Folsom lends cash to affordable housing project
Folsom will gain 54 low-income and very low-income housing units thanks to the Folsom City Council/Redevelopment Agency’s approval of two loans at a Feb. 8 joint meeting.
The Forestwood Family Apartments project, located at 9483 Greenback Lane, sits on 2.5 acres of infill property and will have a total of 55 units, which will come in one-, two- or three-bedroom designs. One unit will be a manager’s apartment, 43 will be low-income (60 percent of area median income) and 11 will be very low-income (50 percent of area median income).
Rents will range from $685 to $1,140.
The complex is near transit, shopping and services. Residents will have access to a variety of on-site social programs such as job training, after school and homework clubs, health screening, community resources and community social events.
City staff has been working with USA Properties Fund to build an affordable housing project on the site since 2005. On Dec. 4, 2009, the Folsom Redevelopment Agency entered into an Affordable Housing Loan agreement with USA Properties in the amount of $2.5 million.
After dealing with subsequent real estate market and financing changes, USA Properties and city staff negotiated an agreement for two bridge loans to get the project underway. USA Properties owns the land and an environmental mitigated negative declaration was approved for the project.
Folsom Community Development staff member Sarah Bontrager presented the proposed resolutions to approve the loans.
The first is a $500,000 loan from Folsom’s Housing Trust Fund, to be repaid at 3 percent interest over 10 years. This loan will be secured by a corporate guarantee from USA Properties.
The second bridge loan is in the amount of $625,000 in HOME funds from the Sacramento Housing and Redevelopment Agency. HOME funds are limited to producing low-income housing through new construction, rehabilitation or acquisition.
Total project costs, including fees and interest, are estimated at $12.6 million. USA Properties has a private construction loan in the amount of $4.545 million, which has precedence over the other loans. The city loan of $500,000 is second in line. The Redevelopment Agency loan in the amount of $2.5 million is third, and the Sacramento Housing and Redevelopment Agency loan in the amount of $625,000 is fourth.
In approving the bridge loans, the Folsom City Council members/Redevelopment Agency directors said the project will provide needed worker housing and add to the city’s inventory of affordable housing as required in the General Plan Housing Element.
They also referred to their decision at the Jan. 11 City Council meeting to forego “inclusionary” affordable housing mandates in single-family housing projects in favor of affordable rental housing.
There are no single-family housing projects on the horizon and if there were, the number of affordable units would be 15 percent of the total. That means there would be eight units compared to the 54 at Forestwood.
USA Properties has a track record with Folsom. It has successfully completed two senior housing complexes on Creekside Drive.
The company was founded in 1981 in Santa Monica and moved its corporate headquarters to Roseville in 1993. USA Properties is a member of Volunteers of America, American Seniors Housing Association, Home Aid Sacramento, Life Steps and Build it Green, as well as several building industry associations. It has 10,000 units of senior and family apartments.
Senior Vice President Steven Gall attended the meeting and thanked the council members and city staff after the positive vote.