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RESOLUTION NO. HA-104
A RESOLUTION OF THE PALM DESERT HOUSING AUTHORITY
APPROVING A CONDITIONAL AGREEMENT REGARDING VITALIA
BETWEEN THE AUTHORITY AND PACIFIC WEST COMMUNITIES,
INC., APPROPRIATING FUNDS IN CONNECTION THEREWITH, AND
TAKING RELATED ACTIONS
RECITALS:
A. Pursuant to AB X1 26 (enacted in June 2011) and the California Supreme
Court's decision in California Redevelopment Association, et al. v. Ana Matosantos, et
al., 53 Cal. 4th 231 (2011), the former Palm Desert Redevelopment Agency (the "Former
Agency") was dissolved as of February 1, 2012, the Successor Agency to the Palm
Desert Redevelopment Agency (the "Successor Agency"), as the successor entity to the
Former Agency, was constituted, and a board of the Successor Agency (the "Board")
was established.
B. AB X1 26 added Part 1.8 (commencing with Section 34161) and Part 1.85
(commencing with Section 34170) to Division 24 of the California Health and Safety Code
("HSC") (such Parts 1.8 and 1.85, including amendments and supplements enacted after
AB X1 26, being referred to herein as the "Dissolution Act").
C. Pursuant to HSC Section 34176(b), the City Council of the City of Palm
Desert (the "City") adopted Resolution No. 2012-07, electing for the City to not retain the
responsibility for performing housing functions previously performed by the Former
Agency, and determining that all of the assets, as allowed by law, and all rights, powers,
liabilities, duties, and obligations associated with the housing activities of the Former
Agency be transferred to the Palm Desert Housing Authority (the "Authority").
D. The Successor Agency and Pacific West Communities, Inc. (the
"Developer") entered into an Exclusive Negotiation Agreement, dated as of October 21,
2020, for the purpose of negotiating the terms and conditions upon which the Successor
Agency would sell to the Developer the approximately +/- 11.94-acre portion of real
property owned by the Successor Agency located in the City along Gerald Ford Drive and
identified as APN 694-310-006 (the "Property") for the purpose of constructing thereon
a 269-unit multi -family residential apartment community for households with incomes
between 30% and 80% of the area median income (the "Project"). The Property is
described in Exhibit "A", attached hereto and incorporated herein.
E. An appraisal of the Property was ordered from Novogradac Consulting,
LLP, received and dated March 25, 2021. The report places the current appraised value
of the Property at $4,500,000.
RESOLUTION NO. HA-104
F. The Developer has submitted a funding request to the Authority to make a
loan to the Developer in the amount of $6,030,000 (the "Loan") to assist the Developer
in the purchase of the Property from the Successor Agency and the development of the
Project. The Project is intended to be funded by leveraging multiple funding sources
including four percent tax exempt bonds, federal tax credits, state tax credits, and the
Loan.
G. The Authority, as the housing successor to the Former Agency, wishes to
approve the Conditional Agreement Regarding Vitalia between the Authority and the
Developer attached hereto as Exhibit "B" and incorporated herein by reference (the
"Agreement") which provides for the Authority to make the Loan to the Developer subject
to the terms and conditions therein.
H. At its meeting on August 26, 2021 the Board of the Successor Agency will
consider approval of a purchase and sale agreement (the "PSA") for the sale of the
Property to the Developer for a purchase price equal to its appraised value, subject to
approval of the PSA by the Countywide Oversight Board of the County of Riverside and,
if necessary, the approval or deemed approval by the State Department of Finance.
NOW, THEREFORE, THE PALM DESERT HOUSING AUTHORITY DOES
HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
Section 1. The above recitals, and each of them, are true and correct and are a
substantive part of this Resolution.
Section 2. The Agreement, in the form attached hereto as Exhibit "B", is
hereby approved. The Executive Director of the Authority is hereby authorized to
execute and deliver, for and in the name of the Authority, the Agreement in substantially
such form, with such changes thereto as the Executive Director, in consultation with the
Authority legal counsel, may deem appropriate or necessary and consistent with the
purposes of this Resolution (such approval to be conclusively evidenced by the
execution and delivery thereof).
Section 3. The Developer is hereby authorized to submit, an application,
including the Agreement, to the California Tax Credit Allocation Committee ("TCAC") for
an allocation of tax-exempt bonds, federal tax credits and state tax credits as described
in the conditional agreement.
Section 4. The Director of Finance is hereby authorized to appropriate
$6,030,000 from Unobligated Housing Asset Fund Balance to the appropriate budget line
item.
