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HomeMy WebLinkAbout02/01/2024 - Meeting Materials MEETING OF THE REDEVELOPMENT AGENCY FINANCE COMMITTEE Thursday, February 1, 2024 1:00 P.M. 451 S State Street Room 118 Salt Lake City, UT 84111 The Redevelopment Agency (RDA) Finance Committee meeting will be a hybrid meeting which enables people to join remotely or in-person to listen to the meeting. To access the electronic meeting please visit: https-//us02web.zoom.us/j/87093887988?pwd=Wmovdl VNbUhEQUVESVZGWEZpVmN4dz09 Agenda 1. Roll Call 2. Approval of the minutes A. Review and Approval of the November 15, 2023, Committee Minutes Members will review the November 15, 2023, meeting minutes and consider for approval. 3. Business A. High Opportunity Area Affordable Housing NOFA Members will receive a funding recommendation for the High Opportunity Area Affordable Housing Funds Notice of Funding Availability through the Housing Development Loan Program (HDLP) 4. Adjournment People with disabilities may make requests for reasonable accommodation no later than 48 hours in advance in order to attend this Redevelopment Agency Finance Committee. Accommodations may include alternate formats, interpreters, and other auxiliary aids. This is an accessible facility. For questions, requests, or additional information, please contact the RDA at 801-535-7240. MINUTES of the REDEVELOPMENT AGENCY FINANCE COMMITTEE Wednesday, November 15, 2023 2:00pm o Roll Call The following members were present: Danny Walz, RDA Peter Makowski, Economic Development Blake Thomas, Community and Neighborhoods Tony Milner, Housing Stability Marina Scott for Mary Beth Thompson, Finance Amy Rowland, Redevelopment Advisory Committee Baxter Reeser, Redevelopment Advisory Committee Also Present: Cara Lindsley, RDA Deputy Director;Austin Taylor, Project Manager;Allison Parks, Senior City Attorney; Sarah Montoya, Senior City Attorney,Ashley Ogden, Senior Project Manager; Felina Lazalde, RDA Office Facilitator; Dustin Buckthal, Rocky Ventures/The Front Climbing Gym. o Approval of the minutes of the September 21, 2022, and December 21,2022 meetings. Marina Scott made a motion to approve the minutes from the September 21, 2022 and December 21, 2022 meetings. Peter Makowski seconded the motion. Upon roll call, seven members approved with one abstained. o Business A. Funding Recommendation for a$2,000,000 loan to Rocky Ventures for expansion of The Front climbing gym located at 1470 South 400 West in the Redevelopment Agency's State Street Project Area. Austin Taylor presented a funding recommendation for a$2 million loan to Rocky Ventures; aiming to support the expansion of The Front climbing gym at 1470 South 400 West within the Redevelopment Agency's State Street Project Area. The loan is anticipated to be for a three-year term with a 20-year amortization through the RDA Loan Program. This loan will be used to finance Phases I, II, and III of the gym's four-phase expansion project. Over the course of these three phases,two existing buildings will be repurposed for an upgraded climbing gym. The project aligns with five out of the six public benefit criteria required for primary financing under the RDA Loan Program. It falls short only in the Sustainable Development Policy, as this facility type presents unique challenges. Despite this, the project incorporates energy-efficient design features, anticipating a 24% decrease in electricity consumption and a 21%decrease in overall utility costs compared to code baselines. The project acknowledges positive contributions to public amenities, adaptive reuse, permanent job creation, transit alternatives, and economic impact. Questions: • Will this loan be repaid using Operational Income at any point or is the sole purpose of the loan's three-year term meant to cover the construction of future phases? o Dustin explained that phases 1-III are slated for completion sometime around the summer of 2025.The three-year term is meant to provide temporary relief from high interest rates and a volatile financial climate. The plan is to refinance the loan in three years. • Was any sort of Debt coverage calculation done for this project? o A Debt Service Coverage Ratio Calculation was not done for this project because rent is not being collected. For owner occupied type projects we look more at the cashflow of the business and the amount of debt service from that. • Is there an explanation as to why a primary partner was not found in the credit and lending applications? o