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Pre -Commitment of Affordable Housing Funds and a Ground Lease to Related Companies July 2, 2019 Page 6 The pre -loan commitment letter with The Related Companies of California with A Community of Friends as the service provider for $3,971,440 in affordable housing funds consisting of $963,951 in Neighborhood Stabilization Program funds and $3,007,489 in HOME Investment Partnerships Program funds, and a sixty-two (62) year ground -lease of 1126 E. Washington Ave, for the development of the Crossroads at Washington affordable housing project located at 1126 and 1146 E. Washington Ave, Santa Ana, CA 92701, (APNs 398-092-13 and 398-092-14) provides the enforceable funding commitment from the City (Exhibit 1). Among various other conditions, the pre - commitment letter is conditional on the developer securing any and all permits and discretionary approvals that may be required for the Project by the City, Housing Authority, and County. The pre - commitment does not not obligate the City or any department thereof to approve any application or request for or take any other action in connection with any planning approval, permit or other action necessary for the construction of the project. In compliance with the City's Affordable Housing Funds Policies and Procedures, KMA has conducted a preliminary financial gap analysis to confirm the underwriting for the Crossroads at Washington, the financial gap, and other programmatic requirements related to the funding sources (Exhibit 2). KMA reviewed the developer's estimates and projections of rents, expenses, reserves and development costs in accordance with industry -standard underwriting guidelines. Following this gap analysis and the procurement and deliberative process described above, staff recommends the full amount of the award to the City Council / Housing Authority for final approval. Project Description Following the competitive multi -stage Request for Proposal (RFP) process that included an extensive RFP response, supplemental proposals, presentations and two interviews, The Related Companies of California ("Related") in partnership with A Community of Friends ("ACOF") is being recommended by the City of Santa Ana staff as the developers to co -develop an affordable housing community on the 1126 & 1146 E. Washington Avenue site (the Project) that was part of the City of Santa Ana RFP # 18-056. The proposed name for the project is the Crossroads at Washington. Drawing from more than 60 years of combined experience in the successful development and ongoing property management of affordable and supportive housing communities, Related and ACOF are ideally suited to collaborate on the Washington Avenue Site with the City of Santa Ana to develop an enriched, transit -oriented community that will support housing for extremely low income families and special needs populations in the City of Santa Ana. The collaboration between Related and ACOF brings complementary experiences in developing, building, and managing housing for families and special needs populations; success in competing and receiving local, state, federal, and private financing; and experience from the development of a large portfolio of award -winning affordable housing developments. All these benefits ensures the greatest results for the residents and surrounding community. As an experienced developer, Related draws on both their market rate and affordable communities to produce their award -winning housing developments. Related has completed over 11,000 units of top-quality affordable and mixed income multifamily rental housing throughout California since its inception in 1989. Over the course of 30 years, Related has partnered with over 25 community- 1 E .,