AgdaPkt 2005-01-24 - Laserfiche WebLink

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~.A-22 V. CONSIDERATION RECEIVED AND REASONS THEREFOR Under the tenus of the Agreement, the Developer will acquire the Property from the Agency with a Land Grant of$1.35 million and develop the project with an Agency-funded Development Loan of$2.63 million, and a water facility "Subsidy Fee" loan of up to $533,000. The project is anticipated to generate sufficient net cash flow to repay the Agency's loans. The project's economics are not strong enough to support a purchase price for the land, as discussed in Section IV. of this report. This is due to the affordability restrictions to be placed on the property, which greatly reduce the income-generating capability and value of the project. Consequently, the Agency will not be receiving any consideration for the land, which is consistent with the property's fair reuse value of$O. It is anticipated, however, that the Agency will receive full repayment of its Development Loan and Subsidy Fee Loan. The tenus of these loans and the payments to be received by the Agency are also consistent with the fair reuse valuation prepared for the property and transaction. VI. PROVISION OF VERY LOW-, LOW-, AND MODERATE-INCOME HOUSING This Project will provide fifty-eight (58) rental units affordable to fifty-seven (57) very low- income households earning between 20% to 50% of AMI and one (1) moderate-income manager household earning between 80% to 120% AMI. All the units will carry 55-year deed restrictions to maintain affordability. VII. CONFORMANCE WITH FIVE-YEAR IMPLEMENTATION PLAN The subject project is a key element of the Agency's affordable housing program, as described in the Agency's Implementation Plan for the 2005-2009 period. The project accomplishes a number of objectives, as follows: . By providing 57 very-low income and one moderate-income rental units, the Project will significantly increase the City's supply of deed-restricted affordable housing; . The project will enable the Agency to continue to meet its legal affordable housing production requirements; . With 98% of the units restricted to very low income households, the project is consistent Association of Bay Area Government's affordability targets for Redwood City, which state that at least 37% of the City's total housing need is for very-low income units. 1861 0.001 \028-004.doc: 1/2:)/2005 Keyser Marston Associates. Inc. Page 11