The SBA Loan that is issued for real estate is called a 504 Loan. With a 504 Loan 50% of the project is financed by the SBA and somewhere around 40% is financed by a bank. The bank takes a primary position,while the SBA takes a secondary position. Financing the project would require the existing buildings to be refinanced. Further analysis showed that refinancing existing buildings would increase the project size to$10 million. Lenders are not comfortable with financing a project of this scale now. • Was the most recently acquired building purchased with cash and when did the purchase take place? o It was seller financed and it was purchased in late 2021 or early 2022. • Did the former owner of the most recently acquired building vacate the property when it was purchased or was there a lease-back agreement? o The building was vacant for a couple years prior to purchase. It used to be a tradeshow booth making company. Unfortunately, it went out of business due to the various economic hardships brought on by the COVID pandemic. • In the documents, it says that construction has already started, is that correct?And is it Phase I? o Yes,to both. • What is the comfort level for starting construction without the confirmed financing of this loan? o Securing financing has never been an issue. This is a successful business with a consistent cashflow and equity. • The application mentions there is a non-profit donation match—Please provide more details on how this program works. Does this business have a 501(C)(3) non-profit arm? o No. In 2017 a program was created, and four nonprofits were selected.When members sign up, they are given the option to donate any desired amount of money to those specific organizations. The amount they donate is then matched. This program has successfully raised over$500K in donations since implementation. $150k is set to be raised in 2023 alone. • There was mention of a desire to increase diversity and scholarships. How much funding is allocated toward scholarships? Is there a sliding scale based on the income of an applicant? o The Youth program has been running a scholarship program for around six months. There is an after-school program where kids are selected to participate at no cost. So far 84 students have been able to participate.Additionally,there is a 6-month scholarship for climbing teams.There is also a scholarship program for adults with a$3000 monthly budget. This program is to be used in a"pay what you can" kind of way. New or existing members specify how much they can afford to pay for the 6-month membership. The $3000 monthly budget for adult scholarships can be used to cover the difference on those memberships. • Over the past couple of years,there has been a steady increase in income from memberships. Is this due to increased membership volume or increased membership prices? o It was a combination of both. Membership prices have increased year-over-year by 3%to 5%with a current count of 11,000 members. • It seems this business typically partners with regional or mid-sized banks with Wells Fargo being the only national banking partner on record. Is there a reason for this? o Regional banks are the only lenders we have been able to get previous financing from for construction projects. We have had a couple of small loans from Wells Fargo, but US Bank and Wells Fargo have denied all my projects because a climbing gym is a weird asset and national banks tend to be more conservative. Chair Walz explained that the Committee does not have the authority to waive policy. He clarified that a policy waiver would be an RDA Board decision. He elaborated that The Committee is not only being asked to approve the terms of the loan.They must also understand that as part of those terms,they would forward a positive recommendation for the Board to also waive those conditions as a function granting the loan. Approving the terms of the loan subsequently carries a positive recommendation to also approve the waivers. The Chair requested a motion. Peter Makowski made a motion to approve the terms of the loan in addition to the recommendation of a waiver to the policy exception.Amy Rowland seconded the motion. Upon roll call,the motion was passed unanimously. 3. Adjournment There being no further business the meeting was adjourned. Danny Walz, Chairperson This document along with the digital recording constitute the official minutes of the Redevelopment Agency Finance Committee held November 15,2023. 