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Community Development Agency <br />santa-ana.org/community-development <br />Item # 16 <br />City of Santa Ana <br />20 Civic Center Plaza, Santa Ana, CA 92701 <br /> Staff Report <br />January 16, 2024 <br />TOPIC: First Amendment to Density Bonus Housing Agreement for Legacy Square <br />AGENDA TITLE <br />First Amendment to the Density Bonus Housing Agreement for Legacy Square <br />RECOMMENDED ACTION <br />Approve a First Amendment to the Density Bonus Housing Agreement with National <br />Community Renaissance of California and Legacy Square, L.P. for the permanent loan <br />conversion of Legacy Square (Agreement No. A-2024-XXX). <br />GOVERNMENT CODE §84308 APPLIES: Yes <br />DISCUSSION <br />On February 5, 2019, the City Council authorized the City Manager to execute a Density <br />Bonus Housing Agreement with National Community Renaissance of California <br />(“National CORE”) for the development of a 93-unit affordable housing development at <br />609 N. Spurgeon Street (“Legacy Square”) (Agreement No. A-2019-028). Legacy <br />Square was completed on April 29, 2023 and without the density bonuses, National <br />CORE would only have been permitted to build 51 units of affordable housing. <br />The First Amendment to the Density Bonus Housing Agreement is required for the <br />permanent loan conversion for National CORE and Legacy Square, L.P. A permanent <br />loan conversion for a multifamily affordable housing project refers to the transition from <br />a construction loan financing to a long-term, permanent mortgage loan once the <br />construction of the project is complete. The permanent loan will have terms and interest <br />rates appropriate for the long-term nature of the financing. However, the terms can vary <br />based on the agreement between the developer and one or more lenders. The <br />conversion from construction financing to permanent financing allows the project to <br />transition from the development phase to stable, long-term operations while meeting the <br />affordability goals set for the housing units. The specific details of the permanent loan <br />conversion process can vary depending on the project, financing arrangements, and <br />regulatory requirements.