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Home My WebLink About2011-04-07 HRA AGENDA PACKETHOUSING & REDEVELOPMENT AUTHORITY AGENDA 6:30 P.M. Thursday April 7, 2011 Special Meeting Public Safety Training Room 825 41 Ave Columbia Heights 1. Call to Order 2. Roll Call Tammera Diehm, Chair Bruce Nawrocki Bobby Williams, Vice Chair Donna Schmitt Gary Peterson, Secretary/Treasurer 3. Pledge of Allegiance BUSINESS ITEMS 4. Interviews a. CommonBond Communities b. Aeon (Formerly Central Community Housing Trust) The next regular HRA meeting will be Tuesday, April 26, 2011 at Parkview Villa. COLUMBIA HEIGHTS HOUSING AND REDEVELOPMENT AUTHORITY (HRA) S ecial Meetin r of April 7 2011 AGENDA SECTION: Business Items ORIGINATING EXECUTIVE NO: 4 DEPARTMENT: HRA DIRECTOR APPROVAL ITEM: Request for Qualifications BY: Scott Clark BY DATE: March 30, 2011 BACKGROUND: As part of the 2010 PHA Plan the HRA directed staff to begin a process of identifying potential buyers of Parkview Villa North and South. Staff spent last year in a number of discussions with both for -profit and non -profit housing owners to identify interest. The difficulty in obtaining interest rested on several factors: 1) Parkview is a hybrid -asset with Parkview Villa North being under subsidy contract with the Department of Housing and Urban Development (HUD) and the dissolution of the contract will need HUD approval. Staff has been consistent and clear in all discussions (to both the HRA and potential owners) that HUD could refuse to allow the dissolution, meaning that time and resources spent may not allow the transaction to occur. Parkview Villa South has no outside controls but over the years the HRA has maintained rental levels slightly below market. 2) A new owner will have to secure some type of financing that will allow a subsidy to remain for Parkview Villa North 3) This project also has internal complexities regarding pricing. Parkview Villa South has little value due to the current rent structure and the need to capitalize a rehabilitation fund. The value in this project comes from Parkview Villa North which was funded by HUD with minimal equity by the HRA. The question is how can the HRA achieve adequate proceeds from a sale? On January 25, 2011 the HRA gave direction to staff to proceed with a Request for Qualifications with Intent to Purchase (RFQ). A copy of the RFQ is attached which contains the HRA's goals regarding the sale. Staff has received two very qualified proposals, the companies are CommonBond Communities and Aeon (formerly Twin Cities Housing Trust Corporation), both non - profits. Both companies will be making a presentation to the HRA and reviewing their RFQ's. The central issues are: 1) Which company will be successful in getting HUD to agree to a dissolution? 2) Which company will be the most successful in obtaining new financing? 3) Will there be value added assets that will be part of the sale? Attached with this report are packages from both firms including their individual company profiles and their response to the RFQ. Staff views that each company will need at least 45 minutes for their individual presentations and for questions and answers from the HRA. RECOMMENDATION: Staff seeks direction from the HRA as to which non -profit they desire to partner with and any additional directions regarding process and /or constraints. Attachments: Original RFQ, Responses HRA ACTION: REQUEST FOR QUALIFICATIONS AND INTEREST IN THE PURCHASE OF SUBMITTAL DUE DATE: March 18, 2011 Request For Qualifications and Interest Feb 11,2011 Columbia Heights, Mn. REQUEST FOR QUALIFICATIONS Purchase of Parkview Villa North and South 965 401h Ave NE Columbia Heights MN 55421 Overview The City of Columbia Heights Housing and Redevelopment Authority (HRA) is requesting statements of qualification (RFQ) and interest in the purchase of a total of 146 units of multiple family housing. The units are based in two buildings. The first is Parkview Villa South, which is a senior 45-unit facility with a current minimurn age requirement of 55. The second facility, Parkview View Villa North, is a 9 story, 101 -unit, Public Housing Agency (PHA) building. Currently, residency requirements are either senior with a minimum age of 62 or occupancy based on Federal definition of disabled. The HRA is seeking established housing development entities, for- profit or non-profit, that has the ability to perform the following as part of the sale: 1) Technical expertise to partner with the HRA in a submittal to HUD's Special Application Center for the dissolution of Parkview Villa North's PHA status. 2) Demonstration of ability to obtain new financing for both facilities. 3) Ability to perform the aforementioned objectives coupled with the HRA's goals, as depicted within the main body of this RFQ. The intent of the HRA is to interview interested parties to determine a mutual interest in establishing a process for the eventual sale of the subject properties. It is understood that as part of this RFQ the HRA has no obligation to select any candidate and that the HRA and the selected candidate retains the right to terminate their interest prior to the signing of a purchase agreement. If any applicant desires more information on the physical aspects of the building and/or desires a walk through of the facility, please contact the Community Development Department at 763.706.3678 Statement ®f Qua ffmcations Due Date and Time In order to be considered, one (I) unbound and ten (10) bound copies of the statement of qualifications must be received by the HRAs' Community Development Department by 4:00 p.m., Friday March 18, 2011. Submittals should be made to: City of Columbia Heights Attn: Scott Clark 590 40"' Ave N.E. Columbia Heights, Mn 55428 Request For Qualifications and Interest Feb 11,2011 Columbia Heights, Mn. HRA Goals As part of the special applications process, and the parameters of what the HRA desires in the sale of the subject property, the following goals should serve as a starting point for any potential buyer: a) Maintaining the property as a strong and vibrant senior community b) Protecting the existing rental price points for a particular period of time c) A long term covenant of maintaining the property as senior d) Need for the sale to be at a market price e) Maintaining a Columbia Height's residency priority It is understood that these goals may be modified as the process unfolds but should be the starting assumptions for the initial request. Since the request is for qualification and interest to enter into an agreement for real estate, the HRA will not have any formal scoring system. The judgment of the HRA will center on the following: 1) The ability of the organization to partner with the HRA to process a request through HUD's Special Applications Center (SAC) for dissolution of the existing Public Housing Agency status of Parkview villa North. It is understood that in order to place any type of alternative financing on the subject building, HUD will have to agree to the dissolution, and that it is possible that they will disallow this action. The HRA is of the opinion that no formal HUD action will occur on a SAC request until (a) A formal application is made and (b) the HRA has a viable partner to discuss and formalize alternative financing. 