Housing Successor Agency
MEETING DATE: 3/23/2016
TITLE:
Title
Exclusive Right to Negotiate with Riverside Housing Development Corporation on Nineteen Housing Successor Agency Owned Parcels Located throughout the City
End
FROM:
Tami E. Scott, Administrative Services Director
RECOMMENDATION:
Recommendation
Staff recommends the City Council authorize an Exclusive Right to Negotiate between the City of Cathedral City, in its capacity as the Housing Successor Agency, and Riverside Housing Development Corporation for nineteen affordable housing in-fill parcels.
Body
BACKGROUND:
The City, in its capacity as the Housing Successor to the former Cathedral City Redevelopment Agency, currently owns 92 parcels, one of which is developed with a vacant duplex and 8 that are under disposition and development agreements. Of the parcels not under contract, 40 are large enough to provide development opportunity for other than a single-family in-fill. Several of these, however, are raw desert lacking infrastructure and affordable development of these parcels is unlikely in the foreseeable future unless another sustainable source of funding for affordable housing is identified.
Even though redevelopment agencies have been disbanded as a result of State legislature, redevelopment affordable housing obligations continue to exist and, in fact, more stringent requirements have been adopted. This presents a significant challenge to cities in that on-going redevelopment associated affordable housing funding is no longer available. As such, the City finds that its primary source of assistance in the development of affordable housing is its real property assets.
DISCUSSION:
Staff has been in discussion with Riverside Housing Development Corporation (RHDC), the non-profit affordable housing developer located in Riverside, California that successfully administered our rehabilitation programs beginning in FY 2007-08 through the demise of redevelopment, about possible development of these parcels. RHDC also has extensive development experience in other jurisdictions which tax-credit multi-family projects, historic rehabilitation and resale and single-family affordable development.
RHDC has expressed an interest in further exploring the development feasibility for several sites totaling 19 of our housing parcels, all of which are vacant land with the exception of a vacant duplex located on Navajo Trail. The intent would be, in most cases, to develop “for-sale” ownership single-family homes although they believe that one site on Landau may have potential for denser development. RHDC has requested an exclusive negotiating period for, at minimum, six-months in order to conduct their due diligence to include identifying appropriate development options, necessary off-site improvement and associated development costs and fees. During this exclusive negotiating period, the City would not entertain other development or purchase proposals for these particular in-fill parcels. Should RHDC determine that affordable housing development is not feasible on one or more of these parcels, they would immediately notify staff of same and the particular parcel would then immediately be released from the exclusive agreement. RHDC has also agreed to turn over all due diligence material obtained by them during the negotiating period if it becomes apparent that mutually agreed upon business terms cannot be reached for development of any of the parcels.
Entering into an Exclusive Right to Negotiate does not commit the City and/or the Housing Successor Agency to anything beyond assuring RHDC that while they are conducting their due diligence studies, the City will not sell or commit the properties to any other developer. Should the studies indicate that affordable housing is feasible on one or more of these sites given current financial constraints, a Disposition and Development Agreement will be prepared and be brought back to the Council for consideration at a future public hearing. If RHDC determines that they cannot move forward with affordable housing development, the City will benefit from the studies that they have conducted.
The listing of the Housing Agency Owned parcel numbers as well as maps are attached.
FISCAL IMPACT:
There is no fiscal impact associated with entering into a six-month Exclusive Negotiating Agreement with the Riverside Housing Development Corporation other than staff time that may be needed to review their findings and, potentially, to draft the business terms of a future Disposition and Development Agreement.
ATTACHMENTS:
Exhibit Listing Housing Agency Owned Parcel Numbers
Map Exhibit of Parcel Locations