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Committee approves tax‑incentive review and sets hearing for Northridge 'The Reserve' after Baker Tilly analysis recommends reduced term
Summary
The Committee of the Whole voted to advance a tax incentive application from Northridge Construction for a 155‑unit multifamily project called The Reserve. Baker Tilly's financial review found the project—estimated at $37 million—needs a property tax exemption to meet lender coverage and yield a reasonable investor return; the consultant recomme
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The Committee of the Whole voted to advance Northridge Construction's request for financial assistance for a proposed 155‑unit multifamily project ("The Reserve") and to set the application for further review and public hearings after a preliminary Baker Tilly analysis.
Baker Tilly analyst Mikaela Hewitt told the committee the proposed mixed‑unit project — roughly 155 units with underground and surface parking — carries an estimated total development cost of about $37 million. The financial pro forma provided by the applicant showed a 70% debt / 30% equity financing structure in the application materials and a projected operating pro forma that, without tax relief, leaves insufficient net operating income to meet typical lender debt‑coverage requirements (1.3x) and would produce negative cash flow for equity investors.
Based on the analysis, Baker Tilly recommended a reduced incentive compared with the applicant's request: rather than 20 years at 100%, the consultant recommended a 15‑year phased exemption with the first 5 years at 100%, years 6–10 at 80% and years 11–15 at 60% (a blended 80% over 15 years). The change aims to provide earlier coverage to meet debt requirements while reducing the total long‑term tax exemption.
The committee moved the application forward for additional review and scheduled the public hearing process; a motion to advance the application passed by a 6‑1 margin with Council Member Osofsky recording dissent.