0 SLCRDA RDA FINANCE COMMITTEE MEMORANDUM NOTICE OF FUNDING AVAILABILITY (NOFA) FOR AFFORDABLE HOUSING: 2024 High Opportunity Area Affordable Housing Funds—Housing Development Loan Program Funding Recommendations Meeting Thursday, February 1, 2024: 1:00 PM—3:00 PM DATE: January 26, 2024 TO: RDA Finance Committee 1. Redevelopment Advisory Committee: Amy Rowland 2. Redevelopment Advisory Committee: Baxter Reecer 3. Economic Development: Peter Makowski 4. Finance: Mary Beth Thompson 5. Redevelopment Agency: Danny Walz 6. Community and Neighborhoods: Blake Thomas 7. Housing Stability: Tony Milner FROM: Tracy Tran, Senior Project Manager RE: Finance Committee—Funding Recommendations for the High Opportunity Area Affordable Housing Funds Notice of Funding Availability through the Housing Development Loan Program(HDLP). OVERVIEW: In 2017, the Redevelopment Agency of Salt Lake City ("RDA") Board of Directors ("Board")allocated$4.5 million to incentivize the development and preservation of affordable housing located within High Opportunity Areas,which are neighborhoods that provide access to resources that improve chances at upward economic mobility. In 2019,the RDA Board received and approved a$1.8 million loan application for these funds. The Board has directed staff to continue to solicit applications for projects within High Opportunity Areas on an ongoing basis until funds are expended. In late 2023, the High Opportunity Area map was updated to reflect newer data and metrics, which resulted in an expanded area that qualifies for these funds. $2.7 million remains in High Opportunity Area Funds ("HOAF")through the Housing Development Loan Program("HDLP"). Although the HOAF have not been advertised in a competitive manner like the RDA's annual competitive HDLP Notice of Funding Availability (NOFA), RDA staff received two applications on January 3, 2024,with total requests of$5.35 million for the remaining $2.7 million. Funds Availability $2.7 million is available for affordable housing developments which meet the Threshold Requirements of the HDLP program. All HDLP loans will be available to selected projects for acquisition, construction and/or development uses. The RDA recognizes that the construction sources and uses for projects may not be the same as the permanent sources and uses and that the amount of debt the HDLP loans are subordinated to may vary depending on the status of the projects. 0 SLCRDA Guiding Policy The HOAF are being administered pursuant to the Housing Allocation Funds Policy("Funds Policy"), resolution R-1-2022,and the Housing Development Loan Program Policy("HDLP Policy"),resolution R-2-2022, which replaced the Affordable Housing Notice of Funding Availability Policy, resolution R-17-2018. The Funds Policy establishes policies for allocating and directing resources for the development and preservation of housing by various funding sources. Highlights of the Funds Policy include: • Housing Funds: The Policy establishes four housing funds based on fund source.The revenues, expenditures, interest, and payments for each fund source shall be separately accounted for to ensure the RDA control and oversight to comply with statutory requirements. • Annual Budgeting Process: The policy provides that on an annual basis,the RDA shall present for the Board's consideration a Housing Development Funding Strategy that projects revenues for the upcoming fiscal year and proposes funding priorities and allocations. This will allow the RDA to be flexible to address current needs, leverage current opportunities, coordinate with other city resources, and allow funding priorities to align with evolving plans and policies. The HDLP provides low-cost financial assistance to incentivize the development and preservation of affordable housing within Salt Lake City municipal boundaries. The HDLP Policy provides a centralized application, underwriting, and approval process regardless of the fund source and also features: • Funding allocations and priorities determined on an annual basis. The funding priorities for these funds were based on the FY2023-24 Annual Housing Funding Priorities. • The transparent administration of funds through a Notice of Funding Availability (NOFA) process. Revenue from various funds may be combined into a consolidated NOFA or a NOFA may be issued for a specific funding source. NOFAs could be offered on an annual basis or multiple times per year and can be competitive or open-ended depending on availability of funds,priorities, and demand. • A standardized process for