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Committee approves financing package and ground lease for Market Heights affordable housing project
Summary
Committee forwarded a financing and ground lease package to acquire and rehabilitate Market Heights (46 units) in Bernal Heights as conduit financing with no recourse to the general fund; tenants will be temporarily relocated and eligible to return, rehabilitation expected to finish in early 2020.
The committee recommended approval of a multi‑housing revenue note (up to $18M), a long‑term amended and restated ground lease (up to 75 years with option to extend), and a jurisdictional transfer of city land to the Mayor's Office of Housing and Community Development for the Market Heights apartment rehabilitation project (46 units).
MOHCD staff said the financing is conduit debt with no recourse to the city's general fund. The project will rehabilitate an existing 46‑unit multifamily affordable property at Putnam/Tompkins in Bernal Heights; 22 units will serve families earning up to 60% AMI. Staff said tenants will be temporarily relocated and are eligible to return to the rehabilitated building. The ground lease base rent is $15,000 per year; residual rent, if any net operating income exists, would be limited and consistent with typical affordable‑housing ground leases.
The BLA summarized the transaction mechanics and concurred that terms are consistent with affordable‑housing ground leases; staff said financing is on track to close by the end of the month and rehabilitation should be complete in early 2020. Committee voted to forward items 15–17 to the full Board with a positive recommendation.
