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Title:
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Loan Federal HOME Funds for Memorial Towers Affordable Housing Rehabilitation (Ordinance S-50809)
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Title
Loan Federal HOME Funds for Memorial Towers Affordable Housing Rehabilitation (Ordinance S-50809)
Description
Request to authorize the City Manager, or his designee, to enter into an Affordable Housing Loan Program agreement for up to $1 million in federal U.S. Department of Housing and Urban Development (HUD) HOME Investment Partnerships Program (HOME) funds with Memorial Towers (TC2) Senior Housing Limited Partnership, or a City-approved nominee, for the Memorial Towers affordable housing rehabilitation project, and to take all actions and execute all documents to complete the loan. Authorization is also requested for the City Controller to disburse the funds for the life of the contract. There is no impact to the General Fund.
Report
Summary
On Dec. 6, 2023, the Housing Department issued a Call for Interest (CFI) seeking proposals for the acquisition, new construction, and/or rehabilitation of affordable rental housing based on the Affordable Housing Community Priorities.
The Community Priorities are:
Acquisition, rehabilitation and/or new construction of properties that focus on homeless or special needs populations and that provide appropriate services to assist and sustain these populations; and
Acquisition, rehabilitation, and/or new construction of properties where the developer qualifies as a Community Housing Development Organization (CHDO) as defined by the HOME Program.
Procurement Information
Six proposals were received and reviewed by an evaluation committee comprised of two City staff members and one community representative. The proposals were evaluated on a 1,000-point scale based on the following criteria: Developer Experience; Project Merits/Approach; Financial Feasibility; and Project Impact. All six projects were recommended for funding, as follows:
Garfield III (Pennrose)
Osborn Pointe (Native American Connections, Inc)
Memorial Towers (National Church Residences)
Alex Apartments (Excelerate Housing Group)
Resilient Living @ Sunnyslope (Resilient Health, Inc.)
Kazan Apartments (BNB Development)
Memorial Towers, located at 1405 S. 7th Ave. (District 8), includes the rehabilitation of a 153-unit permanent affordable multifamily housing community. National Church Residences, a non-profit developer, through Memorial Towers (TC2) Senior Housing Limited Partnership, requested $1 million to assist with the rehabilitation of this project. All units will serve households with incomes at or below 60 percent of the Area Median Income (AMI) with 11 City HOME units serving households at or below 40 percent AMI. Other proposed funding for this project includes permanent debt financing and Low Income Housing Tax Credit (LIHTC) equity.
Project awards are contingent on full underwriting, environmental release of funds, commitments of other financing, and availability of federal funds. The overall loan structure will be consistent with the Housing Department's Underwriting Guidelines for affordable rental housing projects.
Financial Impact
There is no impact to the General Fund. HOME is a federally-funded program. Funding for this CFI is made available from 2023 HOME funds and a forward allocation of 2024 HOME funds. Funding commitments for projects with LIHTC equity are reliant upon receiving a LIHTC award from the Arizona Department of Housing. Funding is budgeted in the Housing Department’s CIP budget. Loan execution is anticipated for Fiscal Year 2024- 25 and the loan will be paid to the developer over a two-year period.
Public Outreach
All applicants were required to hold at least one community meeting with the surrounding neighborhood to inform them of their proposed housing development. Per the evaluation criteria, applicants that held more than one community meeting were given additional points.
Location
1405 S. 7th Ave.
Council District: 8
Department
Responsible Department
This item is submitted by Deputy City Manager Gina Montes and the Housing Department.