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Loan Agreement for WISEPlace Permanent Supportive Housing <br />March 7, 2023 <br />Page 3 <br />3 <br />2 <br />8 <br />1 <br />•Disbursement Schedule: <br />o One hundred percent (100%) (up to $4 million) of the Construction <br />Component of the City/HOME-ARP Loan proceeds will be disbursed by City <br />to Developer after execution and recording of the Agreement. <br />o One hundred percent (100%) of the HOME-ARP Subsidy Reserve <br />Component will be disbursed to the Developer after completion of <br />construction of the Project and issuance of a Certificate of Completion. <br />•Selection of Tenants: North Broadway Housing Partners LP shall give <br />preference in leasing units to households who qualify as chronically homeless <br />that live in the City of Santa Ana. <br />The Loan Agreement has been signed by Jamboree Housing Corporation on behalf of <br />North Broadway Housing Partners LP to acknowledge their acceptance of the terms. <br /> <br />Subordination Agreements <br />The City’s loan is $5,256,327 compared to Bank of America’s larger construction loan of <br />approximately $16 million (the exact amount of Bank of America’s loan will be <br />determined at construction loan closing). It is standard practice for a private market <br />senior lender to request a Subordination Agreement for the City’s smaller loan in order <br />to permit the senior lender to complete their underwriting and commit their private <br />market financing. The Subordination Agreement will ensure the senior lender will be <br />paid back before the City’s loan (attached as Exhibit 4). <br />The City’s loan for $5,256,327 is larger than the County’s junior loan for $1,500,000; <br />therefore, the City is seeking to subordinate the County’s junior loan (attached as <br />Exhibit 5). <br />The City’s total loan for $5,256,327 is larger than the Orange County Housing Finance <br />Trust (OCHFT) junior loan for $2,480,030; therefore, the City is seeking to subordinate <br />the OCHFT’s junior loan (attached as Exhibit 6). <br />Staff will not know if another Subordination Agreement is required until after the Project <br />is complete. However, given the various sources of financing and structure of the loans <br />for this Project, staff is seeking approval to authorize the City Manager to enter into any <br />future Subordination Agreement if one is required for the permanent loan closing of the <br />Project. <br />Project Description <br />To preserve the landmark status of the existing building the project consists of the <br />adaptive reuse of the one-story east-west wing of WISEPlace facing Broadway Street. <br />The existing north-south wing facing Sycamore Street will be demolished to <br />accommodate the new construction of a four-story building, with a podium-parking <br />garage on the ground floor and three levels of wood frame construction above. The <br />building architecture is complementary to the existing building’s Spanish Colonial <br />Revival style, while being differentiated and distinguishable from the existing <br />architecture. The sight lines along Broadway Street are preserved to maintain the