Monday, April 26, 2010
Maydestone Moving Forward
On Tuesday the City of Sacramento will approve a loan increase to the Redevelopment Agency to increase the loan from $4,570,000 to $6,100,000 for acquisition, construction, and permanent financing of the 32-unit historic Maydestone apartment building. This 4-story landmark building is located across the Memorial Auditorium at 15th and J Streets. The property has been vacant and boarded for more than six years due to a fire and needs substantial improvements.
Since Redevelopment Agency funding approval was obtained in April 2009, D & S Development, Inc. (Developer) has been working diligently to secure conventional bank financing to proceed with the renovation. Under the current restrictive lending environment, the Developer has been unable to obtain a construction or permanent loan from a conventional lender. The result is a loss of approximately $2 million in project financing. To fill this gap, the Developer is contributing an additional $100,000 of Owner Equity, costs savings of $370,000 have been identified, and the Developer is requesting an additional $1,530,000 in Agency funds. Staff is seeking approval for an additional $1,530,000 in Downtown Low/Moderate Housing Funds to augment the existing $4,570,000 Agency loan which will increase the loan to $6,100,000.
The $1.53 million of new Agency funds will consist of a $1.23 million nonforgivable loan and $300,000 to be forgivable pursuant to costs associated with ADA/accessibility upgrades including related off-site improvements due to public funding requirements. In consideration for the increased Agency loan, eight market rate units will now be restricted at 110% of Area Median Income for 55 years.
The 4-story apartment building built in 1915 has been vacant and boarded for over six years. The proposed project will convert 32 dilapidated units into 24 studio units, and 8 one-bedroom units affordable to households who earn between 60 -110% of the area median income. Amenities will include a renovated basement for primary use as community space with a community room, manager's office, exercise room, individual storage, and a laundry room.
The Developer must complete construction of the project by February 1, 2012.