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~J <br />CITY OF SAN LEANDRO <br /> <br />CITY COUNCIL BUSINESS DEVELOPMENT COMMITTEE <br />March 9, 2006 <br />4:00 p.m. - 5:30 p.m. <br />San Leandro City Hall <br />835 East 14t~ Street <br />San Leandro, California <br />Sister Cities Gallery Room <br />HIGHLIGHTS <br />Committee Members: Mayor Young, Councilmember Stephens <br />City staff present: John Jermanis, Hanson Hom, Uchenna Udemezue, Thomas Liao, Keith <br />Cooke, Reh-Lin Chen, Jean Hom, Ryan Evans <br />Public present: Frank Carson, Louis Chicoine, Bill Clark, Heidi Finberg, Charles <br />Gilcrest, Larry Hood, Sheela Jivan, Brad Jorgensen, Patrick McGaughey, <br />Jay de los Reyes, Gerry Tierney, Bill Vierra, <br />The meeting was called to order at 4:10 p.m. <br />L Discussion Regarding Development Proposal for Mission Bell Apartments (112 East 14t~' <br />Street) <br />The City Manager began by providing a brief background on the existing mixed-income and <br />mixed-use Mission Bell Apartment building and summary of Allied Housing's (AH) proposal to <br />acquire it. The San Leandro Redevelopment Agency had loaned Housing Set-Aside funds in the <br />recent past to the Mission Bell Apartments owner, the Jorgensen family, who were now selling <br />the property through a 1031/Starker Tax Exchange. AH is a 501(c)(3) nonprofit housing <br />developer with offices in Hayward and Fremont. <br />Tom Liao outlined AH's proposal (see attached) including the financing plan and benefits of the <br />proposed project to the City. AH is proposing to purchase the property for $3.4 million and <br />convert the existing 25 apartment units into affordable housing for very low and extremely low <br />income renters. The proposed project will provide the City with a net gain of 11 new affordable <br />rental housing units because the existing 11 moderate income and market rate units will serve <br />very low income households. <br />AH will seek to close escrow in April 2006 through a combination of short-term and permanent <br />financing from private andlor nonprofit lenders. However, it is requesting $l.l million from the <br />City to pay off the short-term loans. The City will use its entire allocation of McKinney Refund <br />Act funds and federal Home Investment Partnership Program (HOME) funds for its $1.1 million <br />subsidy. Staff recommends the City offer the loan as deferred for 55 years at 3% interest with <br />