approving applications and a uniform set of underwriting policies. In April 2023, the Board adopted the FY2023-2024 Annual Housing Funding Priorities. These priorities included Threshold Requirements for the Housing Development Loan Program, which include: • Deeply Affordable Housing: o Policy Objective: Expand the availability of units for extremely low-income households, thereby providing housing options for individuals or families that are homeless or at risk of homelessness. o HDLP Implementation: All projects must include either family-sized units and/or deeply affordable units. To meet the RDA's deeply affordable threshold, at least 10% of the total residential units shall be income and rent restricted to households earning 40% of the area median income ("AMI") and below as established by the U.S. Department of Housing and Urban Development ("HUD"). These units will be rent and income deed restricted. • Family Housing: o Policy Objective: Provide opportunities for families to enjoy the many benefits of urban living by encouraging the development of housing that is more conducive to 2 0 SLCRDA larger household sizes. o HDLP Implementation: All projects must include either family-sized units and/or deeply affordable units. For a development to qualify for these funds, a minimum of 10%of the total residential units shall have three or more bedrooms and shall be income and rent restricted to those earning 60%AMI and below,with AMI limits as established by HUD. Review and Approval Process Pursuant to the Policy, the RDA Finance Committee ("Committee") is charged with reviewing submitted applications and providing a funding recommendation that will be forwarded to the RDA Board of Directors ("Board"). The Board will make the final determination of funding allocations, after which the RDA will issue a conditional commitment letter to those applications that are selected for funding. The conditional commitment letter between the RDA and the applicant will contain the covenants,terms,and conditions upon which the RDA will provide financial assistance to the proposed project once financial, legal,regulatory, and design approvals are obtained. Summary of Applications Below is an overview the submitted applications: Project Developer Funding Address Request 515 Tower-Conversion Perpetual Housing $2,650,000 515 East 100 South Salt Phase I Fund of Utah Lake City, UT 84102 Fairmont Heights II Lincoln Avenue $2 700 000 2257 South 1100 East Capital Salt Lake City,UT 84106 TOTAL FUNDING REQUEST: $5,350,000 AVAILABLE FUNDING: $2,700,000 *This project also applied for funding through the competitive HDLP. They are seeking a total of$2,650,000 between the two applications.If they receive the full amount in this process, they will not need the amount within the competitive HDLP. **This project also applied for funding through the competitive HDLP. They are seeking a total of$5,900,000 between the two applications. Please refer to Attachment A: Applications Overview for a summary of both applications and Attachment B:Project Summary Sheets for an overview of salient information for each application. Standards of Review As per the HOAF Guidelines and Application Handbook, applications that meet all the Threshold Requirements will be evaluated based on the following: I. Alignment with project priorities 11. Content and quality of the project narrative III. Qualifications and experience of the applicant and development team IV. Content, effectiveness, and appropriateness of the budget, sources and uses, operating proforma, and related assumptions V. The readiness of the project to proceed to construction VI. Any and all content regarding building and site design 3 0 SLCRDA Once applications have been reviewed and recommended by the Committee,they will be forwarded to the RDA Board of Directors for their approval. ATTACHMENTS: A. Applications Overview B. Project Summary Sheets C. Project Priorities and Interest Rate Reductions 4 ATTACHMENT A: APPLICATIONS OVERVIEW Project 515 Tower-Conversion Phase I Fairmont Heights 11 Developer Perpetual Housing Fund Lincoln Avenue Capital TOTAL Address 515 E 100 S 2257 S 1100 E RDA Loan Request RDA Request $ 2,650,000 $ 2,700,000 $ 5,350,000 Total Project Cost $ 39,231,648 $ 34,009,242 RDA Loan to Cost 6.8% 7.9% 7.3%Average Acquisition Loan Interest Rate(w/project priority deductions) n/a 1.0% 1.0%Average Term n/a 2 Amortization n/a TBD Repayment Type n/a Balloon or conversion to permanent loan onstruction Interest Rate(w/project priority