Section 5. The Authority will not be bound by the Agreement or otherwise with
respect to assisting the Project unless the Tax Credit Allocation shall have been awarded
to the Project, all other conditions described in the Agreement shall have been satisfied,
and all documents pertaining thereto (including, without limitation, the loan documentation
pertaining to the proposed construction and permanent loans) shall have been submitted
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RESOLUTION NO. HA-104
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in final form and approved by the Board, and the Board authorizes their execution and
delivery, as appropriate.
Section 6. The members of this Board and the staff of the Authority are hereby
authorized, jointly and severally, to do all things which they may deem necessary or
proper to effectuate the purposes of this Resolution, including negotiating and preparing
agreements and documents, and any such actions previously taken are hereby ratified
and confirmed.
PASSED, APPROVED and ADOPTED on this 26th day of August, 2021, by
the following vote, to wit:
AYES: HARNIK, JONATHAN, NESTANDE, QUINTANILLA, and KELLY
NOES: NONE
ABSENT: NONE
ABSTAIN: NONE
ATTES3�
/0 -
NORMA I. ALLEY, MMC, SRETARY
PALM DESERT HOI.JSING'AUTHORITY
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RESOLUTION NO. HA-104
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RESOLUTION NO. HA-104
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EXHIBIT "A"
The Land referred to herein below is situated in the City of Palm Desert, County of
Riverside, State of California, and is described as follows:
LEGAL DESCRIPTION
A PORTION OF PARCEL 1 OF THAT CERTAIN CERTIFICATE OF COMPLIANCE NO.
88-1, RECORDED JUNE 1, 1988 AS INSTRUMENT NO. 146461 OF OFFICIAL
RECORDS. IN THE CITY OF PALM DESERT, COUNTY OF RIVERSIDE, STATE OF
CALIFORNIA, LOCATED IN THE NORTHWEST QUARTER OF THE NORTHEAST
QUARTER OF SECTION 32, TOWNSHIP 4 NORTH, RANGE 6 EAST, SAN
BERNARDINO MERIDIAN, MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHWEST CORNER OF SAID PARCEL 1;
THENCE NORTH 89°55'15" EAST, ALONG THE NORTHERLY LINE OF SAID PARCEL
1, SAID LINE ALSO BEING THE SOUTHERLY RIGHT-OF-WAY LINE OF GERALD
FORD DRIVE, A DISTANCE OF 514.35 FEET;
THENCE SOUTH 47°23'23" EAST, A DISTANCE OF 34.01 FEET;
THENCE SOUTH 00°03'36" WEST, A DISTANCE OF 942.64 FEET;
THENCE NORTH 89°56'24" WEST, A DISTANCE OF 539.40 FEET;
THENCE NORTH 00°03'36" EAST, ALONG THE WESTERLY LINE OF SAID PARCEL
1 AND THE SOUTHERLY EXTENSION THEREOF, A DISTANCE OF 964.39 FEET, TO
THE POINT OF BEGINNING;
SUBJECT TO EXISTING EASEMENTS, COVENANTS, RIGHTS AND RIGHTS -OF -
WAY OF RECORD.
CONTAINING 520,257 SQUARE FEET OR 11.943 ACRES MORE OR LESS.
AS DEPICTED ON EXHIBIT "B" ATTACHED HERETO AND MADE A PART HEREOF.
THIS LEGAL DESCRIPTION DOES NOT DESCRIBE A LEGAL PARCEL OF LAND. IT
IS NOT TO BE USED FOR CONVEYANCE OR FINANCING OR ANY OTHER
PURPOSE THAT WOULD BE A VIOLATION OF THE CALIFORNIA SUBDIVISION MAP
ACT.
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RESOLUTION NO. HA-104
EXHIBIT "B'
GERALD FORD DRIVE
N 89'55'15. E 514.35'
P.0 RJ 5 4T23'23" E--//‘ Q
NW COR PARCEL 1 34 01'
CERTIFICATE OF COMPLIANCE Y
NO. 88-1 1NST NO. 1988-1464b1 CC
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MSA CONSULTING, INC.
' PLANNING CIVIL ENGINEERING>. LAND SURVEYING
34200 80B HOPE DRIVE, RANCHO MIRAGE, CA 92270
760320.9811 MSACONSULTINGINC.COM
J.N. 2619
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PORTOLA AVENUE
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RESOLUTION NO. HA-104
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EXHIBIT "B"
CONDITIONAL AGREEMENT
September 1, 2021
Caleb Roope
Pacific West Communities, Inc.