2) The type of alternative financing that may be put into place to meet the aforementioned HRA goals. 3) The ability of the subject organization to successfully transact and finalize a sale, based on the assumption that HUD allows the PHA modification to occur. Narrative and InLorniation Requirements Applicants should submit a narrative, and any applicable background information, for the following items: 2 Request For Qualifications and Interest Feb 11,2011 Columbia Heights, Mn. 1) Are the HRA goals workable or are modifications necessary to make the process more realistic? 2) Describe your overall organization, e.g. size of company, assets held, mission statement, 111U1UUU OUr U. -ULIUIIS management and o erslup experience. 3) Describe your organizations relevant experience in working with HUD? 4) Describe why you organization views that they can be successful in working through the special application process that will be required to convert the Public Housing Agency status. 5) To maintain the goal of subsidized housing, what programs and/or financing would you attempt to put into place? 6) Would you contract management or do it through your parent organization? 7) Would you add any services to what exists or continue as is? 8) The HRA desires to have parties submit a proposal regarding purchase price for both buildings. It is understood that this pricing proposal will be general in nature, and will serve only as a starting point for negotiations since the type of programs, interest rates, HUD approval requirements, HRA goals, etc. may all have a impact on the initial purchase price quote. Interview Process After review of the RFQ submittals it is anticipated that the HRA (in addition to two Commissioners from the City's Economic Development Authority) will establish an interview time in April. The next steps of the process will depend on the interview, number of applicants and other factors. As stated before, the HRA retains the right to terminate this process until the time of signing of a purchase agreement, with no recourse for time and/or materials spent in responding to this RF Q. a) Photograph of building b) Lot layout c) Twenty year capital plan executive surnmary (6/15/09) for Parkview Villa South d) Parkview Villa North 2011 PHA Plan e) FY 2011 operating budget for Parkview Villa North and South f) Summary Statement of building configuration, lot size and rents Attachment u Park View Villa North Park View Villa South Attachment b . A N �` '� • 965 - 40th Avenue NE N, CJ as as E Vi CO 2 ) E 0 E a tG CL f . om err cV LO In t- t'— N CIJ m N co I CD C. I - - co U) V) z z N C3 > C3 ooz 0 0 I— Z EY E. r D 2:1 lLf wv)- Attachment d PHA 5-Year and U.S. Department of Housing and Urban ONM No. 2577-0226 DieVC10pMent Expires 4,130/2 Annual PIRn Office of Public and Indian Housing 'IPA information �HA Name: Columbia Heights Housing & Redevelopment Authori PHA Code: PHA Type: rZ Small F High Performing E] Standard HCV (Section 8) PHA Fiscal Year Beginning: (__kMYYYY): �0 nventory �(bmcd onACC units at time of FY beginning in 1.0 above) Niumber of PH units: 101 Number of FTCV units: 3.0 Submission Type E] 5-Y= and Annual Plan Annual Plan Only El S-Ycar Plan Only 4.0 PIIA Consortia 7, PHA Consortia: (Check box if submitting ajoint Plan and complete table below.) PHA Prograrn(s) Included in the prograins Not in the Program PHA 1: PHA 2: PKA 3: 5.0 5-Year Plan. Complete items 5.1 and 5.2 only at 5-Year Plan update. 5.1 Missio I n. State the PIIA.'s Mission for serving the needs o'low-incDme, very lo and c-xtrcmcly low income fan, ilics in the PHA jurisdiction for the next five years: 5.2 (Toals and Objectives. Identify - the PILk's quarnif able goals and objectives that eiiable the PHA to sci - vu the needs of low-income and very low-income, and extrcirely low-income faluilits for the next five years. Include a report on the progress the PHA has made in meeting the 9cals and objectives diescTibad in the previous 5-Y�-ar Plan. 6.0 PELk Plan Update (a) Identify all PHA Plan elements that have 'been revised by the PHA since. its last Annual Plan submission: Non-, (b) Identify the specific location(s) where the public -may obtain copies of the 5-Year and Annual PHA. Plan. For a complcte list Of PHA Plan e lements, see Section 6.0 of the hastructions. Main administrative office of the PHA, PHA development management offices and the Public Hope V1, Mixed Finance Moderniz2don or Development, Demolition and/or Disposition, Conversion of Public Housing, Homeownership 7.0 Pro-rams, and Project-based Vouchers. 17iclude statements related to these programs as applicable. Coh7mbia Fcights HRA will continue discussion of the future disposition of Par1cview Villa North (MN1 D5- 101 units of public housin The anticipated timelint is to continue to idtnti:,�Z a purchaser in 2011 and begin the process and completion by late 201 Capital Improvements. Please completc Parts 8.1 through 8.3, as applicable. Capital Fund Program Annual Statement/Performance and Evaluation Report. As part of the PFIA 5-Year and Annual Plan, a��ually 8.1 complete and submit the Capi�alFundDro,�rci7�i,477iiiiaZState777entIPerformance and Evaluation Report, ferni HUD-50075.1, for each current and open CFP grant and CFFP financing. Capital Fund Program Five-Year Action Plan. As Pall Of the submission of the Annual Plan, PHAs must complete and submit the �,_pitIF-,d ..2 _Pro Five-Year Action 1`107, form HUD-50075.2, and subsequent annual updates (on a rolling basis, e-g., drop current year, and add latest year for a five year period). Large capital items must be incluc�cd in the Five-Year Action Plan. 8.3 Capital Fund Financing Program (CFFP). its Cap ital Fund Program (CFP)aeplacement Housing Factor CREF) to repay debt incurred to El Check if the, PHA proposes to use any portion of I finance capital in pmvemants. Housing Needs. Based on infomation provided by the applicable Consolidated Plan, information provided by HUD, and other generally available 9.0 data, make a reasonable effort to identify the housing needs of u ?e lovr- income, very low - income, and exxtremcly low - income families who reside in the jurisdiction sea ed by the PHA, including elderly families, families with disabilities, and households of various races and ethnic Groups, and other families who are on the public housing and Seetion E tenant -based assistance waiting lists. The identification of housing needs must address issues of affordability, supply, quality, accessibility, size of units, and location. Quality affordable housing for extremely low income elderly families and families with disabilities is a need within the jurisdiction. The PHA provides 101 — one bedroom units for qualified extremely low income elderly families and families with disabilitics within the jurisdiction ofthc PHA. 11.0 Required Submission for= Field Office Review. In addition to the PHA Plan template (HUD - 50075), P_L s must submit the following documents. Items (a) through (g) may be submitted with signature by mail or electronically with scanned signatures, but electronic submission is encouraged_ Items (h) through (i) must be attached electronically with the PHA Plan. Dote: Faxed copies of these documents will not be accepted 6y the Fieid Office. (a) Form HUD- 50077, PHA Certifications of Compliance