deductions) 2.0% 1.0% Term 15 16 Amortization 15 40 Repayment Type Cash Flow Hard Financial Metrics Deferred Developer Fee% 22% 40% 31%Average Tax Credits Yes,9%reserved Yes,9%,applying for 2025 Cost per Unit $ 408,663 $ 618,350 $ 513,506 Average Cost per SF $ 458 $ 1,085 $ 771 Average Threshold Requirements Family-Sized Affordable or Deeply Affordable Units Both Deeply Affordable Energy Star Score 90+ Cond.of Approval Cond.of Approval 100%Electric Cond.of Approval Cond.of Approval Housing Unit Details 40%AMI and Below Studio 15 15 1bd 2 18 20 2bd 9 9 3bd 2 2 4bd 1 1 Total 40%AMI&Below Studio 25 25 1bd 6 15 21 2bd 4 4 3bd 30 30 4bd 15 15 Total 41%-60%AMI Studio 1bd 7 7 2bd 2 2 3bd 4bd Total 61%-80%AMI-V ial Una Studio 40 40 lbd 8 40 48 2bd 15 15 3bd 32 32 4bd 16 16 otal of the Total Residential Units Priorities&Interest Rate Reductions Priorities: The four Funding Priorities determined by the FY2023-2024 Annual Housing Funding Priorities include:Family Housing,Target Populations,Homeownership,and Missing Middle/Unique Housing Type.These receive a weighted ranking of 3 points each as compared to other priorities which receive I ranking point Interest Rate Reductions:Projects receive a 0.5%interest rate reduction for each included prionty.Sustainability allows for a 1%or 2%reduction.The maximum reduction per development application is 2%. Family Housing 3 Target Populations 3 3 Transportation Opportunities 1 1 Expand Opportunity 1 1 Architecture and Urban Design 1 Commercial Vitality 1 Historic Preservation/Adaptive Reuse 1 NOFA Ranking Weight Total 10 6 8 Average 5 0 SLCRDA ATTACHMENT B: PROJECT SUMMARY SHEETS 6 HOUSING DEVELOPMENT PROJECT NAME: 515 Tower- Conversion Phase I LOAN PROGRAM ADDRESS: 515E 100 S OVERVIEW HOUSING UNITS 0_ 11[Adaptive rpetual Housing Fund of Utah : -• ••C •LP Loan Studio 40 - 25 15 Reuse 1 Bed 8 - 6 2 derutilized 2 Bed - - - - 3 Bed 32 - 30 2 RDA FUNDING REQUEST 4 Bed 16 - 15 1 is _• ' - • $2,650,000 Total 96 - 76 20 161F.1190149 $39,231,648 ff.TiTIMMM RM 1 6.75% CONSTRUCTION DEBT AHEAD OF RDA PROPOSED TERMS Senior Debt $16,960,000 2% W 15 Yr PERMANENT SOURCES 911i•. Cash Flow 72.6% • Subordinate to permanent Senior Debt $6,508,95816.7% debt RDA Loan $2,650,0006.8% OLWHLF $1,000,000 HDLP THRESHOLDS AND PRIORITIES Utility Rebates $76,800 0.2% • Family-Sized Units and LIHTC Equity $27,696,083 71% • Deeply Affordable Units SLCO ARPA Grant $598,584 1.5% • • • Deferred Feel $500,000 1.3% • Yes Total $39,030,425 100% �'. Yes ' Family Housing, Target USES Populations, Expand Opportunity, Historic Land $16,000,000 41.0% Preservation/Adaptive Hard Costs $15,466,320 39.6% Reuse, Transportation Soft Costs $1,097,907 2.8% Opportunities, Commercial Developer Fee $2,249,922 5.8% Vitality Financing Expense $1,921,418 4.9% TIMELINE Contingency $1,686,134 4.3% Reserves $608,724 1.6% • May 1, 2024 Total $39,030,425 100% • •, • - December 31, 2024 LOW-INCOME HOUSING TAX CREDIT • • 1 . 1 Yes • -• Yes, 9%, 2023 1 The Developer is committing an additional$625,000 of developer fee from the project to create an equity line of credit so that residents can access their equity prior to a refinance or sale event,for a total of$1,125,000 deferred developer fee. 7 HOUSING DEVELOPMENT PROJECT NAME: 515 Tower- Conversion Phase I LOAN PROGRAM ADDRESS: 515 E 100 S RDA APPLICATION NOTES The RDA, through the City's American Rescue Act Plan (ARPA) funds, allocated $10,000,000 to the Perpetual Housing Fund of Utah, LLC to purchase this property for an affordable housing development with a tenant wealth building program. This$10,000,000 was used for the purchase of the property that would then allow PHF to develop additional projects that carry out their goals to provide 1,000 affordable homes that will help families and individuals build wealth. This is a unique model in which the developer will be contributing their own profits, which they will share with the tenants of the building. This development also applied for funding through the competitive HDLP, which will be in front of the RDA Finance Committee at a future date. The 515 Tower needs a total of $2,650,000 and if the full amount is received through this round of high opportunity area funding, they will not need to request funds through the competitive HDLP process. PROJECT SUMMARY From Developer: 515 Conversion Phase I a mixed-income, sustainable, adaptive-reuse project located on the East side of Salt Lake City. The project is part of multi-phase, mixed-use project on the site and will be a beacon of