have access to a supportive services space community room computer center, two coin
operated washer and dryers and 94 parking spaces Off -site amenities located within 1/5 mile of the project include transit, a full-scale grocery store and a pharmacy
Project Description
Project Type. Permanent Housing Eligible Uses Capitalized Operating Subsidies
Building Type. Hotel
Eligible Projects Conversion of Nonresidential Structures
Number of Doors at Acquisition 100 Number of Units Proposed in the Project: 99
Number of At -Risk of Homelessness Units 37 Number of Chronically Homeless Units.
Number of Homeless Youth or Youth at Risk of Homelessness Units 0
Homekey Capital Award $16,100,000
Homekey Capital Contribution (1 1 match) $8,042,000
Bonus Award (App Submittal). $0
Homekey Relocation Costs $0
Total Homekey Capital Award $24,142,000
Bonus Award (App Submittal) $990,000 Operating
Bonus Award (Full Occupancy) $980,000
Number of Assisted Units 98
25 Number of Homeless Units 36
Property Management. Step Up on Second Street, Inc
General Contractor Shangri-La Construction LP
Supportive Services Provider Step Up on Second Street, Inc
Architect. Bardovi Architects
Consultant: N/A
Construction Start Date 1/1/2022
Construction Completion Date. 9/1/2022
Total Homekey Operating Subsidy $5,858,000 Site Control A sales contract or other enforceable agreement for the acquisition of the property
Total Homekey Funds Requested $30,000,000
Total Development Cost. $35,317,419
Homekey Capital Award per Unit Cost: $243,859
Total Cost per Unit: $356,742
Sources of Development Funds
Land Area (acres) 2.08 Total Residential Area (sq ft.) 32,175
No of Residential Building' 3 Number of Elevators 2
Funds
Committed
Yes
HCD Homekey
Source Name
Source Type
State-HCD
Lien
No
N/A
Funding Amount
$24 141 999
Interest Rate
Repayment Terms
Type
Rate
Type
Due In
(yrs.)
Req Debt
Service Amount
Yes
Acquisition and Construction Loan
Private
0
$10,270,620
Fixed for Term
5.0%
Amortized with Call
1.5
$501,439
Yes
GP Equity
Private
0
$904,800
0
0%
0
0
$0
Totals
$35,317,419
Unit Mix
# of
Bdrm at
Acq
0
No of
Doors at
Acq
100
# of
Bdrm
Proposed
0
No of Units
Proposed
98
Unit Size
(sq ft.)
325
AMI
Income
Limit
30%
Mgr
Units
0
Restricted
$414
Proposed
Avg Rent for
Restricted
Units
$200
Unrestricted
$0
Target Population
At -Risk of
Homelessness
37
Chronically
Homeless
25
Homeless
36
Homeless Youth or Youth at
Risk of Homelessness
0
0
0
0
1
325
None
1
$0
$0
$0
0
0
0
0
100
99
37
25
36
0
NOFA. September 9, 2021
1 of 3 26 City of Redlands Redlands Good Nite Inn PR
State of California
Department of Housing and Community Development
Committee Date: 03-10-2022
Business, Consumer Services and Housing Agency
Award Date: 03-14-2022
Contract No: 21-HK-17166
Match
Doors
Actual Cost
Per Unit ($)
No.
Doors
Homekey Match
Contribution Per
Unit (s)
Grantee Match
Contribution Per
Unit ($)
Homekey
Contribution ($)
Grantee Match
Contribution +
Additional
Match Amount
($)
For Capital match exceeding min.
match requirement ($10,000 per point)
Additional Capital Ma ch Required for
Application Points
Additional Grantee
Match Amount ($)
Additional
Awarded Pts.
Studio or One -Bed, Baseline $150,000
$344,115
74
$81,232
$112,883
$6,011,192
$8,353,344
$2,342,153
3
Assisted Units for those experiencing Chronic
Homelessness, Baseline $200,000
$394,115
25
$81,232
$112,883
$2,030,808
$2,822,076
$791,268
Totals
99
$8,042,000
$11,175,420
$3,133,420
3
Operating Subsidies
Applicant Operating
Subsidy Sources
Subsidy Amount
($)
Verified?
Assisted Units
App.
Score
Monthly $ Limit
per Unit
Unit
Count #
Duration of
Homekey
Operating
Subsidy
(2 or 3
years)
Homekey
Operating
Subsidy Award
Amount Total $
Years of Commitment of non -
Homekey Operating Funds
(If 2 years from Homekey, 3 from
match, If 3 from Homekey 4
from match)
City of Redlands General
Fund
$3,573,485
Yes
Chronic Homeless, Homeless
Youth, Youth at Risk of
Homelessness
162.5
$1 400
25
3
$1,260,000
4
Shangri-La LLC
$5,239,046
Yes
Other Assisted Units
$1,000
73
3
$2,628,000
Totals $8,812,531
Notes
1 Total Budgeted Developer Fee: $500,000
98
Homekey Operating Subsidy (lesser of Need Analysis and Max Homekey Amount)
$3,888,000
$3,888,000
NOFA: September 9, 2021 2 of 3 26. City of Redlands Redlands Good Nite Inn PR
State of California
Department of Housing and Community Development
Committee Date 03 10-2022
Business Consumer Services and Housing Agency
Award Date.
