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Civic San Diego Affordable Housing Master Plan

Land Use and Housing Committee M h 27, March 27 2013

Requested Action
LU&H Committee recommends that the City Council approves the proposed Affordable Housing Master Plan and directs Civic San Diego staff to proceed with implementation of the Master Plan pursuant to the consultant agreement between the City and CivicSD for providing services to the Successor Housing Entity.

HOUSING ASSETS
Owned by the City as Successor Housing Entity List of Housing Assets approved by DOF Include the following: 1) Encumbered Low/Mod funds for enforceable obligations 2) Unencumbered Low/Mod housing bond proceeds 3) 22 real properties acquired by former RDA for affordable housing purposes 4) Notes receivable, DDAs/OPAs 5) Ground G d leases l recorded d d on affordable ff d bl housing h i properties 5) Covenants (affordability restrictions) recorded on affordable housing properties Successor Housing Entity to create a Housing Asset Fund 3

Affordable Housing Master Plan


A guiding instrument to implement best practices, while optimizing housing production for targeted populations. Outlines strategies for the use of the housing assets retained by the Successor Housing Entity for the next 5 years Includes proposed uses for the real properties and proposed expenditures of the Housing Asset Fund Fund.
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Affordable Housing Master Plan Guiding Principles


1. 2. 3. 4 4. Maximize quality unit production with limited resources Homeless housing Maximize leverage with other funding sources D Development l t of f affordable ff d bl h housing i on real l properties ti retained by Housing Successor Entity 5. Geographic g p diversity y Fund p projects j City-wide y 6. TOD Fund projects with proximity to public transit 7. Catalyst for neighborhood investment 8. Sustainability 9. Allow for flexibility 10. Competitively bid to select development partners 11. Use conservative assumptions

Recent Accomplishments in Efforts to End Homelessness in Downtown & San Diego


# of homeless housed
Former RDA/CCDC Downtown 311 units completed 101 units in pipeline 242

Year(s)

Type of Housing

2009-2013

Development of 161 new supportive housing units &150 transitional housing 101 supportive housing housing, units in pipeline. Permanent housing (with vouchers) and supportive services Reunited with family members Permanent P th housing i (with ( ith vouchers) h ) and supportive services Permanent housing and supportive services

Campaign to End Homelessness in DT - Downtown

2010-2013

Downtown San Diego 44 Partnership Project P j t 25 San S Diego Region 100 Day Campaign to House Veterans San Diego Region TOTAL HOUSED 36 103

2012-2013 2012 2013 2012-2013 2012

736 + 101 in pipeline

Affordable Housing g Master Plan Partners/Community Outreach


San Diego Housing Commission (Board 2/15/13) County Department of Mental Health & Corporation for S Supportive ti Housing H i San Diego Housing Federation (2/4/13) Campaign to End Homelessness in Downtown Leadership Team (2/21/13) City Heights Area Planning Committee (2/4/13) Downtown Community Planning Council (2/20/13) Southeastern San Diego Planning Committee (4/8/13) Encanto Neighborhood Planning Group (4/15/13)
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Basic Components of Plan


1) 2) 3) 4) Properties Housing Bond Proceeds Revenues from Property Sales Investments in New Housing Production

Affordable Housing Master Plan Real Estate Assets


22 properties in downtown and Southeastern San Diego - 9 properties have existing affordable housing with affordability covenants and long term ground leases - 1 property t (Market (M k t Street St t S Square) ) with ith existing i ti h housing i with expired covenants with long term ground lease (currently ( y under negotiation g with owner for sale of land) ) - 12 properties available for future developments

Affordable Ho Housing sing Master Plan


Properties Available for Future Developments
Of 12 properties available for future developments: 5 downtown sites sites, including 50% of 13th and Market site site, are planned to be sold at market-rate to private developers for mixed-income, mixed-use projects
RFQ/Ps Q/ will be issued to solicit proposals Developers will be required to include at least 15% of total housing units for low/moderate income households Sales proceeds will be deposited to Housing Asset Fund to be used for future affordable housing projects

Remaining g 8 sites, , including g 50% % of 13th and Market site to be retained for future affordable housing developments
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Real Property with Expired Affordability Covenants Market Street Square

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Market Street Square


(Downtown - Marina)
Land Size: Current Use: 59,050 SF Existing rental housing (built in 1987) with 192 units with ground floor commercial space (10,000 SF) Affordable Housing Requirement: Minimum 40 units Ground Lease is in effect until Nov 2040. Ground lessee desires to purchase the land from the City and terminate the ground lease. Affordability covenants for 40 units expired in 2011 2011. Ground lessee has kept those units affordable and is committed to keep at least 40 units affordable if City agrees to sell the land.