affordable housing in the rapidly unattainable east side of Salt Lake City. The overall project is planned to include a mixed-income daycare, local retailers, and impact-focused commercial and co-working space. This project is being developed by Perpetual Housing Fund and all 96 units in this phase will feature a shared-equity model - sharing 75%of the phase's profits and appreciation with the residents living here. 515 will incorporate an array of amenities that will benefit the lives of its residents including a fitness center, a clubhouse, a Greenbike station on site (with annual passes included at no charge), indoor bike storage, a bike-repair station, and shared outdoor space. Located within walking distance of the project is an elementary school, a core bus route, and a public park. The project will also be fully electric, contributing to better air-quality in the area and improving the health and wellbeing of its tenants. The units will also be built within the criteria for Enterprise Green Communities 2020. DEVELOPER SUMMARY The project is being developed by Perpetual Housing Fund with Giv Communities as a development consultant. The team has successfully developed or consulted on over a thousand affordable housing units utilizing the Low- Income Housing Tax Credit, OWHLF, and SLC loan programs along the Wasatch Front. Recent affordable housing projects by the development team include: Exchange - Salt Lake City Project Open Phases 1 and 2 -Salt Lake City Citizens West Phase I -Salt Lake City Denver Street Apartments-Salt Lake City Pamela's Place-Salt Lake City Imagine Jefferson -Ogden Startup Crossing- Provo Harris Village Shelter and Permanent Supportive Housing-Tooele 8 HOUSING DEVELOPMENT PROJECT NAME: 515 Tower- Conversion Phase I LOAN PROGRAM ADDRESS: 515E 100 S SITE MAP � r PROJECT RENDERINGS . ;•�-� _ �`- L4� s_'��`f - —ter� `; — �0 �0 9 HOUSING DEVELOPMENT PROJECT NAME: 515 Tower- Conversion Phase I LOAN PROGRAM ADDRESS: 515E 100 S 515 Tower -0-01 Impact Office and Phase 2 Rsiden hiline Addition afw��17=71_61 PHF rol \Nq\\11� _ \ Conversion 96 units Future law ChildcareMixed-income PBF Phase 2 12 Units Playground (Floor 3) impact Food,Office, and Building Amer (Floors 1-2) �--III-I I.II I■II■'� 10 HOUSING DEVELOPMENT PROJECT NAME: Fairmont Heights II LOAN PROGRAM ADDRESS: 2257 S 1100 E OVERVIEW LOW-INCOME HOUSING TAX CREDIT - - • •- Lincoln Avenue Capital and Applying for Tax Credits Yes, 9% Housing Authority of Salt Lake City No ' - •- HDLP Loan ' - •- New Construction ACQUISITION SOURCES • OfficeTotal RDA-HDLP $3,200,000 45.1% RDA FUNDING REQUEST Competitive is _• ' -• - $2,700,000 RDA High Opp Funds $2,700,000 38.1% • ' • - $34,009,242 HASLC Cash $800,000 11.3% ff TEPEUMM RM 1 7.9% LAC Cash $390,000 5.5% Total $7,090,000 100% PROPOSED TERMS 2.81% 1% ACQUISITION USES • 16 Yr, 40 Yr . of • •. Cash Flow Acquisition $7,000,000 98.7% • Subordinate to permanent Insurance 1 $40,000 1 0.6% 1 debt Closing Costs 1 $50,000 1 0.7% 1 Total 1 $7,090,000 1 100% HDLP THRESHOLDS AND PRIORITIES • Family-Sized Units and CONSTRUCTION DEBT AHEAD OF RDA • Deeply Affordable Units • • • • Senior Debt $21,767,665 • Yes �'. Yes PERMANENT SOURCES ' Target Populations, Expand Opportunity, Senior Debt $3,790,000 11.1% Transportation RDA Loan $2,700,000 7.9% Opportunities, Architecture Utility Rebates $142,500 .42% and Urban Design LIHTC Equity $26,147,384 76.9% TIMELINE Deferred Fee $1,229,257 3.6% GP Capital $100 0.0% • IIIIINI May 1, 2024 Contribution go• - December 31, 2024 Total $34,009,242 100% HOUSING UNITS PERMANENT USES Bedroom 0 Total Market .0• 0• Use Amount • st Count Units Rate AMI AMI Land $3,500,000 10.3% Studs 40 - - - Hard Costs $23,702,904 69.7% 1 Bed Soft Costs $898,000 2.6% 2 Bed 15 2 4 9 Tax Credit Fees $308,375 .9% 3 Bed - - - - Developer Fee $3,091,512 9.1% 4 Bed - - - - Financing Expense $2,146,018 6.3% Total 55 9 19 27 & Reserves Escrow& Reserves $362,432 1.1% Total $34,009,242 100% 11 HOUSING DEVELOPMENT PROJECT NAME: Fairmont Heights II LOAN PROGRAM ADDRESS: 2257 S 1100 E RDA APPLICATION NOTES This project also applied for$3,200,000 for their Fairmont Heights I project through the competitive HDLP process. Both phases of the project will be located on the same parcel with Phase 1 being built first and Phase 2 to follow. The developer is seeking an acquisition to permanent financing loan, which means initial funds would be used to buy the property, but the developer would need to obtain tax credits, financing, and building approvals within 