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TO: REDEVELOPMENT AGENCY •' Aosta
FROM: Phil Batchelor `-"r'u
nty
Executive Director
DATE: April 21, 1998
SUBJECT: Loan Agreement - Senior Housing Project,North.Richmond Redevelopment Project Area
SPECIFIC REQUEST(S) OR RECOMMENDATIONS(S) & BACKGROUND AND JUSTIFICATION
RREECO VIMENDATION
APPROVE and AUTHORIZE the Deputy Director-Redevelopment to execute a Development Loan
Agreement with the Community Housing Development Corporation of North Richmond and Eden
Housing Inc. for the development of a commercial/retail project in the North Richmond Redevelopment
Project Area.
FISCAL ACT
None. No General Funds are involved. The total loan amount is $1,377,557, of which $427,557 has been
previously approved and allocated. The remaining $950,000 will provided by the County Affordable
Housing and Special Revenue Fund No. 1113000. This appropriation will be provided for in the Agency's
budget.
CONTINUED ON ATTACHMENT: YES SIGNATURE:
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_RECOMMENDATION OF EXECUTIVE DIRECTOR COMMS ATION OF A NCY
COMMITTEE
APPROVE OTHER Tj
SIGNATURE(S):
ACTION OF
AGENCY ON . - � APPROVED AS RECOMMENDED OTHER_
VOTE OF COMMISSIONERS
I HEREBY CERTIFY THAT THIS IS A
UNANIMOUS (ABSENT _) TRUE AND CORRECT COPY OF AN
AYES: NOES: ACTION TAKEN AND ENTERED ON THE
ABSENT: ABSTAIN: MINUTES OF THE REDEVELOPMENT
AGENCY ON THE DATE SHOWN.
Contact: Beth Lee
335-1256 ATTESTED {
cc: Community Development PHIL BATCHELOR,
Redevelopment Agency AGENCY SECRETARY
Auditor-Controller
via Redevelopment Agency
Eden Housing ,
CHDC BY a F ` t j� __) , DEPUTY
ii
CK['iRC71.JND/REASQN FOR REC MMENDATIONS
A major goal of the North Richmond Redevelopment Plan is to improve and expand the supply of economic and
employment related development in the Project Area. The North Richmond Commercial/Retail project is a crucial step
in achieving this goal and revitalizing the economic development potential of the community. The North Richmond
Municipal Advisory Council has been a strong supporter of, and has reviewed and voted to increase financial support
to, this project.
Community Housing Development Corporation (CHDC) of North Richmond and Eden Housing Inc. are nonprofit
housing development corporations interested in constructing quality affordable senior rental housing and a
commercial/retail center in the North Richmond Redevelopment Project Area. On September 13, 1994, the
Redevelopment Agency approved a Disposition, Development and Loan Agreement (DDLA)between the Agency and
the Community Housing Development Corporation of North Richmond and Eden Housing. The DDLA provides for
the block bounded by 2nd, 3rd, Grove and Chesley to be redeveloped into a 52 unit affordable senior housing
commercial/retail project. The DDLA requires the Agency to acquire the twenty-one (2 1)parcels, relocate tenants, and
prepare the land for development of the senior housing mixed-use project.
On December 6, 1994, the Redevelopment Agency approved a contract between the Agency and Contra Costa County
for real property services relative to property acquisition/relocation needs for the senior housing project. The properties
have been acquired for the project. All tenants have been relocated and the structureshave been abated.
The total project includes fifty-two(52) affordable senior housing units, up to 10,000 square feet of commercial/retail
space, and the Center for Health on the southeasterly portion of the site. The commercial/retail center is expected to
include office space for CHDC and the Service Integration Team, a sheriff's office co-located with an automatic teller
machine, and approximately 2,000 square feet of retail space. The Center for Health is currently under construction.
CHDC and Eden are leveraging the Redevelopment allocation with funds from a variety of sources. They have applied
for, and secured, a grant in the amount of$685,000 from the Office of Community Services (OCS). The County
Redevelopment Agency has previously allocated $427,557 to the project for site acquisition, relocation and demolition
costs. They have applied for funding from the Contra Costa County and the City of Richmond Community Development
Block Grant(CDBG)programs. They also plan to submit additional grant applications to other appropriate public and
private entities to cover the total remaining gap of$940,000.
The development team secured the OCS grant three years ago,which was two years in advance of receiving the housing
funds. Market studies performed for the area suggest that the commercial/retail center's success will depend in great part
on the ability to increase the population base in the community. Thus, the development;of the commercial/retail center
was delayed until the adjacent senior housing and Center for Health projects were being developed. As a result of the
commercial/retail project delay, the OCS grant funds must be used or returned by September 1998.
The North Richmond community and County Redevelopment Agency would like to secure the OCS funds for the
community and to develop a new commercial/retail center. Therefore, the Agency'will provide a loan of up to
$1,377,557 to cover previous commitments and the outstanding gap amount. The Agency does not have sufficient
financial resources of its own and the County has agreed to loan funds to the Agency from its Affordable Housing Trust
Funds. The Agency's loan amount will be reduced dollar-for-dollar by the amount of any additional leveraged funds.
The redevelopment funds will be structured as a residual receipts loan, secured by a promissory note and deed of trust
against the land and planned improvements. The Agency and development team will execute a Development Loan
Agreement for the commercial/retail project to specify the terms and conditions for the use of the redevelopment funds.
Staff analyses indicate that the potential benefits to the Project Area from the project are significant:
1. The construction of new commercial/retail center will assist the Agency in revitalizing the community;
2. CHDC and Eden will enter into an agreement to hire North Richmond residents for new jobs created
during construction; and
3. Tenants of the commercial/retail center will enter into an agreement to provide North Richmond residents
priority status for new employment opportunities.
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