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HomeMy WebLinkAboutAgenda: Study Session: Senior Housing at 16 Campus DriveBACKGROUND DISCUSSION STAFF REPORT Arcadia Redevelopment Agency DATE: March 2, 2010 TO: Chairman and Members of the Agency Board FROM: Jason Kruckeberg, Assistant City Manager /Development Services Director By: Jerry Schwartz, Economic Development Manager L IWS SUBJECT: STUDY SESSION: PROPOSED AFFORDABLE SENIOR HOUSING DEVELOPMENT AT 16 CAMPUS DRIVE Recommendation: Provide Direction During the Study Session at the February 2 meeting, staff presented a proposal to develop the Campus Commons, a 43 -unit affordable senior housing project at 16 Campus Drive. The project is proposed by the development team of Davila Properties and Ashwood Construction. The proposed site is a 23,000 sq. ft. lot that currently has seven apartments and is located just east of the baseball field at Arcadia High School. The Agency Board requested that -staff contact the Arcadia School District to find out their thoughts about the proposed project and to further evaluate the financial issues. Staff has made that contact and it is summarized below, along with a brief review of other issues related to this project. The concern expressed by the School District was that the residents at the Campus Commons, even if they are aware of the location adjacent to the high school, might eventually have issues with school - related activities, including nighttime athletic events, daily band practice, or the din of students on Campus Drive in the mornings and afternoons. There was also concern about traffic on Campus Drive and the intersection of Campus Drive and Santa Anita Avenue at peak times. The District recognized that any development at this site would likely present some conflicts with the high school, and that a senior housing project is a low traffic generator compared to a commercial project. The development team has attempted to address some of the Arcadia School District's concerns in the package that is attached to this staff report. The marketing team used by the developers has experience working with senior housing projects that are located next to schools, and has had success with intergenerational activities that utilizes the seniors to interact with the students. Additionally, the developers note that there are not many affordable housing options for seniors, and the residents who live there will be glad for the safe and high quality living environment. They also believe it is possible to mitigate some of the noise from the school with the proper construction materials and reduce the impact of lights from the baseball field through the use of mature landscaping as a border. REVIEW OF MAJOR PROJECT ELEMENTS The proposed 43 -unit Campus Commons project is three stories over one parking level for a total of four stories and a height of 46 feet. The density of 81 units per acre is greater than the 63 units per acre allowed for senior housing on a commercially zoned property. As discussed at the February 2 study session, these issues could be dealt with through a Conditional Use Permit, Design Review, and other potential entitlements. The development team prepared a project pro forma for a 33 -unit project that would meet the allowed density at the project site. The result, as shown on the first page of the attached materials, is that the construction costs would not decrease proportionally, and the Agency's potential subsidy, on a per unit basis, would actually increase. Additionally, the developers have received feedback from a lender and a tax credit buyer, both of which have significantly less interest in being involved in a project that is under 40 units. The attachment from the development team also includes a summary of elements that are part of an optimal senior housing site, and how 16 Campus Drive meets most of the criteria. The development team is proposing to fund the project with 4% .tax credits and tax exempt bonds. It is requesting $6.9 . million from the Agency to fund the - gap :between the other funding sources and the total project costs. Staff has provided a table that shows the Agency's financial status for both the general redevelopment account and the low /mod housing fund. It is important to remember that the Agency owes $4,045,715 to the housing fund, and a portion of the repayment could be invested in the Campus Commons project. As was discussed at the February 2 Study Session, Kathe Head, the Agency's housing consultant, indicated that the Agency could provide the funds requested by the development team, but that it would need to be invested over time to comply with State Law rather than as one lump sum payment. CONCLUSION The Agency Board should determine: a) Is this site appropriate for a senior housing development? b) Are the height, density, and other development standards appropriate for the site? c) Is the proposed Agency financial participation appropriate, given that it would be the Agency's last senior housing project? Staff Report March 2, 2010 Page2of3 RECOMMENDATION Provide direction. Approved by: ..SZ -P+--) Donald Penman, City Manager /Executive Director Attachments: Staff Report from February 2, 2010 Study Session Arcadia Campus Commons Senior Apartments package Table of Agency's Affordable Housing revenues Staff Report March 2, 2010 Page 3 of 3 Staff Report from February 2, 2010 STAFF REPORT Arcadia Redevelopment Agency DATE: February 2, 2010 TO: Chairman and Members of the Agency Board FROM: Jason Kruckeberg, Assistant City Manager /Development Services Director SL By: Jerry Schwartz, Economic Development Manager .c SUBJECT: STUDY SESSION: PROPOSED AFFORDABLE SENIOR HOUSING DEVELOPMENT AT 16 CAMPUS DRIVE Recommendation: Provide Direction BACKGROUND The Arcadia Redevelopment Agency has received a proposal to develop an affordable senior housing project at 16 Campus Drive, adjacent to the Arcadia High School baseball field. There are currently seven apartments on the project site. The project is being proposed by Davila Properties, which put together the Heritage Park senior housing project on Live Oak, and Ashwood Construction, a builder of multiple family housing projects. The proposal is to develop and manage a 43 unit project for low and very low income senior citizens. The four story project will include amenities for the - residents, - and the location is clo to the Community Center, Library, and Arcadia. County Park. The proposed financing plan would include a contribution of the Agency's low /mod housing fund designed as a long term loan, similar to Heritage Park. The major elements and issues of this proposed development are discussed below. ARA AFFORDABLE HOUSING FUNDS As was discussed during the adoption of the Five Year Implementation Plan last December, one of the Agency's main responsibilities is to improve and increase the supply of affordable housing. The Agency assisted in the construction of Heritage Park, a 54 -unit senior project that opened in 2004, and the Alta Street Classics, a six -unit townhome project for first time homebuyers. The Agency invested $1.8 million in the Heritage Park project and $2.2 million in the Alta Street Classics. In July 2009 the Agency closed escrow on the property at 15 Lucille Street at a cost of $538,000, and it should be developed for up to four units of affordable housing. At the beginning of the 2009 -2010 fiscal year, the Agency had $5.1 million in its affordable housing fund. Up to 34% of the Agency's current and future affordable housing funds can be spent for additional senior citizen housing. We have worked with our consultant, Keyser Marston, to develop an accounting of the total amount of senior housing dollars available (current and future) to be expended and this information will be available at the study session. One of the key decisions to discuss is how this money should be expended. ENTITLEMENT AND ZONING ISSUES The proposed project would be a four story, 43 -unit senior citizen apartment project on a 23,000 square foot site. Drawings that show the proposed project design is included as part of the attachments to this staff report. The project is proposed as three levels of residential units over a parking level for a total height of 46 feet. The units range from 625 to 777 square feet in size and the project would include a community room and a great deal of private open space on the east side. Because the site is zoned for commercial use, the commercial zoning standards would apply. A full design review and site plan review would occur as part of the entitlement package but several major project issues are described below. The project would require a Conditional Use Permit, Design Review, and potentially several additional entitlements. Public hearings would be required with both the Planning Commission and the Agency. Site Planning Issues Despite the commercial zoning of the site, this property is developed with 7 residential units. The lot is in an excellent location for senior housing. The site is close to a number of amenities