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HomeMy WebLinkAboutItem 8.1 SB343 Willows Housing Agmt Lt3D-30 58 343 Senate Bill 343 mandates supplemental materials that have been received by the City Clerk's office that relate to an agenda item after the agenda packets have been distributed to the City Council be available to the public. This document is also available in the City Clerk's office, the Dublin Library, and the City's Website. The attached document was received in the City Clerk's office after distribution of the May 6, 2008 City Council meeting agenda packet. G:\CC-MTGS\FORMS\SB 343 Form.doc f.t;- "3;-0 s <3. J J11~ BRADDOCK & LOGAN SERVICES. INC BUILDERS - DEVELOPERS ESTABLISHED 1947 P O. BOX 5300 DANVILLE. CALIFORNIA 94526-1076 TELEPHONE (925) 736-4000 FACSIMILE 1LJ25) 648-5700 June 3,2008 J eri Ram Community Development Director City of Dublin 100 Civic Plaza Dublin, CA 94568 Re: Amendment to Willows Affordable Agreement Dear Jeri: Attached is a summary provided by Bob Miller whom is our Legal Counsel with Braddock & Logan and handled the affordable transactions. This summary provides the infonnation regarding our experience with the Willows Affordable Units and specifically the transaction on Lot 3. We have been successful in selling all of the affordable units but one, Lot 33. As such, Braddock and Logan would like to pay the In Lieu Fee on the one remaining unit and convert it to market rate. Sincerely, oJ) ,{~~dl'-- J efha~Qnce Vice President lUn Attachment MEMORANDUM TO: FROM: RE: DATE: JEFF LAWRENCE ROBERT MILLER STATUS OF AFFORDABLE UNITS AT WILLOWS IN DUBLIN June 3, 2008 As of January I, 2008, there were three remaining affordable units left at the Willows Project, in Dublin, CA: Lot 3, a 3 bedroom moderate unit; Lot 32, a 4 bedroom moderate unit; and Lot 33, a 4 bedroom very low income unit. These units had been completed for many months at that point and almost all of the other units had been sold. The status of the sale of these three units as of the date of this memo is described below. Braddock & Logan advertised several times in the local paper, cooperated with the Tri- Valley Housing Opportunity Center to attract potential buyers, participated in the City website and hosted a public meeting at City Hall, which was also advertised extensively in the area paper. Despite all ofthose efforts, we were only able to attract three qualified buyers for the affordable units. Only one person attended the public meeting. Most potential applicants who did apply did not qualify because they did not have the required number of persons, the required income levels, the required credit scores, or otherwise were ineligible. Lot 3 Lot 3 was sold to a moderate buyer. Escrow closed on May 30, 2008. The buyer who purchased the property participated in the City of Dublin down payment assistance program, without which they would not have had adequate downpayment funds to purchase the home. This buyer had substantial difficulty qualifying for the City assistance program because of issues with their residency, which the City ultimately resolved. I have been informed that.the City has exhausted all of the funds it had for downpayment assistance. Lot 32 Lot 32 was sold to a moderate buyer at a substantial discount to the maximum purchase price permitted. This buyer obtained financing through the FHA, which required that Braddock & Logan obtain FHA approval for the project. This delayed the closing by approximately 8 weeks. At the end of that time, the lender increased the minimum downpayment required of the buyer from 5% to I 0%, jeopardizing this sale. The buyer ultimately arranged a gift from a family member of the additional funds required. The buyer has now locked on the loan so no further changes in the loan are anticipated. We expect the buyer to close by the end of this month. Lot 33 Lot 33 was sold to a very low buyer who was eligible for Section 8 Federal housing assistance payments. Braddock & Logan successfully lobbied the City to agree that this buyer's Section 8 funds should not count towards the income limitations of a very low buyer. Without this Section 8 funding, it would have been impossible for this buyer to qualify. After the buyer signed the purchase agreement and qualified for a loan, the buyer's credit score deteriorated to the point where she could no longer qualify for a loan. The buyer then terminated the purchase agreement for Lot 33. Since that time, underwriting standards have further tightened, making it even more difficult for a comparable buyer to qualify for a commercially available loan. We have not received any qualified applicants for the very low unit since that buyer cancelled. We are unable to locate any qualified persons to sell Lot 33 to under the affordable requirements for the project. 