with the PHA Plans and Related Regulations (which includes all certifications relating to Civil Rights) (b) Form HUD -50070, Certocation fora Drug -Free Fforkplace (PHAs receiving CFP grants only) (c) Form HUD- 50071, Cert feat on of Payments to Influence Federal Transactions (PHAs receiving CFP grants only) (d) Form SF -LLL, Disclosure of Lobbying, Activities (PHAs receiving CFP rants only) (c) Form SF -LLL -A Disclosure of Lobbying Activities Continuation Sheet (PHAs receiving CFP grants only) (t) Resident Advisory Board (RAB) comments. Comments received from the RAB must be submitted by the PHA as an attachment to the PHA Plan. PHAs most also include a narrative describing their analysis of the recommendations and the decisions made on these recommmendations. (g) Challenged Elements (h) Form HUD - 50075.1, Capital Fund Program Annual StatemenelPerfor mance and Evaluation Pe (PHAs receiving CFP grants only) (i) Form HUD- 500752, Capital Fund Frogram Five -Year Action Plan (PHAs receiving CFP grants only) Page 2 of 2 form HUD -50075 (4/2008) Strategy for Addressing Housing Needs. Provide a brief description of the PHA's strategy for addressing the housing needs of families in the 9.1 Jurisdiction and on the waiting list in the upcoming year. Note: Small, Section 8 only, and High Performing P73As complete only for Annual Plan submission with the 5 -Year Plan. Housing reeds of those on the waiting list are for housing that is available for extremely low income elderly and disabled families. The PHA has a preference in place for those that Iivc or work in the jurisdiction. The PHA plans to exceed the federal targeting requirement by targeting mare than 40% of all new admission to public housing to families at or below 30% of median area income. Additional Information. Describe the following, as well as any additional information HIJD has requested. 10.0 (a) Progress in Meeting Mission and Goals. Provide a brief statement of the PHA's progress in meeting the mission and goals described in the 5- Year Plan. Tile PHA continues to maintain an occupancy rate of 98% or above for the past year. The PHA is improving the quality of assisted 1 housing by continuing with the building modernization plan. Seven floors have successfully been modemized. The PHA completed and exterior building fapade repairs and painting. The PI-LA. continues with its relationship with Volunteers of America to provide dining services for those in the PHA. The PHA markets to all in thejurisdiction and continually works to ensure equal opportunity and affirmatively further fair housing. (b) Significant A=ndment and Substantial Deviation/Modifcation, Provide the PFLA's definition of "significant amendment" and "substantial deviation /modifi cati on" 11.0 Required Submission for= Field Office Review. In addition to the PHA Plan template (HUD - 50075), P_L s must submit the following documents. Items (a) through (g) may be submitted with signature by mail or electronically with scanned signatures, but electronic submission is encouraged_ Items (h) through (i) must be attached electronically with the PHA Plan. Dote: Faxed copies of these documents will not be accepted 6y the Fieid Office. (a) Form HUD- 50077, PHA Certifications of Compliance with the PHA Plans and Related Regulations (which includes all certifications relating to Civil Rights) (b) Form HUD -50070, Certocation fora Drug -Free Fforkplace (PHAs receiving CFP grants only) (c) Form HUD- 50071, Cert feat on of Payments to Influence Federal Transactions (PHAs receiving CFP grants only) (d) Form SF -LLL, Disclosure of Lobbying, Activities (PHAs receiving CFP rants only) (c) Form SF -LLL -A Disclosure of Lobbying Activities Continuation Sheet (PHAs receiving CFP grants only) (t) Resident Advisory Board (RAB) comments. Comments received from the RAB must be submitted by the PHA as an attachment to the PHA Plan. PHAs most also include a narrative describing their analysis of the recommendations and the decisions made on these recommmendations. (g) Challenged Elements (h) Form HUD - 50075.1, Capital Fund Program Annual StatemenelPerfor mance and Evaluation Pe (PHAs receiving CFP grants only) (i) Form HUD- 500752, Capital Fund Frogram Five -Year Action Plan (PHAs receiving CFP grants only) Page 2 of 2 form HUD -50075 (4/2008) - CJG IP QJ :D Cl cr, C-1 C t� C, UcD rat CJ O r CG O 0 El O 7 E5 El 7� CID tD vm 8 to 7— z CD ID O Cal EE C t� C, UcD rat CJ O r CG CIZ o 71 O O O O O M z rt r- � E iz O CZ) CD c C) Z) CZ) CD o 88 OD au r� O O I= 0 L 0 LtI) 0 L" 0 I-) 0 0 111 0 1l 0 Vl 0 O O O O O M Attachment e PARKVIEW VILLA NORTH - - - - - - PERSONAL SERVICES - 1000 ACCRUED SALARIES - - - - 1011 PART -TIME EMPLOYEES - 1070 INTERDEPARTMENTAL LABOR SERV 23,038 23,760 25,380 26,013 - - 1080 INTERDEPARTMENTAL LABOR CR - - - - - - 1210 P.E.R.A. CONTRIBUTION - - - - - 1220 F.I.C.A. CONTRIBUTION - - - - " 1300 INSURANCE - - - - - 1510 WORKERS COMP INSURANCE PREM - - - - - - 1700 ALLOCATED FRINGE - - - - - 1800 INTERDEPARTMENTAL FRINGE CR - - - - - - TOTALS: PERSONAL SERVICES 23,038 23,760 25,380 26,013 - - SUPPLIES - - - - 2000 OFFICE SUPPLIES 2,259 3,335 2,500 2,900 - - 2010 MINOR EQUIPMENT 3,993 10,753 - - - 2011 COMPUTER EQUIPMENT - - - - 2020 COMPUTER SUPPLIES - - 600 600 - - 2030 PRINTING & PRINTED FORMS - - 250 - - - 2070 TRAINING & INSTR SUPPLIES - - - - - 2160 MAINT. & CONSTRUCT MATERIALS 6,149 6,470 10,200 10,200 - - 2161 CHEMICALS - - - - 2171 GENERAL SUPPLIES 9,459 3,731 6,550 7,950 - - 2172 UNIFORMS - - - - 2175 FOOD SUPPLIES - - 450 - - - 2280 VEHICLE PARTS - - - - - TOTALS: SUPPLIES 21,860 24,288 20,550 20,150 - - OTHER SERVICES & CHARGES - - - - - 3020 ARCHITECT /ENGINEER FEES - - - - 3040 LEGAL FEES 13,012 2,523 - - - - 3041 ATTORNEY FEES -CIVIL PROCESS - - 5,000 5,000 - - 3050 EXPERT & PROFESSIONAL SERV. 1,889 1,598 5,000 2,500 - - 3060 MANAGEMENT SERVICES 153,602 154,824 154,824 154,824 - - 3100 PROTECTIVE SERVICES 5,365 11,342 - - - - 3105 TRAINING & EDUC ACTIVITIES - - - - - - 3210 TELEPHONE & TELEGRAPH 3,098 4,309 4,700 6,500 - - 3220 POSTAGE - - 600 600 - - 3250 OTHER COMMUNICATIONS - - 200 - - - 3310 LOCAL TRAVEL EXPENSE - - 150 150 - - 3320 OUT OF TOWN TRAVEL EXPENSE - - - - - - 3430 ADVERTISING OTHER 452 527 500 600 - - 3500 LEGAL NOTICE PUBLISHING - - 350 350 - - 3600 INSURANCE & BONDS 16,883 18,832 22,526 22,526 - - 3810 ELECTRIC 44,872 43,119 54,529 54,529 - - 3820 WATER 10,317 9,183 14,320 14,320 - - 3830 GAS 55,092 49,034 76,130 76,130 - - 3840 REFUSE 5,329 3,519 4,100 9,340 - - 3850 SEWER 8,323 6,003 8,279 8,279 - - 4030 EXTRAORDINARY MAINTENANCE 4050 GARAGE, LABOR BURD. 4100 RENTS & LEASES 4200 PROGRAM ACTIVITIES 4300 MISC. CHARGES 4315 PILOT 4330 SUBSCRIPTION, MEMBERSHIP 4335 TENANT SERVICES 4349 INSURANCE DEDUCTIBLE 4374 EMPLOYEE RECOGNITION 4376 MISCELLANEOUS CIVIC AFFAIRS 4380 COMMISSION & BOARDS 4390 TAXES & LICENSES 4395 STATE SALES TAX 4500 ADMINISTRATIVE EXPENSES 4850 INTEREST ON DEPOSITS TOTALS: OTHER SERVICES & CHARGE CAPITAL OUTLAY 5120 BUILDING & IMPROVEMENT 5130 IMPROV. OTHER THAN BUILDINGS 5170 OFFICE EQUIPMENT 5180 OTHER EQUIPMENT TOTALS: CAPITAL OUTLAY OTHER FINANCING USES 7100 OPER. TRANSFER OUT - LABOR 7431 TRANSFER OUT SPECIAL PROJECT 8100 CONTINGENCIES 8110 VANDALISM TOTALS: OTHER FINANCING USES TOTALS: PARKVIEW VILLA NORTH TOTALS: PARKVIEW VILLA