Contract No 21 HK-17166
Scoring Catego
Maximum Point
Points Awar
1 Ability to expend funds timely and
demonstration of operating leverage
a Site control
20.0
20.0
b Commitment of non Homekey rental or operating subsidies
20.0
19.0
a Development, ownership, or operating experience
25.0
25.0
2 Experience
b Service provider experience
15.0
15.0
c Commitment letter or MOU
15.0
15.0
3 Racial equity and Community Engagement
a Racial disparities analysis
10 0
5.0
b Community engagement
10.0
2.5
a Serves specific sub populations
20.0
20.0
b Assisted units include units for large family housing types
10 0
0 0
c Commitment to 55 year deed restriction to serve target population
20.0
20.0
d Commits to being accessible to persons with disabilities
10.0
0.0
4 Community impact and site selection
e Proposed project requires no rehab or construction or the rehab./construction and full
occupancy can be completed with eight months of award
10.0
10.0
f Applicant's capital match exceeds the minimum match required per Assisted Unit or
average total cost per Assisted Unit is below the minimum baseline per door
10.0
3.0
g Site selection
12.0
8.0
5 Negative Points
a For any project resulting in permanent displacement of residents
20.0
0.0
Total
207 0
162.5
Feasibility Analysis
Sponsor Experience
Shangri La Industries LLC is the project's development partner with more than $300 million in private capital committed to sheltering, rehabilitating and improving the lives
of the underserved Shangri La Industries has developed over 1 000 units of affordable housing including two projects in Homekey Round 1 Shangri La Industries, LLC will
partner with Step Up on Second Street Inc. a supportive services provider and property manager with over 35 years of experience serving individuals who suffer from
chronic homelessness and mental health issues Step Up on Second Street Inc is a property manager for 16 exisiting permanent supportive housing properties and a
service provider for 21 permanent supportive housing properties, with 3,000 people served at their properties in 2019-2020 Shangri-La Industries LLC and Step Up on
Second Street Inc are supported by the lead applicant the City of Redlands through operating funding
Environmental Risks
A Phase I Site Assessment dated November 19 2021 was prepared by Partner Engineering and Science, Inc in accordance with ASTM Standard E1527-13 which found
the subject property owner should continue to monitor the mitigation abnbbbd clean up activities of the regional plume that the subject property lies within, and comply with
the requirements of the oversight agency the Regional Water Quality Board No further action recommended by applicant however it is recommend the City of Redlands
continues to monitor plume.
Note If other federal funding then NEPA is required
Relocation
Based on an initial review of accompanying documents including a Phase I Site Assessment dated November 19, 2021 Appraisal dated December 21 2021 and relocation
assistance narrative from City of Redlands that state the project site known as the Redlands Goon Nite Inn is in the process of being voluntarily sold to partner, Shangri La
Industries and will not result in the displacement of any persons, businesses,or farm operations due to Homekey-funded activities Once escrow closes the proposed
property will be 100% vacant therefore relocation is not required pending Legal approval once project has been awarded
Special Conditions
1 CEQA and NEPA Applicant shall provide all environmental clearances and documents to support CEQA exemption Grantee must determine if NEPA is applicable to the
project and submit either NEPA completion documentation or NEPA exemption documentation prior to disbursement of funds
2 Grantee must provide satisfactory proof of General Liability Insurance that meets the requirements in the Homekey Round 2 NOFA §800(ii) u provide satisfactory proof of
Automotive Insurance that meets the requirements in the Homekey Round 2 NOFA §800(1) and must provide satisfactory proof of Property Hazard Insurance that meets the
requirements in §800(v) prior to the disbursement of funds
Applicant Acknowledgement
Final Project Report
By signing below, Applicant acknowledges receipt of this final report and agrees that it is a representation of the project at time of award This project is subject to
further underwriting prior to disbursement of the Homekey funds Applicant further acknowledges and understands that all project changes must be reported to,
and approved by the Department Underwriting prior to fund disbursement shall be based upon final certified costs, in conformance with all applicable Guidelines
and Regulations and financial information contain, in-th€application and may be subject to change including but not limited to development costs and funding
sources /
Signature`
Name Paul T Banch
Title Mayor
Project Name Redlands Good Nite Inn
Entity Represented City of Redlands
Date 4105/2Z
NOFA. September 9, 2021
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26 City of Redlands Redlands Good Nite Inn PR