06/03/2008 14:26 FAX 9256485702 BraddocK&Logan I4J 002/004 A.M.ltNDMENT NO.2 TO AFFORDABLE HOUSING AGREEMENT FOR THE CONSTRUCTION OF INCLUSIONARY UNITS PA 02..063, Braddock & Logan, Group ill, L.P., a California Limited Partnership San Ramon Village Plaza - TIDS SECOND AMENDMENT ("the Second Amendment") is entered into this 3rd day of JWle, 2008 by and between the City of Dublin ("the City") and BraddOCk & Logan, Group III, L.P., a California Limited Partnership ("the Developer"). The City and the Developer are referred to collectively as the Parties. RECITALS 1. The City and the Developer are parties to that certain Affordable Housing Agreement for the Construction ofInclusionary Units, dated July 18,2005 (''the Agreement"), where41 developer agreed to consttuct 7 inclusionary units pursuant to the requirements of Chapter 8.68 of the Dublin Municipal Code, the Inclusiona!)' Zoning Regulations ("the Regulations"). 2. The Agreement specified the location of those 7 inclusionary units and the phases of the Project within which the inclusionary units Inust be completed. 3. ay ail. amendment dated October 3, 2006 (..the First Amendment"), the parties amended the Agreement to alter the location of 5 of the inclusionary units and consequently the phasing of the construction of the units. 4. Developer has now constructed all oftbe 7 inclusionary units it promised to construct, and it has sold 6 of the 7 inclusionary Units; but, despite its diligent efforts, Developer has been unable to sell the remaining inclusionary unit. . 5. . The minirtlUtn requirements of the City's Inc1usionary Zoning Ordinance would have required the Developer to construct 4 of the 7 inclusionary units and pay fees in lieu of constructing 3 of the 7 inclusiontiry units necessary to satisfy its obligations under the Regulations. . 6. Given Developer's diligent efforts to sell the one remaining inclusionary unit and the f~t that Developer could have, in the first instance, paid inclusionary fees to satisfy the remaining one-unit obligation, the City is wiiling to agree to an amendment to the Agreement that permits developer to satisfy the remaining obligation by paying a fee in lieu of construction for ~e remaining 1 unit. NOW, THEREFORE, Developer and City for themselves and their respective ~uccessors and assigns hereby agree as follows: A. Paymf:nt of Fees In Lieu of Construction to Satisfy Remaining Obligations. Notwithstanding anything to the contrary in the Agreement or the Fitst Amendment, the parties 1 Amendment No.2 Affordable Houring Agreement PA 02-063, San Ramon Village Plaza June 3, 2008 t'OOIZOO ~ XVd OO:gl CIOZ/CI/LO 06/03/2008 14:27 FAX 9256485702 Bl'addocK&Logan !4I003/004 hereby agree that Developer's remaining inclusionary housing obligation under the Agreement shall be deemed satisfied by its payment of a fee in lieu of construction in accordance with this paragraph. Currently with its execution of this agreement, Developer has presented $89,412 to the City, which amount is equal to the fee in lieu of construction of one inclusionary unit under Resolution No. 56-02. B. Satisfaction. The City acknowledges that Developer has satisfied all of its obligations under the Agreement, as amended, and that therefore pursuant to Section 6 of the Agreement the Agreement is terminated and no longei" effective. Upon written request by Developer, the City Manager shall execute such docwnents as may be required by a title company to remove from the record title to the Property the previously recorded memoranda of agreement providing notice of the existence of the Agreement and the First Amendment. C. All other provisions of the Agreement shall remain in,full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the date and year first above written. CITY OF DUBLIN Dated: . By: City Manager Attest: City Clerk BRADDOCK & LOGAN, Group m, L.P., a California Limited Partnership By: Braddock & Logan ill, Inc., Its General Partner Dated:. 1097208.2 2 Amendment No.2 Affordable Housing Agreement PA 02-063, San Ramon Village Plaza June 3, 2008 J>-OO/{:OO ~ XVd OO:ST CT06/CTILO EXHIBIT A Property Description Portion of Lot I as shown on Tract Map 7437 for condominium purposes, recorded September 27,2005 in Book 285 of Maps, pages 56-61 in the Office of the Alameda County Recorder and further known as Unit 33 of Lot 1. Assessor Parcel Number 941-2829-007 (portion) 3 Amendment No.2 Affordable Housing Agreement P A 02-063, San Ramon Village Plaza June 3, 2008