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R lP Real Properties ti Recommended R d d to t Sell S ll for Mixed-Use Developments


1. 2. 3. 4. 5. 7th & Market (East Village, 55,000 SF) Park & Market (East Village, 52,000 SF) (Columbia, 27,000 SF) ) GSA Child Care Ctr Site ( Popular Market (East Village, 20,000 SF) (East Village, g , 20,000 , SF) ) 50% of 13th & Market (

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7th & Market


(Downtown - East Village)
Land Size: 55,157 SF Current Use: Public parking (surface) p Uses: Affordable & market-rate housing, g, commercial, , hotel, , public p parking p g (garage) (g g ) Prospective FAR/Zoning: Base 6.0, Max 8.0, Employment/Residential Mixed Use Affordable Housing Requirement: Minimum 15% of total units Notes: Issue a joint RFP for 7th & Market and Park & Market to solicit proposals from developers nation-wide.

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Park & Market Block


(Downtown - East Village)
Land Size: 52,030 SF Current Uses: Public parking (surface), construction laydown area, historic building (vacant) Prospecti e Uses: Prospective Uses Affordable & market-rate market rate ho housing, sing commercial commercial, hotel hotel, emplo employment-generating ment generating FAR/Zoning: Base 6.0, Max 10.0, Employment/Residential Mixed-Use Affordable Housing Requirement: 15% of total units Notes: Historic Remmen house to be preserved (potential move off-site) Issue a joint RFP for 7th & Market and Park & Market to solicit proposals from developers nationwide.

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GSA Child Care Center


(Downtown Columbia)
Land Size: 26,905 SF Current Uses: Child care center, playground, pool Prospective Uses: Commercial (office, retail), hotel, affordable housing FAR/Zoning: Base 9.0, Max 14.0, Core Affordable Housing Requirement: 15% of total units Notes: Potential joint development with Columbia Tower surface parking (15 (15,000 000 SF) Existing lease with GSA until Feb 2015 Issue RFP upon expiration of the lease

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Popular Market
(Downtown East Village)
Land Size: 19,924 SF Current Uses: Convenience store, restaurant, parking, storage Prospective Uses: Affordable & market-rate housing, commercial FAR/Zoning: Base 10.0, Max 10.0, Neighborhood Mixed-Use Center Affordable Housing Requirement: 15% of total units Notes: Northeast portion of site traversed by earthquake fault Adjacent to City College Trolley Station

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13th & Market


(Downtown East Village)
Land Size: 20,000 SF (50% of the entire site) Current Uses: Vacant lot and structures Prospective Uses: Affordable & market-rate housing, commercial FAR/Zoning: Base 6.0, Max 10.0, Neighborhood Mixed-Use Center Affordable Housing Requirement: 15% of total units Notes: Acquisition of one parcel (3,000 SF) is remaining The other half of the site will be used as Hotel Metro replacement site

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Real Properties Recommended to Hold for Future Affordable Housing g


1. 2. 3. 4. 5 5. 6. 7 7. 8. 4th & Beech (Atmosphere, 205 units) 50% of 13th & Market (Alpha Square, 193 units) Monarch School (For future RFP, 100% affordable) 13th & Broadway (Fire Station site, Not within next 5 years) Hilltop & Euclid (For future RFP RFP, 25% affordable) Ouchi Site (25% affordable) 6395-97 6395 97 Imperial (For future RFP, RFP 100% affordable) 40th & Alpha (For future RFP, 100% affordable)
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Atmosphere
(Downtown Cortez) ( )
Lot Size: Current Use: Proposed Uses: 32,452 SF Vacant lot and existing structures Low-mod Low mod housing (12 story, 205 units) with ground floor commercial % Affordable: 100% Type/Affordability: Family & Special Needs, 30-60% AMI S pporti e Ho Supportive Housing: sing 41 units nits (MHSA f funding nding is set aside b by Co County) nt ) Estimated Subsidy: $12.2M Wakeland Housing (Developer) had ENA with F Former RDA ( (expired) i d) Fully designed Across from future St. Joseph's park site Proposed p funding g sources include 4% and 9% TC, MHSA, TOD/Infill (HCD), Project Based Section 8 Vouchers For HCD funding application (due in June 2013) need executed DDA & Ground Lease by 2013), May 2013 Negotiate a DDA with Wakeland Housing