and services and meets all relevant criteria for financing. Through careful design of windows and sound attenuation, the proximity of an active open space area at the High School can be viewed as an asset rather than a liability for residents of the units. Additional open space is planned as a buffer between the units and the commercial property to the east. Parking is under the units, opening up the site to allow this important open space end to allow the increase in density sought. Density The Arcadia General Plan has a specific density allowance for senior affordable housing of 63 units per acre on commercially zoned property. When this standard was set by Resolution in 2002, a base density of 50 units per acre was applied to market rate senior housing and a density bonus of 25% was added for affordable senior housing to reach the number of 63 units per acre. The proposed project is 81 units per acre. The applicant has stated that at least 40 units are needed for this project to be attractive for financing and for a senior affordable project in this location to pencil out. As part of the entitlement package, a General Plan Amendment would be necessary to allow this increase in density. Height The allowable height in this zone is 40 feet and 3 stories. The proposal would be 4 stories and 46 feet in height. Affordable housing law allows "concessions" to be made through the approval process to facilitate the construction of such housing by relaxing development standards. For example, concessions were granted to the Alta Street Classics affordable housing project (guest parking and a setback) to enable that project Staff Report February 2, 2010 Page 2 of 4 to proceed. The height requested by the applicant could be addressed through a similar concession. Parking Parking is proposed for the project at a rate of .9 spaces per unit. There is no question that senior housing projects require less parking than standard housing and affordable housing projects limited to those 62 years of age and over also require Tess parking. The Arcadia Municipal Code does not specify a parking requirement for senior housing; the parking rate is determined on a case by case basis through the CUP process. In this case, the rate of .9 spaces per unit has proven to be ample for similar projects and the applicant is confident in this number. Much of the service to this development would be pick -up and drop -off service in front of the building. Because of the school, there is no on- street parking to consider. FINANCIAL PROPOSAL The development team is proposing to fund the project in the lowest cost method possible so that the low and very low income rents can cover the operating and financing costs. The financing proposal includes applying for 4% tax credits and issuing tax exempt bonds. This is the method that was used for the Heritage Park project. Like Heritage Park, this process leaves a funding gap that would be bridged through a deferred loan from the Agency's low and moderate income housing fund. According to the project pro forma provided by the development team, the total estimated project cost is $12,359,466, and it would include a $6.9 million deferred loan from the Agency's low /mod housing fund. As discussed above, the Agency began the current fiscal with about $5.1 million in affordable housing fund. It is important to note that the Agency owes $4,045,715 to the housing fund, and that these funds could be repaid as soon as later this calendar year if it proceeds with a tax allocation bond issue. This $6.9 million proposed as a participation amount would effectively make this the last affordable senior housing project that the Agency could develop. The details of how the Agency would invest its housing funds would be worked out with the developers if there is direction to proceed with this project. ISSUES TO CONSIDER In its deliberations, the Agency Board should consider these questions: a) Is this the appropriate location for a senior unit development? b) Are the height and density and other development standards appropriate for the site? c) The proposed Agency participation would make this the last affordable senior housing project the Agency would develop. Is this a desired use of the Agency's funding and at what amount? Staff Report February 2, 2010 Page 3 of 4 As you know, significant development sites are difficult to find in Arcadia. High land costs in Arcadia increase the Agency's level of financial participation for affordable housing. Receiving a proposal to develop affordable housing certainly facilitates the opportunity to expend our low /mod funds and eliminate any future concerns about excess surplus. If the Agency Board chooses to proceed, it would be partnering with an experienced development team that has successfully developed multiple family housing in Arcadia. Additional information from the developers about the project, financing plan, their experience, and proposed design are attached to this staff report. RECOMMENDATION Provide direction. Approved by: 3>or,a.-c.Q Donald Penman, City Manager /Executive Director Exhibit A: "Campus Commons" Project Description and Information Package Staff Report February 2, 2010 Page 4of4 Arcadia Campus Commons Senior Apartments Package from Developers ARCADIA CAMPUS COMMONS SENIOR APARTMENTS February 9, 2010 1 As follow up to the comments and questions posed by the City Council regarding the proposed Campus Commons Affordable Senior Apartments, we are providing additional information and input regarding the following topics; 1. Site Compatibility with Arcadia High School; the placement of senior communities adjacent to facilities with high level of activities is typically considered a positive for locations. Examples and input from a highly regarded market analyst in senior housing is attached to provide you a glimpse into how the facilities are received with evaluations directly from the day to day managers. There is substantial information from the senior housing industry to support the position and we can provide the additional material as needed. Ultimately the primary goal is to provide quality, safe, and affordable housing for our senior population who have limited housing options. Out residents are frequently coming from housing that may be unsafe or isolating to seniors because of makeup of the residents around them, substandard properties, or they may no longer be able to afford to remain in Arcadia or the surrounding communities. It may also be the only opportunity for residents to move closer to family members who can support them emotionally and enhance their wellbeing. a. Site Development; the property has been marketed for commercial development and will be again if we are not successful in acquiring the site. The land has been in escrow previously subject to financing which could not be.obtained.at this time. However a more intense commercial use will occur on the site in the future if not developed as senior affordable housing. The point being that the senior housing project will be a less intrusive neighbor to the school and surrounding uses than will businesses that will be impacted by traffic flow and pedestrian traffic. The ownership will not sell the property based on the existing use. 2. Development/Financing Timeline: attached is a financing and entitlement timeline for the project. The timeline indicates the critical tasks and the time we need to be in a position to apply for the needed project financing and to meet our bench marks in the escrow. In order to file for the Tax - Exempt Bonds at the required deadline of July 22n we must have met our threshold requirements of approval of all discretionary hearings for entitlements and a financing commitment from the Agency. Considering the process we must complete in order to meet both of the thresholds we are becoming limited in our flexibility in the schedule to perform all of the tasks on time. The project is becoming very time sensitive and we want to be sure all are informed on the schedule. 