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Committee forwards two affordable-housing financing items: Turk & Eddy ground lease and Ambassador Hotel bond request
Summary
The committee forwarded an amended long-term ground lease for an 82-unit affordable project at Turk and Eddy and a conduit bond allocation request for the Ambassador Hotel rehabilitation (55 Mason Street), both to be returned to the Board for final approvals.
The Budget and Finance Committee on Jan. 29 moved two housing finance items to the full Board with positive recommendations: an amended ground lease for an 82-unit 100% affordable rental project at Turk and Eddy Streets, and a resolution to seek tax-exempt mortgage revenue bonds for rehabilitation of the Ambassador Hotel at 55 Mason Street.
MOHCD (represented in the record by Holly Faust for the ground lease and Caroline McCormack for the bond request) told the committee that the Turk and Eddy lease amendment is tied to the project sponsor—s refinancing and does not change lease terms, city financing or the property—s use; the ground lease remains 55 years with a 44-year extension and planning review was waived. On the Ambassador Hotel, MOHCD said the proposed conduit bonds (not backed by city funds) would support rehabilitation into all single-room-occupancy units, with a hybrid tax-credit structure: about 102 units in the 4% bond portion and 32 units in a 9% portion; all units would be affordable to households at below 60% of area median income; temporary off-site relocation is anticipated during rehabilitation.
Why it matters: both actions preserve and rehabilitate affordable units in the city without new direct city subsidy for these financing changes; the Ambassador project will return for final bond approvals and financing is anticipated to close in the first quarter of 2021.
Quotes: "There is no new funding from the city on this," said the MOHCD presenter on the Turk and Eddy lease amendment. "A 100% of the units in the building will be affordable to households earning less than 60% AMI," said Caroline McCormack, MOHCD project manager, describing the Ambassador Hotel proposal.
Ending: Both items were forwarded to the Board for final consideration; MOHCD plans to return later in 2020 for bond issuance approvals for Ambassador Hotel.