NORTH GRAND TOTALS: 525 763 City of Columbia Heights 1,030 1,900 - 2011 Budget Work sheet 158 1,000 Department Proposed 19,047 203 PARKVIEW VILLA NORTH 20,574 Actual Actual Adopted Department Manager Council 46330 PARKVIEW VILLA NORTH 2,250 - Expense Expense 2008 2009 Budget 2010 Proposed Proposed Adopted 2011 2011 2011 Line Item Description neA o%trnrQ 465 dd `)R? rtd Riq _'( ^ ) 7.950 74.300 - - 4030 EXTRAORDINARY MAINTENANCE 4050 GARAGE, LABOR BURD. 4100 RENTS & LEASES 4200 PROGRAM ACTIVITIES 4300 MISC. CHARGES 4315 PILOT 4330 SUBSCRIPTION, MEMBERSHIP 4335 TENANT SERVICES 4349 INSURANCE DEDUCTIBLE 4374 EMPLOYEE RECOGNITION 4376 MISCELLANEOUS CIVIC AFFAIRS 4380 COMMISSION & BOARDS 4390 TAXES & LICENSES 4395 STATE SALES TAX 4500 ADMINISTRATIVE EXPENSES 4850 INTEREST ON DEPOSITS TOTALS: OTHER SERVICES & CHARGE CAPITAL OUTLAY 5120 BUILDING & IMPROVEMENT 5130 IMPROV. OTHER THAN BUILDINGS 5170 OFFICE EQUIPMENT 5180 OTHER EQUIPMENT TOTALS: CAPITAL OUTLAY OTHER FINANCING USES 7100 OPER. TRANSFER OUT - LABOR 7431 TRANSFER OUT SPECIAL PROJECT 8100 CONTINGENCIES 8110 VANDALISM TOTALS: OTHER FINANCING USES TOTALS: PARKVIEW VILLA NORTH TOTALS: PARKVIEW VILLA NORTH GRAND TOTALS: 525 763 1,077 1,030 1,900 - 1,281 158 1,000 2,050 - 19,047 21,762 20,574 20,574 - 1,063 1,443 2,500 2,250 - 5,248 3,614 - - - 63 465 225 150 - 389,980 387,950 439,487 457,397 - 72,675 63,819 155,956 112,000 - 72,675 63,819 155,956 112,000 - 507,553 499,817 641,373 617,060 - 507,553 499,817 641,373 617,060 - 507,553 499,817 641,373 617,060 - REVENUE 33160 FEDERAL GRANT 34114 EXCESS UTILITIES 36210 INTEREST ON INVESTMENTS 36219 CHANGE IN FAIR VALUE 36220 GEN. GOVERNMENT RENTS 36225 NONDWELLING RENTS 36290 OTHER MISC. REVENUE 39101 GAINILOSS FIXED ASSET 39120 RECOVERY DAMAGE CITY PROP 39130 EQUIPMENT RENTAL 39140 OTHER REF. & REIMBURSEMENT TOTALS: REVENUE TOTALS: PARKVIEW VILLA NORTH GRAND TOTALS: 256,486 275,002 345,681 357,500 - - 512 - 1,580 2,100 - - 20,340 17,700 5,000 6,891 - - 1,450 (5,100) - - - - 313,890 313,848 316,094 319,260 - - 2,588 3,021 2,900 2,900 - - 10,066 8,902 - - - - 853 - - - - - 606,185 613,373 671,255 688,651 - - 606,185 613,373 671,255 688,651 - - 606,185 613,373 671,255 688,651 - - \ t2 R I E `| / m z ` } } r| �/ ® ®` ^ ® ® ^§`/ ~ si, - In , � , , \ ��_ \ \ . �§ . , j } °!/§® �. :, �_ . ® ` \} /} i � �, .j � .� .� .�.. � � . . .� � . .�� ,4,l : ; , ,, ,; T E 6 19 6 6 A § § § § §(E /§ 6 6 I rEm rv(n rvs N_ Ma O G I m m o� °n Pms N MEN MEN R 99 i Im G PIS €m m G e ry n 4 loamm € t d m n ry N €G m P ry €e m ,I r _ € a 12�_ E € € �">a f r c r. G n 3 si m a v, rv�" G c M ry e F3 ° €m o m "�s G G i� o o 8 M INE nm m� mr ry s a l ry � 9� JIM _v >� ar ivN �owvvm� 4 I X p F o ." A S I E o S o o€ g S o 0 8 g o g rz �7E M -M 20 ff Ogle ul ME R PENN, i I mm Bike W 13 NMI MEN" R ON MEN H Ml T mar MEN RUN R - - - - - - - - - - FM T;p E w 0 2 g g ..... . *g MAE City of Columbia Heights 2011 Revenue Budget work sheet. Department Proposed 213 PARKVIEW VILLA SOUTH Actual Actual Adopted Department Manager Council 0 REVENUE I Revenue Revenue Budget Proposed Proposed Adopted Line Item Description 2008 2009 2010 2011 2011 2011 REVENUE 34114 EXCESS UTILITIES 36210 INTEREST ON INVESTMENTS 36219 CHANGE IN FAIR VALUE 36220 GEN. GOVERNMENT RENTS 36225 NONDWELLING RENTS 36290 OTHER MISC. REVENUE 39120 RECOVERY DAMAGE CITY PROP 39140 OTHER REF. & REIMBURSEMENT TOTALS: REVENUE TOTALS: PARKVIEW VILLA SOUTH GRAND TOTALS: 247 - 2,000 2,750 - - 8,960 10,500 2,500 - - - 640 (3,000) - - - - 288,791 290,940 287,892 296,529 - - 7,082 5,787 7,200 7,200 - - 5,562 3,852 2,465 2,400 - - - 110 500 250 - - 311,282 308,189 302,557 309,129 - - 311,282 308,189 302,557 309,129 - - 311,282 308,189 302,557 309,129 - - PARKVIEW VILLA SOUTH - - - - - - PERSONAL SERVICES - - - - - - 1000 ACCRUED SALARIES - - - - - - 1070 INTERDEPARTMENTAL LABOR SERV 12,230 12,020 11,402 11,687 - - 1300 INSURANCE - - - - - - 1700 ALLOCATED FRINGE - - - - - - TOTALS: PERSONAL SERVICES 12,230 12,020 11,402 11,687 - - SUPPLIES - - - - - - 2000 OFFICE SUPPLIES 993 1,468 1,600 1,900 - - 2010 MINOR EQUIPMENT 1,592 2,325 - - - - 2011 COMPUTER EQUIPMENT - - - - - - 2020 COMPUTER SUPPLIES - - 500 500 - - 2030 PRINTING & PRINTED FORMS - - 120 - - - 2070 TRAINING & INSTR SUPPLIES - - - - - - 2160 MAINT. & CONSTRUCT MATERIALS 3,671 1,324 5,000 5,000 - - 2161 CHEMICALS - - - - - - 2171 GENERALSUPPLIES 4,515 2,131 3,850 4,725 - - 2172 UNIFORMS - - - - - - 2175 FOOD SUPPLIES - - 250 - - - TOTALS: SUPPLIES 10,771 7,247 11,320 12,125 - - OTHER SERVICES & CHARGES - - - - - - 3040 LEGAL FEES 2,207 1,072 - - - - 3041 ATTORNEY FEES -CIVIL PROCESS - - 2,500 2,500 - - 3050 EXPERT& PROFESSIONAL SERV. 945 799 1,000 1,000 - - 3060 MANAGEMENT SERVICES 69,316 68,976 68,976 68,976 - - 3100 PROTECTIVE SERVICES 2,037 8,258 - - - - 3105 TRAINING & EDUC ACTIVITIES - - - - - - 3210 TELEPHONE & TELEGRAPH 1,872 1,867 2,100 2,500 - - 3220 POSTAGE - - 150 150 - - 3250 OTHER COMMUNICATIONS - - 100 - - - 3310 LOCAL TRAVEL EXPENSE - - 75 75 - - 3320 OUT OF TOWN TRAVEL EXPENSE - - - - - - 3430 ADVERTISING OTHER 235 907 600 750 - - 3500 LEGAL NOTICE PUBLISHING - - - - - - 3600 INSURANCE & BONDS 8,441 9,303 9,746 9,746 - - 3810 ELECTRIC 24,211 21,308 24,842 24,842 - - 3820 WATER 3,090 2,534 7,711 7,711 - - 3830 GAS 26,500 17,196 20,650 20,850 - - 3840 REFUSE 58 498 2,001 2,500 - - 3850 SEWER 1,592 1,805 2,564 4,481 - - 4000 REPAIR & MAINT. SERVICES 23,134 37,148 37,100 44,442 - - 4030 EXTRAORDINARY MAINTENANCE - - - - - - 4100 RENTS & LEASES 60 238 - - - - 4200 PROGRAM ACTIVITIES - - - - - - 4300 MISC. CHARGES 760 112 750 900 - - 4315 PILOT 11,679 13,015 12,368 12,368 - - 4330 SUBSCRIPTION, MEMBERSHIP - - - - - - 4335 TENANT SERVICES - - - - - - City of Columbia Heights 2011 Budget work sheet Department Proposed 213 PARKVIEW VILLA SOUTH Actual Actual Adopted Department Manager Council 46340 PARKVIEW VILLA SOUTH Expense Expense Budget Proposed Proposed Adopted Line item Description 2008 2009 2010 2011 2011 2011 4374 EMPLOYEE RECOGNITION 4376 MISCELLANEOUS CIVIC AFFAIRS 4380 COMMISSION & BOARDS 4390 TAXES & LICENSES 4395 STATE SALES TAX 4500 ADMINISTRATIVE EXPENSES 4850 INTEREST ON DEPOSITS TOTALS: OTHER SERVICES & CHARGE CAPITAL OUTLAY 5120 BUILDING & IMPROVEMENT 5130 IMPROV. OTHER THAN BUILDINGS 5170 OFFICE EQUIPMENT 5180 OTHER EQUIPMENT TOTALS: CAPITAL OUTLAY OTHER FINANCING USES 7100 OPER. TRANSFER OUT - LABOR 7411 TRANSFER OUT TO PVVS 8100 CONTINGENCIES 8110 VANDALISM TOTALS: OTHER FINANCING USES TOTALS: PARKVIEW VILLA SOUTH TOTALS: PARKVIEW VILLA SOUTH GRAND TOTALS: 577 559 1,250 1,250 - - 1,249 1,409 - - - - 50 66 225 85 - - 178,013 187,067 194,708 205,126 - - - 32,242 64,350 35,000 - - - 32,242 64,350 35,000 - - 201,015 238,576 281,780 263,938 - - 201,015 238,576 281,780 263,938 - - 201,015 238,576 281,780 263,938 - - 61 - - - - - - I I N om' 1 gi - m E � E j � � I two 29.. m M IN P m m �4 r 2 H i ll q "I gm gC m gn I S I S I S I S I S , U 6 6 6 -- HE 6 4 6 6 6 111 E - m Sig g gnma i - Ul- 1 9m 1 lo - 51 NEW' IN 11111111 s a - s 8 a a a a 1 a B a a a a ER U-ml Ell NOR, NEI N N N Ph 1 MEN !MIN m IN 111 E - m Sig g gnma i - Ul- 1 9m 1 lo - 51 NEW' IN 11111111 s a - s 8 a a a a 1 a B a a a a Attachment f Parkview Villa 965 40"' Avenue NE Columbia Heights MP-1 v Zn North Building 101 units all one bedroom South Building 45 