3. Financial Analysis of 43 Units vs. 33 Units; the financial analysis of a 33 unit project reflects a per unit subsidy requirement of $201,000 per unit or assistance of approximately $6,550,000. The efficiency of the development of the 33 units decreases significantly since so many of the costs are fixed or are minimum expenditures such as ARCADIA CAMPUS COMMONS SENIOR APARTMENTS land, relocation, legal, architecture and engineering, construction general requirements, legal (bonds), parking structure, elevator, community room, pool, just to name a few. The lender and investor pool begin rejecting projects even the size of the 43 units. The investors and lenders have more projects to select from than they have funds to lend or invest and have less time to devote to underwriting a project. If they can do a 74 unit for the same effort rather than two 37 unit projects, they will. We have input from both California Bank and Trust and Alliant Capital, our affordable housing lender and investor, that they will have significant resistance below the 40 unit mark. Another consideration is that as the amount of cash flow goes down to service the cash residual loan and deferred developer fee, we reach a point where these obligations cannot be retired in the required time period. Meeting these thresholds is required by the tax credit investor (due to IRS requirements) and it does not appear likely we can achieve the needed results based on the cash flow from 33 units servicing the higher cash residual debt per unit. Financial Summary Project Costs Gross Tax Credits Tax Credit Proceeds Permanent Debt 33 Units 43 Units $10,730,875 $12,359,466 $ 3,628,680 $ 4,409,090 $ 2,550,076 $ 3,086,363 $ 1,540,799 $ 2,200,360 4. Density/Design; We believe our proposed density on the project is within the "practical range" for the site as an affordable housing project. The strict limitation on the number of units would create some undesirable results and would do little to change the architectural impact of the project notwithstanding the financial impact. We are providing the following comments as additional input for consideration in the "density" discussion. • The General Plan as adopted is in conflict with the current Density Bonus Ordinance. An appropriate solution would be to leave Council some flexibility in evaluating a particular project rather than an absolute number. • In order to achieve the minimum standard of 33 units we will still need to have three stories of residential units with 14 units per floor. The third floor will only be comprised of five units. The general mass of the building will not change and will not have a positive impact the building's design. • The four -story structure with parking on the ground level is the most cost efficient design and significantly benefits the City as it relates to the required financial contribution. We believe we can reduce our building height 2 ARCADIA CAMPUS COMMONS SENIOR APARTMENTS 3 somewhat without adversely impacting the appearance of the building. Mentioned in the Study Session was a comparable building height project, the 24 Hour Fitness facilities on Live Oak. But it should be noted that it is a flat wall with little to break up the mass of the building surface as opposed to windows and balconies on the elevations of the residential building. Apt Market Research February 9, 2010 Mr. Roger Davila DAVILA PROPERTIES LLC 296 White Cap Lane Newport Coast, CA 92657 Mr. Steve Froberg ASHWOOD CONSTRUCTION 5755 E. Kings Canyon Road Fresno, CA 93727 RE: SITE FACTORS —16 CAMPUS, ARCADIA Gentlemen: The data presented in this memorandum reflects research on age- restricted ( "senior ") apartment projects we've conducted dating back to the mid- 1980s. Nearly half of the 50 to 60 market studies we conduct each year involve this specialized segment of the rental market, and our custom database contains nearly 800 senior apartment projects identified and surveyed in the course of 400+ studies performed in California and 21 other states. This memorandum addresses Iocational factors as they relate to affordable senior apartment development proposed at 16 Campus Drive in Arcadia. This 0.53 -acre site is west of the southwest corner of Campus Drive and Santa Anita Avenue, adjoining the playing fields of Arcadia. High. School. "16 CAMPUS" PROPOSED SENIOR APARTMENT SITE The specific focus of this analysis is the potential effects of the adjoining high school on marketability and livability of senior apartments. 151 Kalmus Drive, Suite ) -5A Costa Mesa, CA 92626 (714) 668 -9600 phone (714) 668 -9603 FAX www.aptmarketresearch.com Mr. Roger Davila Mr. Steve Froberg DAVILA PROPERTIES LLC & ASHWOOD CONSTRUCTION February 9, 2010 Page 2 SITING CONSIDERATIONS — SENIOR APARTMENTS The critical factors underlying senior apartment site selection relate to 1) political /financing realities [particularly the need for high "point scoring" for tax credit submittals] and 2) marketability and livability, [including visibility and access as well as proximity to shopping and services]. On both measures, in -fill sites are superior to those that remote or isolated, no matter how otherwise desirable against typical real estate standards. Due to the concerted focus on securing in -fill locations and the need to successfully integrate senior apartments into a variety of neighborhoods /land uses, thoughtful site layout (e.g., driveway configurations and building orientations) as well as sound attenuation has become the industry standard for affordable senior apartment development. "The Perfect Site" Based on evaluating hundreds of senior apartment sites and tracking project performance, we've developed the following checklist of ideal site characteristics for affordable senior apartments: Conversely, problematic ( "bad ") senior apartment sites are those dominated by the following characteristics: The proposed "16 Campus" site has none of the problematic site factors, and scores well on many of the optimal factors, most notably very good proximity to services (including bus transportation, senior center and hospital) [Exhibit 1] and very good visibility /access. Rated on our standard, 1 -10 (10 high) rating scale, we would score the "16 Campus" site at or above "9." OPTIMAL SITE PREREQUISITES FOR SENIOR APARTMENTS • in -fill site next to or near new /newer grocery- anchored shopping center(s) • linear frontage on signalized major arterial with a secondary egress point • traffic counts of 20,000+ vehicles per day on primary frontage • backing to good quality residential • on bus line • in well- regarded, established community with relatively limited other new apartment development • limited terrain differentials • hospital within 3 miles; other shopping /services within 0 to 1 mile • 3 -story product permissible by local zoning /politics Mr. Roger Davila Mr. Steve Froberg DAVILA PROPERTIES LLC & ASHWOOD CONSTRUCTION February 9, 2010 Page 2 SITING CONSIDERATIONS — SENIOR APARTMENTS The critical factors underlying senior apartment site selection relate to 1) political /financing realities [particularly the need for high "point scoring" for tax credit submittals] and 2) marketability and livability, [including visibility and access as well as proximity to shopping and services]. On both measures, in -fill sites are superior to those that remote or isolated, no matter how otherwise desirable against typical real estate standards. Due to the concerted focus on securing in -fill locations and the need to successfully integrate senior apartments into a variety of neighborhoods /land uses, thoughtful site layout (e.g., driveway configurations and building orientations) as well as sound attenuation has become the industry standard for affordable senior apartment development. "The Perfect Site" Based on evaluating hundreds of senior apartment sites and tracking project performance, we've developed the following checklist of ideal site characteristics for affordable senior apartments: Conversely, problematic ( "bad ") senior apartment sites are those dominated by the following characteristics: The proposed "16 Campus" site has none of the problematic site factors, and scores well on many of the optimal factors, most notably very good proximity to services (including bus transportation, senior center and hospital) [Exhibit 1] and very good visibility /access. Rated on our standard, 1 -10 (10 high) rating scale, we would score the "16 Campus" site at or above "9." POOR SITES FOR MARKET RATE SENIOR APARTMENTS • perceived dangerous or threatening neighborhood (graffiti, security bars, poor local reputation) • "buried" (no visibility) • remote or isolated: no major services within a mile • low quality surrounding land uses (e.g., industrial, class C retail such as auto repair, bars) • 2 -story height limitation • extremely hilly terrain Mr. Roger Davila Mr. Steve Froberg DAVILA PROPERTIES LLC & ASHWOOD CONSTRUCTION February 9, 2010 Page 2 SITING CONSIDERATIONS — SENIOR APARTMENTS The critical factors underlying senior apartment site selection relate to 1) political /financing realities [particularly the need for high "point scoring" for tax credit submittals] and 2) marketability and livability, [including visibility and access as well as proximity to shopping and services]. On both measures, in -fill sites are superior to those that remote or isolated, no matter how otherwise desirable against typical real estate standards. Due to the concerted focus on securing in -fill locations and the need to successfully integrate senior apartments into a variety of neighborhoods /land uses, thoughtful site layout (e.g., driveway configurations and building orientations) as well as sound attenuation has become the industry standard for affordable senior apartment development. "The Perfect Site" Based on evaluating hundreds of senior apartment sites and tracking project performance, we've developed the following checklist of ideal site characteristics for affordable senior apartments: Conversely, problematic ( "bad ") senior apartment sites are those dominated by the following characteristics: The