2 years. If successful, they would be able to convert their acquisition loan to a longer-term permanent financing loan. If they are not successful, they will be required to pay back the loan at the end of the acquisition loan term. This project is seeking funding from both sources of funds. PROJECT SUMMARY From Developer. This is Phase 11 of a two (2) phase project. Phase 11 is 55 units with 40 1 bed/1 bath units at 710 sf/unit, and 15 2 bed/2 bath units at 1038 sf/unit, with an emphasis on deeply affordable senior housing. The structure will be a 7-story midrise building comprised of a 2-story parking deck and a 5-story wooden structure containing the housing. The site is located near the Fairmont stop on the TRAX S-Line. 5 units will be set aside for the chronically homeless, 5 units for mobility impaired individuals, and 9 units for the disabled. The site presents an incredible opportunity to tie into the neighborhood fabric and locate housing near transit, employment, recreation, and services. Both phases are designed to mirror the surrounding neighborhood. The project transitions into the neighborhood using elements in both the contemporary form of the building and the materials that clad its skin. The space on the ground floor along Simpson Avenue and 1100 S will activate the building to the public and bring the design into the neighborhood. The pedestrian nature of the activities within and the rhythm of the living units help the project feel comfortable. DEVELOPER SUMMARY From Developer: Lincoln Avenue Communities was founded with the mission to expand access to high-quality, affordable homes for families, individuals, and seniors. This work is more important than ever amid historic inflation and a nationwide housing affordability crisis that have weighed heavily on communities across the country. These complex challenges have inspired us to continue developing innovative housing solutions that embody the bold and creative spirit of our growing company. Over the past year, we've reaffirmed our commitment to preserve and create thousands of affordable housing units, and we are excited to have recently broken ground on several ground-up developments, adding much-needed units to communities across the country. Today, we're proud that more than 50,000 residents at 119 properties across 22 states call an LAC community their home. We've maintained a resident-first approach across our portfolio, connecting families, individuals, and seniors with local organizations, health resources, and opportunities to further their educational and career goals. 12 HOUSING 1EVELOPMENT PROJECT LOAN PROGRAM ADDRESS: 2257 S 00 SITE MAP SimpsonFAve ��\� PROJECT RENDERINGS 13 r„ \T., LINCOLN AVENUE CAPITAL r :.:III ..■ �� ■■�` -' Hann III a : � 1�� 1'.1K 111 111 ""'"' PERSPECTIVE -- FAIRMtoo, HEIG SALTIAY-UTAH `2024 ENCOMPASS'EmilIANUARV 3RD.2026 HOUSING DEVELOPMENT PROJECT NAME: Fairmont Heights II LOAN PROGRAM ADDRESS: 2257 S 1100 E --�-r—, malls 4 imam - - Is ■■ ■ r 4% 14 - SLCRDA ATTACHMENT C: PROJECT PRIORITIES AND INTEREST RATE REDUCTIONS Project priority criteria will be utilized to evaluate applications as well as provide for interest rate reductions. NOFA • RANKIN INTEREST CATEGORYPOLICY OBJECTIVE BENCHMARK G RATE REDUCTIONA WEIGHT Provide opportunities for families to enjoy Project provides at least the many benefits of 15%*** of the total units as urban living by 3+ bedroom units AND 1 Family Housing encouraging the includes family-oriented 3 X development of community amenities, as housing that is more approved by RDA Staff. conducive to larger household sizes Expand the availability of units for extremely Project sets aside at least low-income households 15%*** of the units for and special extremely low-income 2 Target populations, thereby households (40% AMI or 3 X Populations providing housing less) and/or special options for individuals populations in partnership or families that are with a governmental or homeless or at risk of nonprofit entity homelessness Create opportunities for those who have historically rented in Project is a for-sale product 3 Homeownershi the community to that will be sold to income 3 X p build wealth and qualified individuals/families establish permanent roots through homeownership Projects are either a missing Promote an array of middle housing type (i.e. scale of project types townhomes, courtyard Missing Middle to diversify the City's apartments, small-scale 4 & Unique housing stock/forms apartments) or a housing 3 X Housing Types and provide more type that is not commonly affordable living built: tiny homes, modular options for residents homes, pre-fab homes, accessory dwelling units - (ADUs) Achieve green building Projects must be built to Off- and energy Site Net Zero or On-Site Net conservation standards Zero standard as described 5 Sustainability to lower housing in the RDA's Sustainable 1 X**** expenses, conserve Development Policy resources, and promote resiliency Resolution. 