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13th & Market


(Downtown East Village) ( g )
Lot size 20,000 SF of 40,000 SF site the other half to be sold for private development) Current Use: Existing structures Proposed Uses: Hotel Metro Replacement Housing (min. 193 units) % Affordable: 100% Type/Affordability: Special Needs, Extremely to Very Low- & Low- Income Supportive Housing: Minimum 15% Estimated Subsidy: $17.16M

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Hotel Metro/13th & Market


(Downtown East Village)
Background g Total 193 SRO units Deteriorating physical conditions due to construction deficiencies and deferred maintenance The land is owned by SDHC and leased to San Diego SRO until 2044 Goals Negotiate a DDA & Ground Lease with the owner of existing Hotel Metro (improvements) Negotiate an Option Agreement with SDHC to acquire the land Demolish existing buildings and build replacement project at 13th & Market Sell the lots for market rate development after demolition of existing buildings, use sales proceeds for future affordable housing 22

Monarch School
(Downtown Little Italy) ( y)
Lot Size: 14,801 SF Current Use: Monarch School P Proposed d Uses: U L Low-mod dh housing i with ith ground floor commercial Estimated # of Units: 50 units % Affordable: 100% Affordable Type/Affordability: Family & Special Needs Supportive Housing: Minimum 15% Estimated Subsidy: $7 5M $7.5M Monarch School will relocate to the new expanded facility y in spring p g 2013 Directly across from Little Italy Trolley Station Size of project may be limited by sites lower FAR, height restriction, size/dimensions and proximity to bayfront water table (limiting underground parking) Issue RFP in FY 2014 23

13th & Broadway


(Downtown East Village) ( g )
Lot Size: 19,001 SF Current Use: Trailer/vehicle storage Proposed p Uses: Affordable housing, g, fire station, , ground g floor commercial % Affordable: 100% affordable Type/Affordability: TBD Supportive pp Housing: g Include minimum 15% of affordable units Estimated Subsidy: TBD (Not included in Master Plan) The project will not be able to proceed until funding for the fire station is identified and secured Site footprint, parking access and other design issues will depend on the fire station design. Need coordination with the Fire Department

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Hilltop and Euclid Site


(Southeastern San Diego ( g Central Imperial) p )
Lot Size: 372,081 SF Current Uses: Vacant land P Proposed d Uses: U Aff d bl & marketAffordable k t rate housing, commercial Estimated # of Units: 100 units % Affordable: 25% Type/Affordability: TBD Supportive Housing: TBD Estimated Subsidy: $2M (for 25 units) The Community expressed desire for commercial d development l t and d market-rate k t t housing to stimulate economic development in the area. Site constrained by a tributary to Chollas Creek and associated wetlands Issue RFQ/P in FY2015-16

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Ouchi Site
(Southeastern San Diego Central Imperial)
Land Size: 50,529 SF Current Use: Vacant commercial and residential buildings Proposed Uses: Mixed-income hsg Estimated # of Units: 35 units % Affordable: 25% Type/Affordability: TBD Supportive Suppo t e Housing ous g: TBD Estimated Subsidy: $720,000 (for 9 units) Public improvements for complete street standards (curb, gutter, sidewalks, utility undergrounding, trees) underway on Holly Drive adjacent dj tt to th the property. t

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6395-97 Imperial
(Southeastern San Diego Central Imperial)
Lot Size: Current Use: 7,431 SF Vacant commercial and residential id i l buildings b ildi Proposed Uses: Low-mod housing Estimated # of Units: 4 units % Affordable: 100% Type/Affordability: TBD Supportive Housing: TBD Estimated Subsidy: $400,000 $ Site is a narrow, shallow, interior l t with lot ith alley ll access on a commercial corridor Issue RFP in FY 2014 Potentially o e a y de developing e op g the es site e in combination w/ adjacent vacant and/or underutilized lots