proposed "16 Campus" site has none of the problematic site factors, and scores well on many of the optimal factors, most notably very good proximity to services (including bus transportation, senior center and hospital) [Exhibit 1] and very good visibility /access. Rated on our standard, 1 -10 (10 high) rating scale, we would score the "16 Campus" site at or above "9." Mr. Roger Davila Mr. Steve Froberg DAVILA PROPERTIES LLC & ASHWOOD CONSTRUCTION February 9, 2010 Page 3 Effects of Adjacent High School Our database contains 611 existing /under construction senior apartment projects (affordable and /or market rate) in California. Many are located adjacent to or across from schools or other facilities that generate traffic and /or noise (e.g., hospitals, sports parks, transit stations, shopping centers). We contacted on -site managers for a sampling of senior apartment projects built near high schools to compile 1) data on occupancy levels [as a statistical measure of market acceptance] and 2) managers' comments on pro /con effects of school adjacency. We also contacted the manager of the one existing senior tax credit apartment project in Arcadia, Heritage Park at Arcadia, to explore characteristics that may shed Tight on the likely resident profile for the proposed 43- unit affordable tax credit senior project at 16 Campus. (We prepared the market study used to obtain financing for Heritage Park at Arcadia and visited the site several times.) IMPLICATIONS OF HERITAGE PARK AT ARCADIA FOR "16 CAMPUS" Heritage Park at Arcadia is a 53 -unit, six - year -old tax credit senior apartment project [Exhibit 2] on 150 W. Las Tunas Drive, 1.5 miles south of the subject site [Exhibit 3]. It was 100% pre - leased before it opened in September 2004. Heritage Park at Arcadia is currently 100% occupied, with a waiting list of 100 senior households. With turnover averaging just 6% per year (3 units), this translates to a multi -year wait. None (0 %) of the residents of Heritage Park at Arcadia are employed. This suggests that "16 Campus" is likely to have few or no employed seniors among its residents. Consequently, impacts from the morning arrival time at Arcadia High School [prior to the 8:00 a.m. start of Period 1] will be minor, since few or no residents of the adjoining "16 Campus" senior apartment project will be departing for work. Afternoon traffic activity at the high school is likely to be staggered, since some students are likely to remain after the 2:51 p.m. bell for Period 6 to attend sports practices, tutoring, club meetings and other extra - curricular activities. CASE STUDIES: EFFECTS OF HIGH SCHOOL PROXIMITY ON SENIOR APARTMENTS Data compiled on five senior apartment projects built in California reveals that proximity to high schools represents a positive site factor. • Managers praise the structured as well as informal interactions between senior apartment residents and high school students that often transpire.. -- _ • High occupancy levels and extensive interest lists document that high school proximity does not serve as a deterrent to seniors. FountainGlen Temecula I & II, Temecula FountainGlen Temecula is a 346 -unit, market rate senior apartment project built in two phases: Phase I of 244 units in 2001 and Phase II of 102 units in 2005. [Exhibit 4.] The project adjoins Chaparral High School, one of three high schools in the Temecula Valley Unified School District, with approximately 2,250 students. Mr. Roger Davila Mr. Steve Froberg DAVILA PROPERTIES LLC & ASHWOOD CONSTRUCTION February 9, 2010 Page 4 The project's former assistant manager (2006 to 2008) reports that FountainGlen Temecula benefits from its proximity to the high school, which has enabled interaction between senior residents and teenagers. "Seniors attend the games and the high school's drama performances. Some of our residents have grandchildren attending Chaparral High School and they come by after school to visit. The residents also sit outside just to watch the students coming and going. The Honor Society holds a dance each year in our Community Room for our seniors. The residents love the dance and the students are so kind to those in attendance. Our property management has a great relationship with the school administrators and students. [The developer] built Phase II because the location of Phase I was so successful. I would recommend building a senior community in close proximity to a high school for the proven advantages." The Inn at Woodbridge, Irvine The Inn at Woodbridge in Irvine [Exhibit 5], built in 1996, is situated amid a concentration of development that includes a special education school that serves all of Orange County; lighted ball fields; a fire /paramedic station; Boys & Girls Club; and Kaiser Permanente medical office building. [Exhibit 6.] The project is 100% occupied, with a 140 -name waiting list (2- to 4 -year wait). The resident manager reports no negative impacts from the intense array of nearby land uses: "My seniors love being 'in the middle of the action,' and never complain about noise or traffic. Many especially enjoy proximity to the fire trucks and wave or salute to the firemen went they depart for an emergency. We have 140 senior households on the waiting list for our income - restricted apartments." Mr. Roger Davila Mr. Steve Froberg DAVILA PROPERTIES LLC & ASHWOOD CONSTRUCTION February 9, 2010 Page 5 Casa Grande, Petaluma The benefits of inter - generational interaction were voiced by the manager of a new affordable senior project in Petaluma, "Casa Grande," [Exhibit 7] which is directly across the street from that city's high school in Sonoma County. [Exhibit 8.] This 57 -unit project was built in 2008. It is 100% occupied, with a waiting list. "We have formed a relationship with the Intergenerational Class at Casa Grande High School and the students do their volunteer hours here helping the residents. The students teach line dancing and have gatherings where students and seniors can share experiences, which bring a greater understanding to both groups. Residents sit on their patios and watch soccer games across the street. It is an opportunity for learning, understanding and a greater appreciation for each group. I can't tell you how beneficial it is for the seniors to have contact with these young adults and to see the world through their eyes." Jasmine Square at Founders Village, Fountain Valley Vicki Clark, president of Western Seniors Housing, which provides fee - management services for 20 senior apartment communities in California, actively advocates for co- locating senior apartment communities with schools. "As a property manager, I would strongly support the development of a senior community next to a school. In 2004 we opened a 156 unit senior LIHTC project directly across the street from Fountain Valley High School and have found the relationship between the students and our residents to be a benefit to both. When students have special projects dealing with aging or history, they come over to work with our seniors. The Glee Club choir often sings for our seniors at holidays. Recently, the school agreed to allow our senior Walking Club.to use their track. We have found that our seniors actually like the daily activity of seeing the students come and go — it allows them to feel as though they are still in touch with our youth." The referenced project is located across the street from Fountain Valley High School (student body of 3,245). VIII nslato uunr v CONCLUSION Case study analysis supports our contention that proximity to Arcadia future residents of the planned senior apartment community, and interactions with students. Please call or email with any questions. Sincerely, APT MARKET RESEARCH Annie Gerard, CRE, CAASH Principal Mr. Roger Davila Mr. Steve Froberg DAVILA PROPERTIES LLC & ASHWOOD CONSTRUCTION February 9, 2010 Page 6 J o. y ct a #m,v,,,c Joyce Hummel Principal High School will not negatively affect may well enhance it by facilitating Ara d .,. 16 pa . [Jr,, Arta '" Park & Facilities, Senior Recreation uE e alt 235kla" EXHIBIT 1 Interior Features Project Amenities LEI Air Conditioning ❑ Garages Li Pull Cords 1 Clubhouse 0 Open Spaces Only LI Crafts/Hobbv Room 0 Patio ❑ Security Patrol n Sliders n Full Kitchen m Elevator O Balcony ❑ Carports m Walk -in Closets IU Media Room/TV/VCR • Shuffleboard ❑ Patio/Balcony Storage • I Sprinklered • Lounge • Courtyard • Putting Green Refrigerator ❑ Drapes ❑ Pool • Fitness Center ❑ Gardening Area ❑ Microwave 60% Ei Blinds/Verticals ■Sauna • Spa • Wading Pool n Dishwasher ❑ Multiple Phone Lines • Tennis n Sport Court 0 Scheduled Activities 1 Garbage Disposal M Tub Shower ❑ Tot Lot ❑ Barbecues ❑ On -site Child Care ,. ❑ Greenhouse Window . ` -'- ❑ . - � Shower Stall Cl Leasing Office n Secured Mail • Beauty Shop • Front Screen Door 0 Grab Bars • Business Center ❑ Car Wash • Common Storage • Ceiling Fan ❑ Washer/Drver Hook -ups • Computer Center 0 Trash Chutes • Fireplace • Washer/Dryer Appliances n Laundry Room ❑ Vaulted Ceiling O Internet Access Other Features: Gas stove Parking Security Comments: Total 54 units, 1 mgt. 100% Preleased. By CO 9/1/2004; 100% occupied 12/1/2004. 