St. Paul HRA to reserve about $10.05 million for six affordable housing projects ahead of state RFP

St. Paul Housing and Redevelopment Authority staff presented a proposal to reserve a combined $10,050,000 to help six local housing developments apply for funding through the Minnesota Housing Finance Agency's annual consolidated request for proposals. The HRA will consider a formal resolution to confirm the reservations at its next meeting; no vote was taken on the item.

The reservations are intended to improve each project's competitive score in Minnesota Housing's RFP and are not binding commitments to lend or sell property, staff said. "I want to emphasize that this is a reservation of funding only," said Sarah Zorn, multifamily housing finance manager in the city's Planning and Economic Development (PED) office.

The reservation amounts and related project details presented to commissioners were: - Hams East End Apartments (developer: JB Vang) ' reservation $4,000,000; HRA-owned land purchase price shown as $300,000; new construction of 110 affordable units; total development cost estimated at about $48,000,000; tentative developer status first awarded June 2023 and administratively extended through 2025. The developer has secured some Met Council and Ramsey County grants and is completing design, environmental work, and historic designation steps. - Gloryville, 1570 White Bear (developer: Gloria Wong) ' reservation $2,500,000; HRA land purchase price $57,820; 87 affordable units plus 23,000 sq ft of commercial space including a grocery; total development cost ~ $50,000,000; tentative developer status May 2023 and administratively extended. The project has Met Council and Ramsey County funding commitments. - Face to Face, 1170 Arcade ' reservation $650,000; HRA land purchase price $1; four-story mixed-use building with 24 deeply affordable units and 6,000 sq ft of office space for service providers; total cost ~ $13,000,000; the developer has county housing supports for the 24 units and is pursuing additional fundraising. - Torre de San Miguel (CommonBond Communities) ' reservation $1,000,000; existing West Side complex of about 142 townhouse units on a 10-acre site; comprehensive rehab estimated at about $60,000,000; most units already have project-based vouchers or other housing supports and the project has county and foundation funding plus participation in Minnesota Housing tax credit rounds. - Aragon, 470 White Bear (Beacon Interfaith) ' reservation $500,000; 53-unit workforce building serving households at 30'—5% AMI, with about 25% of units sized as 3- and 4-bedroom units; developer secured 21 project-based vouchers through the PHA; estimated cost ~$25,000,000. - Ramsey Hill (Trellis) ' reservation $1,400,000; 54-unit rehab across six buildings in Cathedral Hill serving households at 30'—5% AMI; last rehab completed 1996; total development cost estimated at ~$18,000,000; developer has 13 project-based voucher commitments and is working with existing lenders on financial restructuring.

Applications to Minnesota Housing are due July 10, staff said; final award decisions are made later in the year and successful projects will still need to complete underwriting, negotiate funding details and return to the HRA for approvals such as land sales, bond issuances, tax credit allocations and development or loan agreements. "These numbers represent what the developer has estimated as their financing gap at this point in time," Zorn said, cautioning that estimates may change with interest rates, credit pricing and other funding outcomes.

Commissioners asked about selection and whether any applicants were excluded; staff replied that the HRA had reserved funding for all projects that approached the agency seeking a reservation. Commissioners also asked how the HRA communicates the reservation to Minnesota Housing; Miss Warren said the adopted resolution will be provided to developers for attachment to their state applications.

The staff presentation recalled that the reservation process was newly scored by Minnesota Housing last year (this is the HRA's second year taking the reservation action) and that reservations can earn applicants additional points in the state scoring process. Zorn and Director Newton said the reservations do not create enforceable obligations and that final funding, underwriting and HRA approvals will follow the state award process.

No formal motion was made during the meeting; staff said the HRA will take a single consolidated action next week to confirm reservations for all six projects. Commissioners were invited to raise project-specific questions with staff prior to that meeting.

Looking ahead, staff said they will provide the adopted resolution to applicants and consider attaching a formal letter of support alongside the resolution when submitting to Minnesota Housing.

Ending: The item was informational at this meeting; a single resolution to confirm the reservations will appear on the HRA's agenda next week for a formal vote.