15 - SLCRDA Projects must meet two of the following: • Includes a car sharing, bike sharing, or transit pass program that is widely available to employees/ residents • Includes a commercial Promote a multimodal Project that includes transportation network employee shower, locker, Transportation and ensure convenient and bicycle facilities 6 Opportunities and equitable access • Is located within 1/3 mile 1 X to a variety of walking distance of a TRAX transportation options station or S-Line station • Implements reduced parking strategies without negatively impacting the neighborhood • Incorporates majority of parking within a primary structure to minimize the need for a surface parking lot Projects are located within an active RDA project area, Utilize the refer to Attachment B: RDA Project Area Map and development of h incorporate documented housing to reduce the Crime Prevention through Neighborhood number of vacant and � Safety distressed buildings Environmental Design 1 X and lots to reduce (OPTED) principles. RDA crime and return land staff shall provide final to a productive use review and approval. RDA staff may require Developer to provide approval from a certified professional. Projects are located within a High Opportunity Area, Provide for which is defined as an area Neighborhoods of that provides conditions that Opportunity by expand a person's likelihood Expand for social mobility as 8 Opportunity promoting the identified through an 1 X economic diversity of analysis of quality-of-life the housing stock indicators. Refer to within neighborhoods Attachment A: High Opportunity Area Map and - Table Encourage housing Buildings shall include an Architecture & that is high-quality, active ground floor use, 9 Urban Design enduring, and that significant ground floor 1 X contributes to glass, durable building neighborhood context materials and engaging 16 0 ���U��� ���U��� ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- and |ivabi|itythvou8h building entrances as architectural and determined by RDA staff urban design best practices Foster a mix ofland Projects are mixed-use and uses and unique establish commercial spaces neighborhood business within the development that Commercial am lacking and desired l0 districts that . l X Vitu|ity adequately meet the These spaces shall baopen local community's to the public and shall not needs bo spaces that are exclusive to the development Project acknowledges a Encourage the neighborhood's history and Historio preservation and/or maintain its unique character II Preservation reuse of buildings to through preservation, I X /Adeptive Reuse preserve the character rehabi|itution, orrepurpoainQ of neighborhoods of historic orunderutilized structures Promote cultural Project contributes ut least expression and add to l 5�� of the RDA the experience and � contribution towards the value ofthe built I2 Public Artinste||ation of art onaite or I X environment through towards the RDA art fund as art that is publicly outlined in the RDA Art visible or accessible Policy for all toexperience *Note:NOFA Ranking Welght:Uses anumber(the welght)between J and 3to assess the importance of the funding priority, with J being of lower importance and 3 being of the highest importance. "Note: 0.5% Interest Rate Reductions. While 22 Interest rate reductions are available, Interest rates can be reduced by maximum��0%. Please see Attachment 8for applicable standard loan terms and conditions. `Note: Between the two threshold requirements laid out in Section 3.7, ifm project includes both family housing units and deeply affordable units in accordance with this section, the project may receive the interest rate reduction by meeting the second threshold requirement afa percentage ufJ0%instead uf25%. ""Note: Sustainability Interest Rate Reduction:As per the RDA's Sustainable Development Policy, projects built to an Off- Site Net Zero standard are ellglble for a2%interest rate reduction and projects built to an On'SiteNet Zero standard are eligible for u2%interest rate reduction.