48 pkg spaces = 0.91 space/ unit. Age range 62 -95. None work. Date Occ HCV 2phh Imported T'over Wtg list 9/05 100% 1 29= 55% 10% 6% 250 1/10 100% 18 20 =38/0 10% 6/0 100 ❑ Garages 0 Gated Community • Gated Parking 0 Open Spaces Only ri Some open spaces • Subterranean ''J Full Perimeter Fencing ❑ Security Patrol • Street Only 17 Tuckunder Structure • Partial Fencing n Locked Buildings ❑ Carports Parking Extra Charge: 0 Deadbolts • In -Unit Alarm 100% • • Electricity I n Gas Policies Owner Paid Utilities Tenant Paid Utilities Comments: Total 54 units, 1 mgt. 100% Preleased. By CO 9/1/2004; 100% occupied 12/1/2004. 48 pkg spaces = 0.91 space/ unit. Age range 62 -95. None work. Date Occ HCV 2phh Imported T'over Wtg list 9/05 100% 1 29= 55% 10% 6% 250 1/10 100% 18 20 =38/0 10% 6/0 100 Minimum Lease: 6 Mos Security Deposit: $188 Pets Allowed: Yes Pet Deposit: $87.60 be] Water Trash Gas LJ Hot Water ❑ Cable ❑ Water U Hot Water i Cable I • Heating • Trash 0 Heating 1 / 1 291 0 100% • • Electricity I n Gas m Electricity $1.21 Flat 2 / 1 Heritage Park at Arcadia SR TC 150 W Las Tunas Dr Arcadia CA 91007 (626) 821 - 9048 Date: 1/22/2010 Units: 63 Product Type: Tax Credit Year Built: 2004 Age Restricted: 62 Contact : Elevation: 3 Olga Owner: AIG Sun America Mgmt. Co.: USA Multifamily Mgt Comments: Total 54 units, 1 mgt. 100% Preleased. By CO 9/1/2004; 100% occupied 12/1/2004. 48 pkg spaces = 0.91 space/ unit. Age range 62 -95. None work. Date Occ HCV 2phh Imported T'over Wtg list 9/05 100% 1 29= 55% 10% 6% 250 1/10 100% 18 20 =38/0 10% 6/0 100 Floor Plan Description Unit Mix / Vacant % Occupied Monthly Rent %MAI Square Feet Value.Ratio($ /SF)I Flat 1 I 1 161 0 100% $579 50% 582 $0.99 Flat 1 / 1 291 0 100% $703 60% 682 $1.21 Flat 2 / 1 8 / 0 100% $786 60% 861 $0.91 EXHIBIT 2 Project Total: 53/0 100.0% PROPERTY PROFILE Copyright © 2004 Apt Market Research Friday, January 22, 2010 3498 ^ V 0 a. W 2 Q cL 0 w z V / 0 0 -J M CO 2 W E� f ILO ii_J IL] + o9 l I any. euelaaal ,J ( � I , " want' .uaaa 6a>edr �► �`Vlayf oie Ave c is En 7a-- " , �, . t 1 i_ -� w :'n- { =6th A e , tr ' - - 7�j-S:-5th= Ave 1.�_ .h l v 'L I _ � rd - - Sit �le�t� Q I .._- l� `R-7.1611,- ,I 1 , ° » ? Gree n field= A IC �- Ave j t l � I` V f- '� �p 1 �S 1 � =1 A�ie ' � � � C ` , _I' 3 C � L� � -,. _ 1 - [, t CO 0 . L I nta +t A v, no 5 , '6 I a: /A. I .p er �, h. d{ i° = Au: IAA d N c' 5. 1 J + I � � r 3 , 1c 46 i NN, ` IE 3 a � I �t I f ( ff ( t J - ° tea �. .a el " ,w _ .. A. �r HbJI A �_ § ~ - I I� = c co �Veltana VyF "�Vw m Serc►p } i1 - It [rah �, i s �I i1 co Interior Features Project Amenities U Air Conditioning U Pull Cords U Clubhouse Water Trash Gas U Crafts /Hobby Room n Patio n Sliders 0 Full Kitchen 0 Elevator 0 Balcony M Walk -in Closets U Media Room/TV/VCR ❑ Shuffleboard 0 Patio /Balcony Storage 0 Sprinklered M Lounge • Courtyard 0 Putting Green 66 Refrigerator • Drapes 7 Pool O Fitness Center ❑ Gardening Area h Microwave I[ Blinds/Verticals ❑ Sauna Cl Sna • Wadinx Pool LJ Dishwasher ❑ Multiple Phone Lines • Tennis • Snort Court 0 Scheduled Activities 'J Garbage Disposal 0 Tub Shower • Tot Lot • Barbecues • On -site Child Care • Greenhouse Window Project 11 • Shower Stall ' r Leasing Office R Secured Mail • Beauty Shop • Front Screen Door 71 Grab Bars M Business Center • Car Wash • Common Storage • Ceiling Fan • Washer/Dryer Hook -ups ❑ Computer Center MI Trash. Chutes • Fireplace • Washer /Dryer Appliances J Laundry Room • Vaulted Ceiling Ri Internet Access Other Protect Amenities: Other Features: Gas Stove Library, computer ctr Parking Owner Paid Utilities Security Flat ❑ Open Spaces Only ❑ Garages Water Trash Gas 71 Gated Community • Gated Parking R Some open spaces • Subterranean k Hot Water MI Full Perimeter Fencing • Security Patrol ■ I 1 0 Heating • Partial Fencin , • I . ° l :. II' M Carports Parking Extra Charge: $30 0 Deadbolts • In -Unit Alarm $916 - $966 730. $1.25 - $1.32 Flat Policies Owner Paid Utilities Tenant Paid Utilities Flat Minimum Lease: Mo /Mo Security Deposit: $300 Pets Allowed: Yes Pet Deposit: $500 I i Water Trash Gas LJ Hot Water Heating Electricity LJ Cable LJ Water Trash Gas k Hot Water I i Cable MI • • 0 Heating 633 $1.30 - $1.37 Flat • • 0 71 Electricity $916 - $966 730. $1.25 - $1.32 FountainGlen Temecula SR I 27250 Nicolas Rd Temecula CA 92591 (951) 506 -1679 Date: 3/18/2009 Units: 244 Product Type: Market Rate Year Built: 2001 Age Restricted: 65 Renovation: Contact : Elevation: 2 &3 Jackie Ramizez, Tammy Owner: Clarett / Prudential Mgmt. Co.: Clarett Comments: 15 HCV. Rents = 6 or 12 mo lease; MTM + $50 /mo. Premium = 1st fir or pool- corner -view Date 1/1 2/1 2/2 Occ Carport T'over 12/01 $680 -755 $780 -855 $880 - 955 $20 12/02 $700 -800 $830 -880 $880 -955 0 $20 5/03 $725 -800 $830 -925 $880 - 930 96.7% $20 5/05 $770 - 845 $870 - 945 $915 - 965 95.9% $25 6/06 $770 -870 $870 -965 $915 -990 95.9% $30 7/07 $790 -865 $910 -980 $930 -985 99.6% $30 5/08 $795 -870 $915 -985 $935 -990 95.1% $30 34% 3/09 $795 -870 $915 -985 $935 -990 97.5% $30 34% Floor Plan Description Unit Mix / Vacant % Occupied Monthly Rent %MAI Square Feet Value Ratio($ /SF) Flat 1/ 1 1271 0 100% $795 - $845 580 $1.37 - $1.46 Flat 1 / 1 18 / 0 100% $820 - $870 633 $1.30 - $1.37 Flat 2 / 1 461 4 91% $916 - $966 730. $1.25 - $1.32 Flat 2 / 1 12 / 1 92% $935 - $985 735 $1.27 - $1.34 Flat 2 / 2 41 / 1 98% $940 - $990 813 $1.16 - $1.22 Project 11 till: 244 / 6 97.5% EXHIBIT 4 PROPERTY PROFILE Copyright © 2004 Apt Market Research Monday, February 08, 2010 1568 Interior Features Project Amenities L1 Air Conditioning Li Pull Cords Lv1 Clubhouse L1 Crafts/Hobby Room tu Patio 0 Sliders 0 Full Kitchen 5 Elevator C Balcony 0 Walk -in Closets J Media Room/TV/VCR ❑ Shuffleboard ❑ PatioBalcony Storage i Sprinklered • Lounge ❑ .Courtyard • Putting Green ni Refrigerator ❑ Drapes 5 Pool 0 Fitness Center • Gardening Area Microwave 51 Blinds/Verticals • Sauna ,Spa • Wading Pool n Dishwasher • -= Multiple Phone Lines ❑ Tennis ' • Sport Court 0 Scheduled Activities n Garbage Disposal n Tub Shower • Tot Lot 22 Barbecues ❑ On-site Child Care • Greenhouse Window 0 Shower Stall n Leasing Office rg Secured Mail ❑. Beauty Shop ❑ Front Screen Door • Grab Bars tu Business Center • Car Wash • Common Storage • Ceiling Fan MI Washer/Drver Hook -ups • Computer Center 0 Trash Chutes • Fireplace • Washer/Drver Appliances 5 Laundry Room $1.41 • Vaulted Ceiling I Internet Access Other Project Amenities: 181 1 Other Features: Gas Stove fire pit Parking Comments: Minimum Lease: Mo /Mo Security Deposit: $3004400 Pets Allowed: Yes Pet Deposit: $600 Security L Hot Water • Open Spaces Only • Garages ' L l Hot Water 1 Heating 2 Gated Community • Gated Parking n Some open spaces ❑ Subterranean Renovation: Contact : MI Full Perimeter Fencing ❑ Securityyatrol • Street Only fI Tuckunder Structure I Gas • Partial Fencing Ill Locked Buntlines tn Carports Parking Extra Charge: $30 MI Deadbolts • In -Unit Alarm Policies Owner Paid Utilities Tenant Paid Utilities Comments: Minimum Lease: Mo /Mo Security Deposit: $3004400 Pets Allowed: Yes Pet Deposit: $600 ■Water L Hot Water L Cable Li Water L l Hot Water 1 Heating U Cable I Trash • Heating • Trash Renovation: Contact : 6/06 $875 $930 $965 $1030 $1090 $1050 85% $30 Elevation: 2 & 3 Jackie Ramirez. Tammy • Gas • Electricity I Gas m Electricity 3/09 $900 $955 $990 $1075 $1135 $1135 89% $30 Floor Plan Description Unit Mix / Vacant % Occupied Monthly Rent %MAI Square Feet Value Ratio(S/SF)I Flat FountainGlen Temecula SR 1I 27250 Nicolas Rd Comments: MTM+ $50. CO 5/15/05. Stabilized 9/15/06 = 6.5 u /mo Temecula CA 92591 absorption. 2/2, $25 view premium. Use Ph I pool, (951) 506 -1579 Date: 3/18/2009 clubhouse. 2 spas. 5 use HCV. 36% turnover. Need stall Units: 102 Product Type: Market Rate showers, bigger BR sizing. Year Built: 2005 Age Restricted: 55 Date 1/1 1/1 1/1 2/1 2/1 2/2 Occ Carport 3/06 $875 $930 $930 $1030 $1090 $1050 $30 Renovation: Contact : 6/06 $875 $930 $965 $1030 $1090 $1050 85% $30 Elevation: 2 & 3 Jackie Ramirez. Tammy 7/07 $895 $950 $980 $1070 $1130 $1130 96% $30 Owner: Clarett/ Prudential 5/08 $900 $955 $990 $1075 $1135 $1135 91% $30 Mgmt. Co.: Clarett 3/09 $900 $955 $990 $1075 $1135 $1135 89% $30 Floor Plan Description Unit Mix / Vacant % Occupied Monthly Rent %MAI Square Feet Value Ratio(S/SF)I Flat 1 / 1 48 1 5 90% $900 613 $1.47 Flat 1 / 1 6 / 3 50% $955 673 $1.42 Flat 1 / 1 8 / 0 100% $990 700 $1.41 Flat 2 / 1 181 1 94% $1076 783 $1.37 Flat 2 / 1 6 / 0 100% $1135 854 $1.33 Flat 2 / 1.75 16 / 2 88% $1135 - $1160 853 $1.33 = $1.36 Pro jest TT tul: 102 / 11 89.2% EXHIBIT 4 PROPERTY PROFILE Copyright © 2004 Apt Market Research Monday, February 08, 2010 4117 EXHIBIT 4 FountainGlen at Temecula I & H (Senior Market Rate Apartments) Temecula, CA 2010 Gooq(i+.... Imnrfr x!;'101 1 74' tJ 117 f'%40 Y 4' V'l .elev ■ 092 .ft Linda Daniel, Assistant manager & leasing agent 2/2006 - 6/2008 (714) 390 -0929 "Seniors attend the games and the high school's drama performances. Some of our residents have grandchildren attending Chaparral High School and they come by after school to visit. The residents also sit outside just to watch the students coming and going. The Honor Society holds a dance each year in our Community Room for our seniors. The residents love the dance and the students are so kind to those in attendance. Our property management has a great relationship with the school administrators and students. FountainGlen built Phase II because the location of Phase I was so successful. I would recommend building a senior community in close proximity to a high school for the proven advantages." Parking Interior Features Project Amenities LJ Air Conditioning { i Pull Cords Ll Clubhouse L I Crafts/Hobbv Room • Patio • Sliders 0 Full Kitchen • Elevator ❑ Street Only Balcon I Walk -in Closets LJ Media Room/TV/VCR !