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40th & Alpha


(Southeastern San Diego Southcrest)
Lot Size: 21,000 SF Current Use: Vacant land Proposed Uses: Low-mod housing Estimated # of Units: 6 units % Affordable: 100% Type/Affordability: TBD Supportive Housing: TBD Estimated Subsidy: $480,000 $480 000 Site is located in a single-family neighborhood, across from Southcrest Park and Cesar Chavez Elementary School Estimated to have six units (single family or duplex units) Issue RFP in FY 2014 Potentially develop the site w/ nearby City surplus lots

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Other Pipeline Projects

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Hotel Churchill
(Downtown East Village) ( g )
Rehabilitation of vacant and dilapidated SRO building owned by SDHC Current Use: 92-unit SRO Hotel, Vacant since 2005 Proposed # of Units: 60 SRO units % Affordable: 100% affordable Type/Affordability: Individuals & Special Needs/Very Low-Income Supportive Housing: Minimum 15% of affordable units Estimated Subsidy: $3M (per request by SDHC) Locally designated historic building SRO restrictions require at least 57 SRO units it f for 30 years Requires substantial rehabilitation to make it habitable Two blocks from City College MTS station 30

VVSD V
(North Bay) ( y)
Phase V of Veterans Village of San Diego for female veterans Proposed # of units: 20 transitional beds for female veterans % Affordable: 100% affordable Type/Affordability: Transitional housing for veterans w/ Special Needs / Extremely low-income Supportive Housing: 100% Estimated Subsidy: $1.8M ($90k/bed) Ph Phase V will ill also l add dd other h amenities such as a library, gym and classrooms. On On-side side supportive services will be provided by VVSD Upon completion of Phase V, the site will have a total of 364 t transitional iti l beds b d for f homeless h l veterans 31

HOUSING ASSET FUND 5-Year Projections Revenues and Expenditures

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Housing Asset Fund Affordable Housing Bond Proceeds


Former Project Area North Park Southeastern SD North Bay City Heights Centre City Horton Plaza NTC Crossroads TOTAL (City-wide) Balance $2,580,000 $1,407,000 $1,846,000 $3 542 000 $3,542,000 $16,560,000 $277,000 $ $2,959,000 $3,700,000 $32,871,000

NOTES: City Heights and Southeastern SD communities previously expressed expectations for the bond proceeds generated in their project areas be spent within their neighborhoods. The funds will be set aside for those communities. 33

Housing Asset Fund Loan/Ground Lease Payments & Other Program Incomes
FY2013
Loan Repayments/Ground Lease Payments Rental/Other Income Property Management Costs Reserve Cost Savings TOTAL REVENUES $450K $1.4M ($ ($45K) ) ($189K) $850K $2.5M $1.3M $640K $520K $635K

FY2014
$492K $959K ($ ($45K) ) ($154K)

FY2015
$535K $269K ($ ($45K) ) ($119K)

FY2016
$620K $30K ($ ($45K) ) ($85K)

FY2017
$748K $30K ($ ($45K) ) ($98K)

TOTAL
$2 8M $2.8M $2.7M ($ ($225K) ) ($645K) $850K $5.5M

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Housing Asset Fund Projected Land Disposition Proceeds


FY2013
Market St. Square 7th & Market Park & Market GSA Popular Market 13th&Market (Half) Hotel Metro Gross Proceeds Civic SD 4% Fee Net Proceeds

FY2014 $6.0M $8.3M $ $6.5M

FY2015

FY2016

FY2017

TOTAL $6.0M $8.3M $ $6.5M

$3.4M $1 6M $1.6M $0.7M $1.1M $21.5M $859K $20.6M $1.6M $64K $1.5M $3.4M $135K $3.2M $1.1M $45K $1.1M

$3.4M $1 6M $1.6M $0.7M $1.1M $27.6M $1.1M $26.5M 35

Civic SD 4% Transaction Fees


For land sales for mixed-use developments, charge transaction fee equal to 4% of gross sales prices prices. Estimated total fees earned during 5-year plan period - $1.1 M The fees are proposed to fund the following potential housing efforts:
1. Creation of public/private TOD investment fund w/ emphasis on affordable housing; 2. Enhanced planning in urban neighborhoods to facilitate TOD and affordable housing; 3. Work with state representatives to sponsor new state legislation that supports funding for affordable housing, housing economic development and neighborhood infrastructure; 4. Collaboration with other local governments to create a permanent local g source for affordable and homeless housing; g; and funding 5. In collaboration with local financial institutions, establish a financing mechanism for rehabilitation of SROs, satisfying Community Reinvestment Act objectives. 36