units four 2 bedrooms 43 one bedrooms North is a subsidized building with senior and disabled. Senior is 62 and older South is a market rate senior building 55 and older Base rent at the North building is $599 Base rent at the South building is $562 one bedroom and $715 two bedroom Average unit size is 570 sq ft Parkview Villa North was built in 1974 Parkview Villa South was built in 1990 There is a 27-stall underground parking garage that serves both buildings. Spots are available to the residents for $30 a month. There are 49 surface stalls. Both buildings are no smoking Laundry and vending proceeds are split 50/50 between the Resident Council and the Columbia Heights HRA There is an existing site lease agreement between T-Mobile and the HRA for 250 square feet of rooftop space that is being used for antenna usage. The lease agreement currently has a value $20,780. The HRA assumes that T-Mobile desires to continue this lease and will want to renegotiate for either an annual lease payment or a long -teen lump sum present value amount. REQUEST FOR QUALIFICATIONS Purchase of Parkview Villa North and South 065 40 Ave NE Columbia Heights MN 5542-1 Submitted by CommonBond Communities March 18,2011 0 �Z I'll EM "fanam=6 Since 197l,CommooDood Communities has been building homes hope and community. From its start as a small progan of the Archdiocese of Saint Paul and Minneapolis, CommonBond has become the Upper Midwest's largest nonprofit provider of affordable housing with on-site services. CommonBond owns or manages nearly 5 units iu approximately lU0housi communities, located insome 50 cities and towns, in Minnesota Wisconsin and Iowa. Close to 8,000 people — families, seniors and people with disabilities uodutberhmrieru — uuUCoozo/ouDoodbonoe. CommonBond is a nationally-recognized leader and innovator in the affordable housing industry. lip/us one ofthe first housing providers to include services for residents —Advantage Sorvicoo — initopzopedieo and to insist that its housing be a long-term asset to the surrounding neighborhood. Engagement with the local community has long been uComozonDuodhallmark. We have demonstrated that quality affordable housing combined with onsite services can transform lives and communities. Cities, public agencies, faith communities, community organizations and for-profit and non-profit owners seek out CommonBond because we offer a specific set of affordable housing and community development competencies and experience. Our expertise includes: • Deep and diverse real estate development capabilities • Advantage Services that deliver stability, advancement and independence for residents • Comprehensive, propel y management services • Community engagement expertise and commitment • Exceptional reputation oau trusted partner • Entrepreneurial approach to our social mission .::.:. ..: . 1.) Are the HRA goals workable or are modifications necessary to make the process more realistic? ate a) Maintaining the property as a strong and vibrant senior community b) Protecting the existing rental price points for a particular period of time c) A long term covenant of maintaining the property as senior d) Need for the sale to be at a market price e) Maintaining a Columbia Heights residency priority CommonBond strongly agrees with the HRH's goals for the Parkview properties. As described below, CommonBond proposes to preserve and maintain the properties as affordable rental housing for 30 or more years. Throughout our tenure as the manager of these properties, CommonBond has demonstrated its commitment to the delivery of quality affordable senior housing with services in Columbia Heights. The specific terms of the rent structure, residency and senior targeting and /or covenants are described in further detail in this document, but will ultimately be subject to HUD and lender approvals. Residency restrictions will be subject to applicable Fair Housing requirements. The market value of these properties will largely be driven by the rent levels. The current affordable rent levels restrict the amount of debt the properties can support. As discussed herein, CommonBond is committed to finding creative financing alternatives which will increase the feasibility of the financing structure and the return to the city. Appraisals will be obtained as a part of the due diligence process, which will provide further documentation of the as -is value of the properties. Overall, CorninonBond will assess both the physical and resident needs of the property in a coordinated manner and will bring the tools to bear to maintain sustainability and independence for the residents and continue to be a partner in the community. As described herein, CommonBond's holistic approach to our properties results in comprehensive, long -term stability and viability. 2.)Describe your overall organization, e.g. size of company, assets held, mission statement. Include your organizations management and ownership experience. COMMONBOND'S VISION: Every person has a dignified, affordable home that supports independence and advancement within a flourishing community. COMMONBOND'S MISSION: CommonBond builds stable homes, strong futures, and vibrant communities. CommonBond Communities achieves its mission, in large part, through the work of its 305 full - time and 49 part-time employees. Our leadership team brings experience from many disciplines Page 2 in the nonprofit, for profit and public sectors. We have attracted some of the most talented professionals in their fields. Over 200 staff members work on -site in property management or Advantage Services at our various housing communities. Staff is responsible for performing day - to -day operations, including maintaining the financial and physical condition of the properties, providing top quality or.-site services, and overall accounting, executive management, fimdrarsrng and administration functions. CommonBond makes a concerted effort to employ those who live in or have lived in CommonBond housing. Strong volunteer governing boards support and guide the staff. There are 28 members on the CommonBond Communities board of directors and nine members on the CommonBond Housing board of directors. The CommonBond Communities board of directors has been fully engaged in four primary governance tasks: business planning, preparing for a leadership transition, policy and public education, and launching a major capital campaign. Growth continues to be essential to fulfill our mission but must be calibrated and balanced with maintaining our current portfolio. Advantage Services is an integral part of CommonBond's mission: the level of service in each property is determined by resident needs and available facilities. Local investment and engagement will be expected for entry and growth in expansion markets, with CommonBond's footprint likely to be deep rather than wide. CommonBond achieves its mission of creating affordable housing communities as steppingstones to success by focusing on the needs of residents. Staff is responsible for maintaining the financial and physical condition of the properties through top - quality management, maintenance, accounting, administration and asset management expertise. Since 1971 CommonBond Housing has offered full - service property management and marketing