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EXHIBIT 3 <br />Judson Brown, City of Santa Ana January 9, 2019 <br />Francis Xavier Residence: Preliminary Financial Gap Analysis Page 2 <br />EXECUTIVE SUMMARY <br />Estimated Financial Gap <br />The results of the KMA financial gap analysis are compared to the Developer's financial <br />proposal in the following table: <br />KMA Developer Difference <br />Total Construction Costs $4,195,000 $4,234,000 ($39,000) <br />Outside Funding Sources 3,164,000 3,164,000 -0- <br />Financial Gap $1,031,000 $1,070,000 ($39,000) <br />As shown in the preceding table, KMA estimates the Project's financial gap at $1.03 <br />million. Comparatively, the Developer is requesting $1.07 million in financial assistance <br />from the Authority. This represents an approximately 1% differential which can be <br />considered inconsequential. However, it is important to note that the KMA and <br />Developer estimates differ on a line item by line item basis. <br />Proposed Funding Sources <br />The following summarizes the proposed funding sources for the Project: <br />1. The Project's stabilized net operating income (NOI) supports a $449,000 <br />conventional permanent loan. The NO1 includes the rental subsidy generated by <br />the following: <br />a. Three (3) VASH Vouchers awarded to the Project by the Authority; and <br />b. A Capitalized Operating Subsidy Reserve (COSR) for nine units awarded <br />by the California Department of Housing and Community Development <br />(HCD) through the No Place Like Home Program (NPLH). <br />2. The Developer is proposing to apply for a $2.35 million loan of NPLH funds <br />awarded by HCD. <br />1901007:SA:TRB <br />19090.017.010 <br />3-19 <br />