• Shuffleboard • Putting Green • Patio /Balcony Storage 0 Sprinklered • Lounge ❑ Courtyard • Gas Refrigerator ❑ "Drupes • Pool • Fitness Center ■ Gardening Area • Microwave 5 BlindsNerticals • Sauna • Spa • Wading Pool • Dishwasher • Multiple Phone Ines • ' , , • , , I t , ' I , . 1 '' 0 Garba' a Disposal 0 Tub Shower Flat • Tot Lot • : r , • Greenhouse Window ❑ Shower Stall $661 Leasing Office • Secured Mali ❑ Beauty Shop n Front Screen Door n Grab Bars • Business Center • Car Wash 0 Common Storage • Ceiling Fan ❑ Washer/Drver Hook -ups ❑ Computer Center • Trash Chutes • Fireplace • Washer/Dryer Appliances © Laundry Room ❑ Vaulted Ceiling © Internet Access Other Project Amenities: 480 V Other Features: Electric Stoves 2/ 1 Parking Security l i Water t2 Open Spaces Only • Garages 5 Gated Community • Gated Parking Ti Some open spaces • Subterranean W Full Perimeter Fencing ❑ Security Patrol ❑ Street Only ❑ Tuckunder Structure • Partial Fencing P Locked Buildines ❑ Carports Parking Extra Charge: MI Deadbolts • In -Unit Alarm Policies Owner Paid Utilities Tenant Paid Utilities Minimum Lease: 12 Mos Security Deposit: $200 Pets Allowed: Yes Pet Deposit: $200 l i Water 5 Hot Water Ll Cable • Water LJ Hot Water i l Cable (949) 651 - 8600 Date: 2/8/2010 n Trash • Heating • Trash 0 Heating Year Built: 1996 Age Restricted: 62 complaints. Lighted ball fields, Boys & Girls Club and adjacent Special Ed school - Seniors enjoy the Renovation: Contact : 5 Gas • Electricity • Gas 0 Electricity Date Occ HCV T'over Wtg List Owner: Jamboree /Edison Capital /Eenhoorn 3/07 100% 12 5% Inn at Woodbridge SR TC Osborn /E Yale Loop Comments: 2 yr+ waiting list for 60% units; 4 yr wait for 35 - 50% MAI Irvine CA units. Many tenants installed front screen doors. 15 (949) 651 - 8600 Date: 2/8/2010 couples. Oldest tenant is 98. "Residents enjoy Units: 116 Product Type: Tax Credit abutting fire station; sirens are never a source of Year Built: 1996 Age Restricted: 62 complaints. Lighted ball fields, Boys & Girls Club and adjacent Special Ed school - Seniors enjoy the Renovation: Contact : activity, like being near youth." Elevation: 2 Cathy Bajic Date Occ HCV T'over Wtg List Owner: Jamboree /Edison Capital /Eenhoorn 3/07 100% 12 5% Mgmt. Co.: Eenhoorn Management, Inc ('05) 2/10 100% 23 14% 140 names Floor Plan Description Unit Mix / Vacant % Occupied Monthly Rent %MAI Square Feet Value Ratio(S/SF)I Flat 1 l 1 10 / 0 100% $574 36% 480 $1.20 Flat 1 / 1 10 / 0 100% $661 40% 480 $1.38 Flat 1/1 28l 0 100% $855 60% 480 $1.78 Flat 1 / 1 48 / 0 100% $938 - $1010 60% 480 V $1.95 - $2.10 Fiat 2/ 1 10 / 0 100% $1001 60% 672 $1.49 Flat 2 / 1 101 0 100% $1210 60% 672 $1.80 Project Total: 116 / 0 100.0% EXHIBIT 5 PROPERTY PROFILE Copyright © 2004 Apt Market Research Monday, February 08, 2010 734 EXHIBIT 6 Inn at Woodbridge (Senior LIHTC Apartments) Irvine, CA "Inn at Woodbridge Senior Apartments is surrounded by Marden School for Special Needs children, Windrow Park with lighted ball fields, the Boys and Girls Club of Irvine and a Fire / Paramedic Station. Alton Square Shopping Center, anchored by Ralphs and CVS, within 0.2 mile, is heavily traveled. My seniors love being `in the middle of the action,' and never complain about noise or traffic. Many especially enjoy proximity to the fire trucks and wave or salute to the firemen went they depart for an emergency. We have 140 senior households on the waiting list for our income - restricted apartments." Cathy Bajic, Resident Manager, 2010 (949) 651 -8600 Casa Grande SR TC 400 Casa Grande Rd Comments: .. Pull Cords 58 total; 1 mgt, 44 HUD, 13 4% TC units. 100% Smoke - Petaluma CA 94854 free. 11/10/08 Preleasing started. 1/12/09 CO. 44 HUD & (707) 778 - 0240 Date: 1/20/2010 7 TC units preleased. 2 /2/09 Last 6 TC units occupied. Units: 57 Product Type: Tax Credit HUD units pay $150 -608, average $300. Rooftop solar Year Built: 2008 Age Restricted: 62 powers common lights, elevator, laundry, clubhouse. Date Rent Occ Wtg List T'over 2phh HCV Renovation: Contact : 3/09 $660 100% Yes 2% 5 =9% 5 Elevation: 2 Diane Dorey 1/10 $660 100% Yes 5% 5 =9% 8 Owner: PEP ® Blinds/Verticals Mgmt. Co.: PEP ❑ :Dishwasher Floor Plan Description Unit Mix / Vacant, °% Occupied Monthly Rent %MAI Square Feet Value Ratio($ /SF) Fiat • Tub Shower 11 .75 4410 100% ® Shower Stall 50% 627 0 Front Screen Door Flat In Business Center 1 1 . .76, _ 1 ! -0 100% $660 50% 627 :.- $1.05 interior Features Project Amenities • Air Conditioning .. Pull Cords LJ Clubhouse U Crafts/Hobby Room 5 Patio ® Sliders 0 Full Kitchen 5 Elevator 0 Balcony ❑ Walk-in :Closets, Ll Media Room/TV/VCR ❑ Shuffleboard • Patio /Balcony Storage ® Sprinklered ❑ Lounge 2 Courtyard • Putting Green 5 Refrigerator ❑ Drapes ❑ Pool ❑ Fitness Center 0 Gardening Area • Microwave ® Blinds/Verticals • Sauna • Spa • Wading Pool ❑ :Dishwasher ❑ titultinle Phone Lines ❑ Tennis 5 Sport Court 5 ScheduledActivities 5 Garbage Disposal • Tub Shower • Tot Lot • Barbecues • On- site•C'hild Care ❑ Greenhouse Window. "` ® Shower Stall :Leasing Office Secured Mail ❑ Beauty Shop 0 Front Screen Door 5 Grab Pars In Business Center • Car Wash • Common Storage 5 Ceiling Fan ❑ Washer/Dryer Hook -ups ❑ Computer Center ❑. Trash Chutes • Fireplace • Washer/Dryer Appliances 0 Laundry Room Vaulted Ceiling 14 Internet Access Other Project Amenities: Other Features: Electric stove bocce ball, outdoor fitness station Parking "Security . 2 -Open Spaces Only • Garages' El Gated Comntunity' • Gated Parking PI Some open • Subterranean • Full Perimeter Fencing • Security Patrol ,maces ❑ Street (Into . ` 'Fl T uckunder. Structure 0 Partial F'encin 1 1:Locked Buildings ❑ Carports Parking Extra Charge: J Deadbolts • In -Unit Alarm Policies Owner Paid Utilities Tenant Paid Utilities Minimum Lease: 12 Mos LI Water • Hot Water • Cable U Water U Hot Water U Cable Security Deposit: 1 Mo. Rent Trash Heating Trash 5 • • • Heating Pets Allowed: Yes Gas Electricity Gas • • n 0 Electricity Pet Deposit: $250 EXHIBIT 7 Project Total: 5710 100.0% PROPERTY PROFILE Copyright © 2004 Apt Market Research Monday, February 08, 2010 5262 EXHIBIT 8 Casa Grande (Senior LIHTC Apartments) Petaluma, CA 2 f) 10 C<ogla. a ^;# n,x 36'141'32 13" N 122,35'45`55" W "We have formed a relationship with the Intergenerational Class at Casa Grande High School and the students do their volunteer hours here helping the residents. The students teach line dancing and have gatherings where students and seniors can share experiences, which bring a greater understanding to both groups. Residents sit on their patios and watch soccer games across the street. It is an opportunity for learning, understanding and a greater appreciation for each group. I can't tell you how beneficial it is for the seniors to have contact with these young adults and to see the world through their eyes." Diane Dorey, Resident Manager (707) 778 -0240 We cover: PROFESSIONAL QUALIFICATIONS Apt Market Research OVERVIEW Apt Market Research of Costa Mesa (Orange County), California, provides top quality market studies and consulting for all types of apartment projects. Partners Annie Gerard and Joyce Hummel analyze new construction and acquisition /rehab opportunities for market rate & affordable senior apartments, conventional rental properties, "family" tax credit, in -fill, and Title 2 preservation deals in markets across the country. Senior (55 +) apartments have been a specialty since the mid 1980s, now accounting for approximately half of our workload. WHAT WE DO Apt Market Research provides market studies and consulting services to developers, lenders and agencies on all types of apartment projects: • senior- partment _— • affordable housing (tax credit, Bond) • midline and luxury apartments • in -fill projects • preservation • historic • acquisition /rehab as-well as new construction • market rate as well as affordable: • general occupancyf'family" as well as senior /55+ (age- restricted) We can supply market research /consulting at any point in the development process: • prior to site acquisition /control (a "green light analysis before commitment) • when applying for approvals (to assure cities that a project is viable) • before starting detailed design