services, corporate maintenance, centralized accounting, information services and compliance departments. Our ownership and management portfolio includes a wide variety of affordable and market rate housing ranging from a seven -unit specialized community in Minneapolis to Skyline Tower in Saint Paul, a 504 unit high rise. Our housing communities include senior and family affordable housing communities, market -rate properties, properties serving persons with mental and physical disabilities, people Living with AIDS, as well as an assisted living facility. Our 5,000 plus units are located in three states in the Upper Midwest: Minnesota, Iowa and Wisconsin. Attached are detailed listings of the properties in CommonBond's portfolio, our most recent annual plan, organizational chart, and leadership team resumes. Describe your organization's 1 ? ' with HUD? Property management staff works closely with HUD, MHFA, Affordable Housing Connections, MPHA and Families Moving Forward for Section 8, Section 236, Section202, Section 811, Section 42, PRAC and Market Rate. Staff is also experienced with Hollman, HOME as well as Housing Trust Fund programs. Kurt Keena, Vice President of Property Management brings over 20 years of experience in the field, most recently as Director of Property Management of the 2000 unit portfolio of tax credit, bond and HUD financed properties at the Dakota County Community Development Agency. Prior experience also includes direct work with HUD on the Public Page 3 Housing program while employed with the St. Paul Public Housing Agency. Kurt brings a focus on people, processes and systems that impact the sound management of the properties. CommonBond's compliance team consists of I I staff members with total compliance experience of 31 years. Designations for these staff members consist of AHM, TaCCs, COM -8, COM-42, COS -8, COS -42, C6P, STAR, Housing Choice Voucher Specialist, Public Housing Occupancy Specialist, and Public Housing Eligibility Specialist. The compliance team's experience consists of Section 8, tax credit (Section 42), tax - exempt bonds, HOME, Hollman (PHA) and many other local, state and federal affordable funding programs. The compliance team prepares and provides all reporting requirements to third parties as outlined in the funding documents for each property. To ensure best practices, the compliance team reviews and updates compliance procedures for all properties as well as corporate level documentation for each property. In addition to the global compliance requirements, the compliance team reviews all certifications to ensure all federal, state and local regulations are met for each property and is also involved with all state and federal file audits, management and tax credit reviews. The compliance team also assists staff at the site level when a need arises. CoanmonBond's Housing Development staff work closely with HUD Community Development and Multifamily staff and have a long - standing relationship with the Department. Housing Development staff have extensive experience with the HUD HOME, CDBG, SHP, ESG, Section 8, and FHA- insured programs. CommonBond owns senior housing properties that operate under Section 202 and Project Rental Assistance Contracts (PRAC's) and has extensive experience providing on -site resident services, including HUD supported service coordination, through its Advantage Services Department. Advantage Services staff complete the Semi - Annual Perfonnance Report for Multifamily Housing Service Coordinator Program and submits them to HUD. These properties also have on -site computer labs and participate as members of HUD's Neighborhood Networks effort 4.) Describe why your organization views that they can be successful in working through the special application process that will be required to convert the Public Housing Agency status. CommonBond has demonstrated ability and capacity to partner with the HRA to process a Disposition request through HUD's Special Applications Center (SAC) for dissolution of the existing Public Housing Agency status of Parkview Villa North. It is understood that in order to place any type of alternative financing on the subject building, HUD will have to agree to the disposition and dissolution, and that it is possible that they will disallow this action. CommonBond is positioned to be a strong and a viable partner with the HRA to navigate this process. Kurt Keena, Vice President of Property Management, has successfully coordinated disposition applications with SAC a number of times. Dispositions include public housing units, excess land, and an office building, all of which required HUD to release their Declaration of Trust on the properties. Page 4 CommonBond will work closely with the RRAWensure that all of the HUD Disposition requirements are fu|fiDcd,including the following: • HUD wiKnot approve an application for demolition or disposition unless the application has been developed io consultation with tenao1 of the project involved, any tenant organizations for the project, uodanyPH\vvidetoouotoo§aoizadiouatha1vviDbex±fectod by the demolition or disposition. CommonBond will collaborate closely with the HRA to design and implement a comprehensive resident consultation process. • HUD requires that the rationale for the proposed disposition meet certain specified criteria. This may include a determination that selling the property is determined to be more cost-effective or efficient way for the development to be used for low-income or mixed-income housing, because that party will have access to funds not available to the PHA. Coouruoo8ond will help the 8IlA and delineate and validate the necessary documentation. A copy of the HUD Inventory Removal Application form is attached N the document for ;�.) To maintain the goal of subsidized housing, what prograll and/or financing would you attempt to put into place? CoinmonBond has researched numerous options for both acquisition financing for both properties and ongoing rental assistance for the Parkvim*North property. CommonBond would obtain a long term permanent mortgage loan from a private lender to cover the purchase price and related costs. Cooun000Bnndiu specifically exploring permanent debt options through TJS8uok and the Minnesota Housing Finance Agency's I.MIR program. Current rates and terms are favorable and appear to support the feasibility of such financing. CommonBond's experienced Housing Development staff will ensure that the new pernianent loan financing is underwritten efficiently and conservatively. As we have discussed with the City, securing long-term rental assistance for the PadovicvvNorth property is critical to the feasibility ofthis ycopuou|. The most promising option for procuring rental subsidies is HUD's ]ranofbnoimg Rental Assistance (TKA) initiative. Attached is an excerpt of HUD Secretary Donovan's Fiscal Year 2012 Budget Summary document describing the proposed reintroduction of a $200 million TRA demonstration program for 2012. This program would create uu option to convert current public housing subsidy tmu long-term project- based 0 cctinnQreutoluumis1uocucoo1cuc1.WeunduratoodtbatTKAp/onldpoteo1iu|lvoJlun/ contract rents 1obu based oul\U%ofFMD. As you know, local Representative Keith Ellison has also been active io designing and