430 East State Street, Suite 100
Eagle, ID 83616
Subject: Conditional Aareement Reaardina Vitalia Apartments
Dear Mr. Roope:
The Palm Desert Housing Authority (the "Housing Authority"), has approved a request
from your firm, Pacific West Communities, Inc. ("Pacific West"), to finance a loan for the
purchase of a +/-11.94-acre portion of APN 694-310-006 (the "Property"), located on the
south side along Gerald Ford Drive at the intersection of Rembrandt Parkway directly east
of the Riverside County Sheriff Station for the fair market price (as established by a third
party appraiser), in the total amount of Six Million Thirty Thousand Dollars
($6,030,000.00) (the "Housing Authority Loan") for the development of a 269-unit multi-
family apartment community located on that certain real property located in the City of
Palm Desert, California (the "City") and known as Vitalia Apartments (the "Project").
As of August 26, 2021, the Authority has conditionally approved of the proposed Loan
commitment of the Housing Authority Loan to Six Million Thirty Thousand Dollars
($6,030,000), subject to the following:
1. Project. The Project will be operated for a period of fifty-five (55) years
following the date of completion of the Project and issuance of a certificate
of occupancy to provide affordable housing to persons and households of
low and very -low income in accordance with the affordability restrictions
contained in the Loan Agreement (as defined below) and in accordance with
the Tax Exempt Bonds and Low -Income Housing Tax Credit financing being
used by the Project. To the extent necessary, the Housing Authority shall
subordinate the deed of trust securing the Housing Authority Loan to the
liens and encumbrances of the Project's construction and permanent
lenders. The Housing Authority will not subordinate its interests in the
regulatory agreement referenced in Section 3 below, and the City will not
subordinate its interest in any regulatory agreement that is required to be
recorded against the Property by virtue of a density bonus granted pursuant
to Resolution No. 2021-57 of the City, to the liens or encumbrances of the
Project's construction and permanent lenders.
RESOLUTION NO. HA-104
2. Project Owner. The Project owner shall be a California limited partnership
whose administrative general partner is controlled by Pacific West
Communities, Ins., an Idaho corporation, or its affiliates.
3. Housing Authority Loan Documents. The proposed structuring of the
Housing Authority Loan will be evidenced by, among other things, a loan
and development agreement (the "Loan Agreement"), and a promissory
note, deed of trust and regulatory agreement, (collectively, the "Loan
Documents"), each in form and substance acceptable to the Housing
Authority and its counsel, and executed by the Project Owner and the
Housing Authority as applicable.
4. Housing Authority Loan Terms. The Housing Authority Loan shall have a
term of fifty-five (55) years, commencing as of the effective date of the Loan
Agreement and shall bear simple interest at three percent (3%) per annum.
The Housing Authority Loan shall be repaid from fifty -percent (50%) the
Project's residual receipts remaining after payment of fees (including
deferred developer fees, investor fees, partnership fees, and management
fees), debt service and operating expenses.
5. Affordability Restrictions.
(i) A total of 81 Units are to be restricted by Health and Safety Code
Sections 50106 and 50053 as Extremely -Low Income units:
a. 39 one -bedroom units
b. 21 two -bedroom units
c. 21 three -bedroom units
(ii) A total of 186 Units are to be restricted by Health and Safety Code
Sections 50079.5 and 50053 (assuming rent is calculated at 80% of
the Riverside County Area Median Income instead of 50% AMI) as
Low Income Units:
a. 92 one -bedroom units
b. 46 two -bedroom units
c. 47 three -bedroom units
(iii) Three 2-bedroom units will be unrestricted and used as onsite
manager units.
6. Construction and Permanent Lender Loan Documents,. The loan
documentation pertaining to the proposed construction and permanent
loans to finance the Project, and all related instruments, shall be submitted
to the Housing Authority for its approval and shall be in form and substance
acceptable to, and approved by, the Board of the Housing Authority and its
counsel.
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7. Award of Tax -Exempt Bonds from CDLAC . Prior to Loan closing and
funding, the Project shall have all of their funding sources committed. This
includes but is not limited to have been awarded the allocation of tax-
exempt bonds pursuant to an application therefor by Pacific West
Communities, Inc. to the California Debt Limit Allocation Committee
(CDLAC), California Tax Credit Allocation Committee for State Tax Credits
and any other funding source.
8. No Third Party Beneficiaries. This letter is solely for the benefit of the
Housing Authority and Pacific West Communities, Inc., and shall not inure
to the benefit of, or be relied upon by, any other person or entity other than
the Project Owner.
9. Counterparts. This letter may be executed in counterparts, with the same
effect as if each counterpart were an original document.
Very truly yours,
Palm Desert Housing Authority
By:
Name: L. Todd Hileman
Its: Executive Director
AGREED BY PACIFIC WEST COMMUNITIES, INC.:
By:
Caleb Roope,
President
Date: , 2021
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