work (so your architect can design a project with hard data on unit mix, sizing and a thousand other product considerations) • in conjunction with seeking financing (to satisfy lenders' requirements on market depth and market feasibility) Apt Market Research 151 Kalmus Drive, Suite J -5A Costa Mesa, CA 92626 714/668 -9600 www.aptmarketresearch.com PROFESSIONAL QUALIFICATIONS Apt Market Research Specific services provided by Apt Market Research include: • full lender market studies • "go /no go" recommendations & due diligence research • detailed product & pricing recommendations for use in the project pro forma and design stages • Low Income Housing Tax Credit [LIHTC] market studies for state agencies, syndicators and • investors • repositioning & turnaround analyses of troubled properties • regional market assessments & identification of geographic opportunities WHAT WE'RE KNOWN FOR We're nationally recognized for the pioneering research we've done on senior (age- restricted) apartments. The studies we do today draw on extensive post- occupancy analysis, project tracking and consumer research dating back to the mid 1980s. Our custom database covers detailed information on more than 500 senior apartment projects — including unit mix, sizing, features /amenities, parking ratios and costs, tenant profiles, rent trending, absorption history, concessions, premiums, policies and nearly 100 other data fields. We're proud of our reputation for superior. and analysis. We don't just analyze whether a project will work or not. We provide clear, detailed, - actionable product and positioning recommendations to make projects work even better. That includes exhaustively researching pending /proposed competitive supply, to evaluate what the effects of other new apartment communities may be. WHAT WE CAN HELP PREVENT Good market research early in the process can save a lot of expense and time at a fraction of the cost of the deal. (Many studies we do cost far less than $50 per door.) Don't let any of these pitfalls we've seen caused by no or shoddy market research happen to you: • Learning only after you've already invested $100,000 in a deal that achievable rents are hundreds of dollars lower than pro forma rents. • Building too -small or improperly amenitized units in a submarket that demands bigger, better product — and then paying the price in slow lease -up and higher carrying costs. Apt Market Research 151 Kaimus Drive, Suite J -5A Costa Mesa, CA 92626 714/668 -9600 www. aptmarketresearch. com PROFESSIONAL QUALIFICATIONS Apt Market Research • Having your out -of -town, prospective lender literally drive past "key comps" that weren't addressed in the market study on the way to the site, raising questions about the validity of the study (and even the project itself). • Learning only after you're under construction that four other new projects have also broken ground — all in better locations and with better product than you're offering. GEOGRAPHIC AREAS OF FOCUS We handle assignments in urban, suburban and rural markets throughout the southwestern United States, and consider the entire state of California as "being in our backyard." Visiting 40 -60 different submarkets each year provides valuable perspective well beyond the "local market" level, including: • the best (and worst) new product & marketing techniques • data on markets that are over -built or pent -up • how resident profiles and other demographic factors are changing tenants' product desires • which property management companies stand out or fall short OUR DATABASE Apt Market Research's custom database currently contains nearly 4,000 apartment communities totaling 500,000+ units. We add new projects with each new assignment and update projects already in the . database, preserving "same store ". rent trending. Approximately 500 of the 4,000 properties are senior apartment communities. Many of them are projects we did the market feasibility for, including the following brands: Seasons, Vintage, Carefree, Horizons, FountainGlen, Victoria Woods. OUR REPUTATION ✓ We're the market research company lenders make referrals to. ✓ We're the market research company hired to tear apart and re -do faulty market studies. ✓ We're the market research company developers and lenders come to when projects are challenging, pioneering, potentially high risk, or high profile. Apt Market Research 151 Kalmus Drive, Suite J -5A Costa Mesa, CA 92626 714/668 -9600 www.aptmarketresearch.com OUR CLIENTS Ongoing and /or recent clients include: PROFESSIONAL QUALIFICATIONS Apt Market Research • The Related Companies of California • BRIDGE Housing • USA Properties Fund • Chelsea Investments • Foundation for Social Resources • Irvine Apartment Communities [IAC] • Meta Housing • MacFarlane Costa Housing Partners (formerly Simpson Housing Solutions) • National CORE • Triumph Management • Urban Housing Communities, LLC • C.J. Segerstrom & Sons • Eagle Real Estate Group • R.C. Hobbs Company • Western Community Housing • Lucas Communities • Diocese of San Bernardino • Regal Development Group RESEARCH BASIS Every study is prepared by an analyst with 25+ years experience: Were intentionally structured along team lines, to take full advantage of analysts' varying backgrounds (development, planning, finance and economics) and to pool over 50 years of experience analyzing real estate developments. Concentrating on apartments and only apartments lets us stay in front of the newest trends. We produced more than 450 studies between 1998 and 2004, in 108 different California submarkets and 25 other states. The total valuation of projects we worked on during that timeframe that are now either completed or under construction exceeds $2.5 billion dollars. Data is always compiled from the ground up. Rather than relying on Internet searches or someone else's canned database, we identify and physically audit projects that are truly comparable. We've found there's no good substitute for physically spending time in a given submarket, getting a grasp of local issues and characteristics (not just project data) — and learning insider information from on -site leasing and management people that they would never divulge in a telephone inquiry. Apt Market Research 151 Kalmus Drive, Suite J -5A Costa Mesa, CA 92626 714/668 -9600 www.aptmarketresearch.com PROFESSIONAL QUALIFICATIONS Apt Market Research WHAT WE DON'T DO • We're strictly a third -party research house. We don't engage in brokerage or development. We never trade research in exchange for a "piece of the deal," and never accept finder's fees. • We don't do appraisals. • We don't take on assignments outside our particular expertise (e.g., Assisted Living or for -sale senior housing). HISTORY OF THE FIRM After nearly seven years at Eliant (formerly National Survey Systems), Annie Gerard and Joyce Hummel started Apt Market Research in December 2004. Eliant allowed us to take with us the custom database we'd built; originals and electronic files for all studies and consulting assignments we'd done while at Eliant; and all other records and back -up material relating to Eliant's Apartment Research Division, formed in 1998. CONTACT INFORMATION Annie Gerard: 714/668 -9600 x 222 ; agerard @aptmarketresearch.com Joyce Hummel: 714/668 -9600 x 111; jhummel @aptmarketresearch.com Apt Market Research 151 Kalmus Drive, Suite J -5A Costa Mesa, CA 92626 714/668 -9600 www.aptmarketresearch.com 7 ❑I— N 0 V, E = 2 2 V) CI) � � o U U Y ... Y a. 0. U U- 0 1 • 3 0, CL a 0 E 0, a Research By Paul Ernrath, Ph.D Live Longer, Drive Less: How Aye Affects Vehicle Use H ousehold vehicle use is some- thing developers and local policymakers both are likely to consider when planning a new community. Parking and roads need to be adequate to accommodate cars and traffic, but not so plentiful that they lead to reduced space for landscaping or greater and costs for each housing unit. A number of standard measures suggest that the impact of vehicles per housing unit should be lower if residents are older. After about age 45, the number of persons per household generally declines with advancing age, implying that a 50+ housing ._unit wilt generally place lower demands on local infrastructure. Data the Census Bureau's most recent (2006) American Community Survey show that a household age 35 -54 in a single - family detached home will own, on average, 2.3 vehicles — compared to only 1.4 for a household age 75 +. According to the latest (2003) Trip Generation report from the Institute of Transportation Engineers, an average single - family home generates 9.6 vehicle trips per weekday — compared to 3.7 for the category Trip Generation identifies as "seniors' single - family." If road capacity is the main issue, the most relevant variable probably is the number of trips generated during peak hours of road use. Because older Ameri- cans are more likely to be retired, they can time their travel to avoid work - related congestion, so 50+ housing tends to score rather well. Trip Generation shows that an average single - family home