Housing Asset Fund Ad i i t ti Costs Administrative C t


FY2013
Housing & Homeless Admin (Civic SD Staff time) Legal/Consultant Costs Homeless Consultant $275K

FY2014
$550K

FY2015
$550K

FY2016
$550K

FY2017
$550K

TOTAL
$2 5M $2.5M

$200K

$200K

$200K

$600K

$100K

$100K

$100K

$300K

Total Admin. Costs

$275K

$850K

$850K

$850K

$550K

$3.4M

Note: Total Admin. Costs is 5.2% of total projected asset value. 37

Funds Available for Affordable Housing Developments


FY2013
Unencumbered Bond Proceeds Revenues from Housing Assets Net Land Disposition Proceeds Less Admin. Costs Total Available for Affordable Projects ($275K) $35.1M $32.9M $2.5M $1.3M $640K $520K $635K

FY2014

FY2015

FY2016

FY2017

TOTAL
$32.9M $5.5M

$20.6M
($850K) $21.0M

$1.5M
($850K) $1.3M

$3.2M
($850K) $2.9M

$1.1M
($550K) $1.2M

$26.5M
($3.4M) $61.5M

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Proposed Affordable Housing Projects


FY2013 FY2014
Subsidies for Projects on City-owned properties Atmosphere 13th & Market (50%) Hilltop & Euclid O hi Site Ouchi Sit 6395-97 Imperial 40th & Alpha Monarch Site 13th & Broadway Subsidies for Other Projects Churchill VVSD V City-wide NOFA

FY2015

FY2016

FY2017

TOTAL
$ 40.5M $ 12.2M

$12.2M $ 17.2M $2.0M $ 0 0.72M 72M $ $ 0.4M 7.5M $ 0.48M

$ 17.2M $ $ $ $ 2.0M 0.4M 7.5M 0

$ 0 0.72M 72M $ 0.48M

$ 4.8M $ $ 3.0M 1.8M $8 0M $8.0M $7 1M $7.1M $ 3.0M $ 1.8M $ 15 15.1M 1M

TOTAL USE BALANCE

$12.2M $22.9M

$31.1M $12.9M

$8.0M $6.2M

$9.1M $0

$0 $1.2M

$60.3M 39

City-wide y NOFA
Ensure geographic diversity Potentially in collaboration with SDHC and other local funding partners A total of $15M available in FY2015 and FY 2016 Objectives and selection criteria to be determined Emphasis on affordable housing with units targeted for the homeless population (minimum 40% of units projected) j t d) 15% of units to be set aside as supportive housing $3.5M $3 5M will be set aside for City Heights
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City of San Diego


Where are the gaps larger populations of unsheltered homeless and no housing? g

400
unsheltered

381

107

1,049
unsheltered

974
unsheltered h lt d

430

2 090 2,090

66 12 78

583
unsheltered

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Affordable Housing Units Targeted for the Homeless pop population lation
Type of units for the formerly homeless & at-risk population: 1) Supportive housing units w/ intensive supportive services (require service funding) 2) Extremely low low-income income studios/living units w/ minimum services for population w/o severe disabilities (in combination with rental vouchers) Could be provided in new developments or through acquisition & rehabilitation of existing vacant and/or underutilized apartment/motel complexes Consider addressing need for interim/transitional housing and emergency shelters
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Possible Reestablishment of Other Housing Programs


If actual revenues exceed expectations p or actual investments in projects are less than projections, the additional proceeds could be invested in:
- HELP Program - Transitional T iti l Housing H i Program P for f Homeless H l Seniors S i

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Affordable Housing Master Plan Estimated Affordable Housing Production


# of Low/Mod Units Low/Mod units in mixed-Income housing developed by market-rate developers on Housing g Assets ( (not subsidized by y HTF) ) Low/Mod units in affordable and mixedincome housing developed on Housing Assets (subsidized by HTF) Other affordable housing projects City-wide subsidized by HTF TOTAL 285 488 # of Homeless Housing 0

241

268 1 041 1,041

155 396 44

Does not include pipeline projects (Connections Housing, 9th & Broadway or COMM22).

Schedule
Civic SD Board LU&H City y Council 3/27/2013 3/27/2013 April p 2013

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