promoting this initiative. Our industry sources indicate that there are ongoing senior-level HUD meetings and other key interest group meetings currently underway to clarify the II{A proposal and build support. The timeline for implementation of TRA is not yet clear, In the meantime, an option CommonBond would be willing to explore would be to create ajoint ownership structure whereby the HRA remains a part owner of the property on an interim basis in order to maintain the public housing rent subsidy until Project-Based Section 8 or other rental assistance programs would be available. A similar model has been devised for the many 'Hollman' replacement public housing units in suburban developments. im Our track record demonstrates that CommonBond has the ability to successfully transact and finalize a sale in a timely manner, based on the assumption that HUD allows the PHA modification to occur. Recent similar transactions include the acquisition refinance and rehabilitation of numerous project -based Section 8 properties, including the Whittier Cooperative in Minneapolis, Maple Hills Apartments in Red Wing, and Northern Apartments in Chippewa Falls WI. CommonBond successfully worked with HUD to secure 20 -year HAP contract renewals for these properties, along with numerous layers of city, state, county and federal funds. Would 1 u contract management or 10 through parent organization? We would continue to provide property management through CommonBond Housing. Since 1971 CommonBond Housing has offered full- service property management and marketing services, corporate maintenance, centralized accounting, information services and compliance departments. Our management portfolio includes a wide variety of affordable and market rate housing ranging from a seven -unit specialized community in Minneapolis to Skyline Tower in Saint Paul, a 504 unit high rise. Our housing communities include senior and family affordable housing communities, market -rate properties, properties serving persons with mental and physical disabilities, people living with AIDS, as well as an assisted living facility. Our 5,000 plus units are located in 3 states in the Upper Midwest: Minnesota, Iowa and Wisconsin. CommonBond's property management department oversees all financial, Section 8 and 42 compliance, site and corporate maintenance, provides capital planning and construction management, and develops and implements marketing programs for the portfolio and fee managed properties. It employs the largest number of employees and generates a revenue base for CommonBond. CommonBond uses the nationally recognized. Yardi software system. The Yardi Voyager platform is a web -based system that integrates all fmancial reporting, property management and subsidy compliance. The Yardi "dashboard" clearly defines the workflow for the end user and provides real time information for both the regional and site staff. 7.) Would you add any services to what exists or continue as is? CommonBond is a nationally- recognized leader and innovator in the affordable housing industry. It was one of the first housing providers to include services for residents — Advantage Services — in its properties and to insist that its housing be a long -term asset to the surrounding neighborhood, Engagement with the local community has long been a ConunonBond hallmark. We have demonstrated that quality affordable housing combined with onsite services can transfonn lives and communities. Page 6 Value is added to our housing when we support our residents who live in CommonBond housing communities with on -site resources, programs, and services. This is accomplished by our resident services department, Advantage Services, through our technology -based Advantage Centers. By combining an affordable home with on -site supportive services, families have a stable foundation from which they can pursue the resources to move to market -rate housing or homeownership; children can succeed in school; and senior citizens and people with disabilities and other barriers to self - sufficiency can maintain their independence. The impact of Advantage Services is measured by specific objective outcome benchmarks and subjective criteria such as resident satisfaction with programs and services. Annual goals are detennined at the beginning of each fiscal year based on the current youth and senior services strategic plans, current economic climate, industry standards, expressed needs and interests of residents and funding requirements. Outcomes are measured in three main areas: 1) resident stability, advancement and independence; 2) financial performance of properties; and 3) community engagement. CommonBond's staff and volunteers provide individual services and on -site programming that address resident needs, connect them to available resources and build community. Computer labs are an integral part of each Advantage Center and provide technology -based resources that foster resident success. Core programs include the following areas: Individual Services Advantage Services Coordinators provide counseling for problem- solving and social and mental health support as well as referrals to existing community resources. They are available on -site to assist all residents in stabilizing their housing, accessing community resources, and advancing toward self - sufficiency. Assistance is available to address financial, medical, mental health, family, school, parenting, language, employment or other needs/interests/challenges. Career Advantage is an individualized professional career development program for working age residents that helps them to develop work - readiness skills, obtain and maintain employment, build careers through advancement, and achieve their financial goals. The individualized program focuses on work readiness preparation, occupation- specific and soft skills training, job shadowing and internship opportunities, job placement with partner employers, job retention, advancement support, and financial education and coaching to build assets. Child and Youth Programs offer early childhood education and after- school tutorial and academically focused mentoring programs for at -risk, high -need youth residents designed to increase academic performance, advance regular school attendance and promote parental involvement in education. These educational programs provide safe and supervised after - school and summer activities, youth intervention and diversion programs, recreation and socialization, and the promotion of mutual respect and community responsibility within the housing environment. CommonBond Advantage Services Coordinators are skilled at helping individual residents cormect with community resources and groups of residents to farm effective resident associations. Program Coordinators can work with volunteers and community -based agencies to create meaningful learning opportunities including English Language Literacy, health and wellness services and computer skills for residents. Staff is responsible for maintaining the financial and physical condition of the properties through top - quality management, maintenance, accounting, administration and asset management expertise. ZM Senior and Disability Services are focused on maintaining independence and preventing early nursing