generates 48 150+ HOUSING MAGAZINE • Fall 2006 1.01 vehicle trips during the evening rush hour (the hour of peak traffic on adjacent streets between 4:00 and 6:00 p.m.) — compared to only 0.26 for a seniors' single - family residence. Recently, local policymakers concerned about climate change have shifted their focus more toward the total miles vehicles are traveling. This has led NAHB's Housing Policy Department to develop a statistical model that estimates total vehicle miles traveled (VMT) per year fora particular residential subdivision. The model is based on data from the most recent (2001) National Household Travel Survey (NHTS),' which collects detailed information on all vehicle travel undertaken by a nationally representa- tive sample of households, and is conducted by the Federal Highway Administration. The NAHB model controls for all the household and housing unit characteris- tics in the NHTS -based travel forecasting models of the Department of Transporta- tion, the Environmental Protection Agency, and the Department of Energy. The NAHB model also seeks to use all the location information available in the data. The NHTS data don't identify individual states, but do indicate the four principal Census regions. The data also indicate whether a household is in a Metropolitan Statistical Area (MSA) — an urban area — and provide some information about the metro area's population and whether or not it has a rail transportation system. But the NHTS data don't identify individual metro- politan areas specifically, nor provide any more precise information about how close the transportation system comes to a particular home. Based on the results of the model, we are able to predict that, holding all else constant, a residential subdivision will generate more VMT if it is in • a rural area • outside of a metropolitan area • in a metropolitan area that lacks rail transport • the South (and less, if in the Northeast). Results from the model also indicate that a residential subdivision will generate more VMT if the households occupying the homes • are homeowners • are larger (with more persons per household) • contain more workers. • have higher incomes • are less educated • have a male householder • are white • are Hispanic • are younger. The model further predicts that more VMT will be generated from single - family homes than from multifamily, and from subdivisions that have fewer housing units per acre. From the perspective of 50+ housing, the relationship between age of the house- holds and VMT is of particular interest. Figure 1 shows the estimated annual VMT generated by a household in hypothetical subdivision in an urban location within a Southern metropolitan area with a 'For details of the methodology employed, see "Vehicle CO Emissions and the Compactness of Residential Development" by Helen Fei Liu in Housing Economics, December 2007: http:// www. nahb .org /generic.aspx ?sectionlD= 734 &genericContentlD = 86266 &channelID =311 www.50plushousingmagazine.com Research under 35 35t054 55 to 64 65 to 74 75 and older O population of between one and three million and a rail transport system. The figure also shows how the estimates change if age of the household head changes, holding all other household characteristics constant at national averages. We see that the estimated number of vehicle miles traveled declines as the subdi- vision's occupants grow older, A household in the subdivision generates a bit more than 26,000 VMT per year if the head of the household is younger than 35, a little less than 23,000 if 75 or older. Figure 1 captures a pure age effect. But older households tend to be smaller, and are more likely to be retired, so Figure 1 doesn't show all the differences in vehicle use that are likely to emerge among house- holds of different ages. Figure 2 shows-what happens if we assume that household size and number of workers per household are set to the averages for a specific category shown in the figure. For example, VMT for a single family home owner age 55 to 64 in Figure Figure 1, Annual VMT per Household by Age Persons & Workers per Household Held ::crns13n1 i /21420111L, idily yell 26,436 23,494 25,333 22,391 24,589 tJ 21,472 23,976 20,859 22,873 19,756 0 5000 10000 15000 20000 25000 30000 Single - Family Owner Nil Multifamily Renter For an urban subdivision with 1.6 -4.7 housing units per acre, in a metro- politan area in the South with a population of 1 -3 million and a rail transport system; household characteristics set to national averages. Source: Estimates from NAHB model based on data from the 2001 National Household Travel Survey, Federal Highway Administration. 50 1 50+ HOUSING MAGAZINE • Fall 2008 es .h • , 2 is estimated assuming that the number of persons and workers in the households are average for home owners age 55 to 64. Unsurprisingly, allowing household size and number of workers to vary with age produces substantially larger differ- ences in estimated VMT. Under these assumptions, a single - family home owner in the hypothetical subdivision gener- ates nearly 29,0900 VMT per year if the head is younger than 35, but only about 12,000 if the head is 75 or older. Figure 2 also captures the differences in household size and workers per household that tend to exist between multifamily renters and single - family homeowners. Allowing for these differences, the model estimates that a 75 -plus multifamily renter would _generate fewer than 8,000 VMT per year. In summary, Figure 1 shows differences in VMT if age is the only characteristic that varies. Figure 2 shows the differences if household size and workers in the house- hold are allowed to vary with age. Other characteristics also may vary with age, of under 35 35 tO 54 55 to 64 65 to 74 75 and older Figure 2. Annual VMT per Household by Age, Allowing for Differences in Persons /Workers per Household ;k course, but the differences in household size and employment are particularly well known and understood. Using the same data, NAHB has created similar models for other travel - related variables — vehicle efficiency, efficiency of the speed vehicles are driven (the differ- ence from a theoretically - optimal 45 mph), and gallons of gasoline consumed. The results show that, controlling for the other variables, older households tend to own slightly less efficient vehicles, and to drive at slightly less efficient speeds. Although statistically significant, these age- efficiency effects are relatively small. On balance, older households use less gasoline per year, and the patterns of gasoline consumption by age look similar to the patterns of VMT by age shown in figures 1 -and 2. More'cbmplete results are available from the NAHB Housing Policy Department. Interested readers may contact Helen Fei Liu (800- 368 -5242 x8488, fliu @nahb.com) for more information. so+ 14,845 15,383 ?..k'l') 10,220 12,012 7,679 21,687 i 19,200 21,254 28,767 27,757 5000 10000 15000 20000 25000 30000 Kt Single - Family Owner n Multifamily Renter For an urban subdivision with 1.6 -4.7 housing units per acre, in a metropolitan area in the South with a population of 1 -3 million and a rail transport system; persons & workers set to national average by age bracker; other household characteristics set to overall national averages. Source: Estimates from NAHB model based on data from the 2001 National Household Travel Survey, Federal Highway Administration. www.50plushousingmagazine.com Table of Agency Low/Mod Housing Funds Agency Low /Mod Housing Funds - Projections and Available for Senior Housing Loan Repayment - Loan Repayment - 2010 - 2011 2014 - 2016 Period 1 2001 -2002 $ 522,100 $ 522,100 2002 -2003 $ 648,727 $ 648,727 2003 -2004 $ 812,894 $ 812,894 2004 -2005 $ 833,331 $ 833,331 2005 -2006 $ 758,525 $ 758,525 2006 -2007 $ 779,031 $ 779,031 2007 -2008 $ 821,753 $ 821,753 2008 -2009 $ 870,356 $ 870,356 2009 -2010 $ 888,000 $ 888,000 2010 -2011 $ 906,000 $ 4,951,715 2011 -2012 $ 924,000 $ 924,000 2012 -2013 $ 942,000 $ 942,000 2013 -2014 $ 961,000 $ 961,000 2014 -2015 $ 1,980,000 $ 980,000 Total $ 12,647,717 $ 15,693,432 34% Percentage Available 34% for Age Restricted $ 4,300,224 $ 5,335,767 (Less) Assistance for $ 1,800,000 Heritage Park Project $ 1,800,000 $ 2,500,224 Net Available Funds $ 3,535,767 Period 2 For Age Restriced Projects 2015 -2016 $ 4,045,315 $ 999,600 2016 -2017 $ 1,019,592 $ 1,019,592. 201.7 -2018 $ ..- - 1,039,984 $ 1,039,984 2018 -2019 $ 1,060,784 $ 1,060,784. 2019 -2020 $ 1,081,999 $ 1,081,999 2020 -2021 $ 1,103,639 $ 1,103,639 2021 -2022 $ 1,125,712 $ 1,125,712 2022 -2023 $ 1,148,226 $ 1,148,226 2023 -2024 $ 1,171,191 $ 1,171,191 2024 -2025 $ 1,194,615 $ 1,194,615 Total $ 13,991,057 $ 10,945,342 34% 34% $ 4,756,959 Available for Age $ 3,721,416 Restricted Projects Period 3 2025 -2026 $ 1,218,507 $ 1,218,507 2026 -2027 $ 1,242,877 $ 1,242,877 Total $ 2,461,384 $ 2,461,384 34% 34% $ 836,871 Available for Age $ 836,871 Restricted Projects Grand Total $ 8,094,054 $ 8,094,054 Assumption - 2% Annual Increase Information Provided by Keyser Marston Associates, Inc.