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EXHIBIT 2
<br />$23,000,000 conventional construction loan;
<br />b. 3.62% interest rate;
<br />C. A 24 -month development period; and
<br />d. An average outstanding balance of 59%.
<br />3. The financing costs are estimated at $438,000, and includes the following:
<br />4. A three month capitalized operating reserve will be provided. However, no transitional
<br />reserve is required by Union Bank, the lender.
<br />The total financing costs are estimated at $2,029,000, which KMA finds to be reasonable and
<br />necessary to complete the Project. As the Project moves through the development process, the
<br />City is required to keep up to date with any changes to the costs.
<br />Tota/ Estimated Development Costs
<br />The total estimated development costs are $29,355,000, or $386,250 per unit. Based on the
<br />analysis above, KMA finds Developer's cost estimates to be reasonable and necessary in order
<br />to construct, lease -up and complete the Project. As the Project moves through the
<br />development process, the City needs to keep track of the changes to the costs, if any.
<br />B. Stabilized Net Operating Income (Table 2)
<br />The Project's proposed funding sources include HOME Program funds, low income housing tax
<br />credits (Tax Credits), Special Needs Housing Program (SNHP), and other funds. Income limits
<br />are published for households that are qualified to reside in units that have received assistance
<br />from these sources.
<br />The HOME Program publishes rent standards for projects receiving assistance from HOME
<br />funds. Tax Credit and SNHP program also publishes rent standards. Developer will be required
<br />to adhere to the strictest of the standards imposed by the funding sources.
<br />The HOME affordability requirements will remain in place for 55 years, which is above the 20
<br />year minimum period that the HOME Program requires. Therefore, the Project will exceed the
<br />minimum HOME Program requirements.
<br />City of Santa Ana Underwriting & Subsidy Layering Review: Veteran's Village Page 16
<br />25L-16
<br />Financing Fees
<br />Points
<br />Acquisition Loan
<br />$6,000
<br />0.13
<br />Construction Loan
<br />$150,000
<br />0.65
<br />Permanent Loan
<br />$118,000
<br />1.21
<br />SNHP Loan
<br />$29,000
<br />1.00
<br />TCAC
<br />$135,000
<br />1.05
<br />4. A three month capitalized operating reserve will be provided. However, no transitional
<br />reserve is required by Union Bank, the lender.
<br />The total financing costs are estimated at $2,029,000, which KMA finds to be reasonable and
<br />necessary to complete the Project. As the Project moves through the development process, the
<br />City is required to keep up to date with any changes to the costs.
<br />Tota/ Estimated Development Costs
<br />The total estimated development costs are $29,355,000, or $386,250 per unit. Based on the
<br />analysis above, KMA finds Developer's cost estimates to be reasonable and necessary in order
<br />to construct, lease -up and complete the Project. As the Project moves through the
<br />development process, the City needs to keep track of the changes to the costs, if any.
<br />B. Stabilized Net Operating Income (Table 2)
<br />The Project's proposed funding sources include HOME Program funds, low income housing tax
<br />credits (Tax Credits), Special Needs Housing Program (SNHP), and other funds. Income limits
<br />are published for households that are qualified to reside in units that have received assistance
<br />from these sources.
<br />The HOME Program publishes rent standards for projects receiving assistance from HOME
<br />funds. Tax Credit and SNHP program also publishes rent standards. Developer will be required
<br />to adhere to the strictest of the standards imposed by the funding sources.
<br />The HOME affordability requirements will remain in place for 55 years, which is above the 20
<br />year minimum period that the HOME Program requires. Therefore, the Project will exceed the
<br />minimum HOME Program requirements.
<br />City of Santa Ana Underwriting & Subsidy Layering Review: Veteran's Village Page 16
<br />25L-16
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