1. City Council Concord Senior Housing 275 E. Cordova Street
James Wong, Senior Project Manager
December 17, 2018

2. Recommendation
Find that the project is categorically exempt under Class 1 (Existing Facilities) of CEQA
Approve key business terms of Disposition, Development and Loan Agreement as described in agenda report

3. Concord Senior Housing

4. Background
The Concord is a low income senior apartment complex built in 1966 on City-owned land
Rent-subsidized under HUD Section 8 program
In 1986, developer Retirement Housing Foundation purchased the Concord from the original owner
In 1989, City purchased fee title to the land to preserve long-term affordability and entered into a 42-year ground lease with RHF as tenant
FPRS owns a 93% beneficial interest in the Concord, the City 7%

5. Background
In May 2015, RHF initiated negotiations on the financial restructuring and renovation of the Concord
Financial consultant services provided by David Rosen & Associates under City contract
The 52-year old apartment complex is in need of substantial rehab to extend the building’s useful life
Last major renovation in fire sprinkler system

6. Background
City to sell to RHF the Concord property, less the Surface Parking Lot (to be held by City for future disposition)
The sale would be subject to City approval of a parcel map application that is currently being processed
FPRS/City to receive an estimated $22.27M cash sale proceeds in 3 installments over next 4 years
The transaction would financially restructure and substantially renovate the Concord, and preserve this source of affordable housing for seniors.

7. Key Business Terms of DDLA
RHF to secure 4% tax credits and tax-exempt bond financing from the state, and Section 8 project-based rent subsidy from HUD.
City to sell Concord property (less surface parking lot) to RHF, at current estimated sale price of $44.28M
HUD $1.1M loan to be repaid in full
RHF to pay to FPRS/City an estimated $22.27M cash sale proceeds in 3 installments over next 4 years

8. Key Business Terms of DDLA
City to provide a carryback Seller Loan in the estimated amount of $20.91M.
Seller Loan: secured by recorded trust deed; 55-year term; 2.5% simple; fixed rate interest; converts to permanent financing upon completion, repaid through annual residual receipts (93% to FPRS)
Scope of work includes substantial renovation of dwelling units, mechanical/building systems, common areas, building exterior, landscaping, and parking.
Affordable housing restrictions per 55-year covenant
RHF compliance w/ all city policies including First Source Hiring, Minimum Wage Ordinance

9. Concord Senior Housing
Existing
Parking

10. Parcel Split
Existing
Parking
Relocated Parking

12. Schedule – Key Milestones
Feb 2019 – RHF submits Rent Application to HUD
July 2019 – RHF applies for tax credits and bond financing
Dec 2019 – Project Closing. City sells Concord to RHF. RHF pays 1st installment of sale proceeds to FPRS/City. Renovation commences.
Sept 2021 – Renovation completion
March 2022 – Permanent loan conversion. RHF pays 2nd installment of sale proceeds to FPRS/City.
March 2023 – RHF files first-year tax return and pays 3rd (final) installment of sale proceeds to FPRS/City