home placement. Each community offers resource centers that include computers, information and referral and community services. We are piloting the use of a rapid risk assessment along with core strength training and fall prevention services. T here is an additional focus on personal enrichment through lifelong learning, which includes the use of computer labs offering persona, business, and educational applications as well as the Internet. Working with home healthcare agencies, quality health care services designed specifically for the needs of senior residents are also provided. Regularly scheduled wellness and prevention services are offered onsite. Services include health promotion and foot care clinics, blood pressure screening, flu shots, exercise /strengthening classes and wellness classes and discussion circles. Advantage Services at Parkview Villa will include a configuration of the Senior and Disability Services described in the paragraph above. With the amount of community space at Parkview, we plan to carve out an Advantage Center that will house Advantage Services staff and a computer lab which will be open to and accessible for all residents. Certainly, initially, an Advantage Services Coordinator (typically a licensed social worker) will be assigned to provide individual services for residents. The main goal for having an on -site Coordinator is to support the aging resident population to maintain their independent living status for as long as possible. The Coordinator will conduct a thorough needs assessment of the resident population, and, based on the results of that assessment, introduce a customized configuration of programs and services for the resident population and location, in addition to service coordination, that may include: • health/wellness programming (we have a Wellness Coordinator who provides evidence -based exercise and wellness programming at many of our sites); • computer instruction and facilitation of open computer lab; • organized educational/social events and; • establishing relationships with local external healthcare providers that would come on -site to provide services such as mini health clinics, foot care, and in -home services; • intergenerational programming; • starting and/or sustaining a resident association 8.)The HRA desires to have parties submit a proposal regarding purchase price for both buildings. It is understood that this pricing proposal will be general in nature, and will serve only as a starting point for negotiations since the type of programs, interest rates, HUD approval requirements, HRA goals, etc. may all have a impact on the initial purchase price quote. Our proposed purchase price framework is attached. We have prepared a detailed financial analysis based on historical operating performance and industry standards. There are, however, certain unknown factors, including the potential for higher rents under a TRA scenario. The current rents do not support a substantial purchase price offer, however if higher contract rents could be established under TRA, we would explore the potential to increase our purchase offer accordingly. DOM CommonBond's purchase proposal would include a pass-through arrangement to provide ongoing n - T-Mobile antenna revenue to the LIRA for the lifetime of the cell tower lease. The total anticipated offering price for both properties is approximately $872,000, based on the current rent structure, and contingent upon receiving a commi burient '11 Om HUD for ongoing rental assistance. Further due diligence would be needed to refine these assumptions, including the assessment of future capital needs. If the proposed TRA legislation is enacted and allows rents to Oro up to or beyond FMR, the 1 0 offering price would be adjusted upward accordingly. Attachments: 1. Purchase Price Analysis and Proposal 2. 2010 CommonBond Annual Report 3. CommonBond Real Estate Portfolio 4. CommonBond Demographics 5. CommonBond Organizational Chart rOINFUSIFIMM =I- 7. ULI Housing with Heart article 8. HUD Fiscal Year 2012 Budget Summary — Transforming Rental Assistance 9. 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Ive I. - .1 8 00 N o 9 c NNNN "N N" a < O < i �i cIt n E�l go 5 C) Z Z z 2 I <,s 3:§ uj 11 LU 8 o O ci O 0 u LU 00000000 0l M O , W Z z a c w w It W ,u 2 0 0 L) m ar co z 50: N E E - W > > -a E W w It U) 0 LL m ms . to uj tL 0 w W is O < i �i cIt n E�l go 5 C) Z Z z 2 I <,s 3:§ uj 11 25 aeon. Homes for Generations March 18, 2011 Mr. Scott Clark City of Columbia Heights 590 40 Avenue N.E. Columbia Heights, MN-1 55428 Dear Mr. Clark: Aeon is pleased to submit its Statement of Qualification for the Purchase of Parkview Villa North and South. We are excited about the opportunity to bring Aeon's quality housing services to the residents of Columbia Heights and to build a strong new relationship with the City. Aeon's commitment to provide long term high quality affordable housing and combined with out technical expertise enable us to be an effective partner to the City of Columbia Heights as it seeks to achieve its goals for the future of Parkview Villa North and South. Aeon is a housing provider widely recognized for the creativity, dedication, and technical skills we bring to our work in the development and ownership of affordable housing in the Twin Cities. This is demonstrated in part by our ability to leverage funds from multiple streams; Aeon has raised over 1250 million in capital dollars alone over the last 25 years to support out development activities. There are multiple sources of funding in every project we undertake, a testament to both the abilities of our staff to manage complex projects and of the confidence our fenders have in Aeon. In addition to our staff's proven capacity to manage complex housing projects, our positive -working relationship with U.S. Department of Housing and Urban Development (HUD) will help to facilitate the transition of Parkview Villa North from its current PHA status to private ownership. Aeon has both deep and broad experience with HUD programs,, and sophisticated staff capacity to assess and work through HUD regulations. To further our technical expertise with the dissolution process, Aeon has retained the services of Reno & Cavanaugh, PLLC including partners Megan Glasheen and Efrem Levy, attorneys who specialize in matters regarding HUD (and PHAs in particular) with relevent success with the dissolution process. Aeon views itself as a community resource., Our projects are designed to implement the goals of each community in which we work. We look forward to working with the City of Columbia Heights and its residents to ensure that Parkview Villas continue to provide a high quality, safe and affordable place to call home. Thank you for your consideration of our request. Please don't hesitate to contact me if you have any questions about our submission (612-341-3148, ext. 204). 822 South 3rd St, Suite 300, Minneapotis, MN 55415 612-341-3148 612-341-4208 F www.aeonmn.org March 17th, 2011 Following up on our conversations regarding Parkseiew Villa North and South, Catholic Charities is interested in continuing to look at the possibility of partnering A IJ . with aeon to provide on-site services to residents. Our work is focused upon P " ' t" " „ helping seniors continue to live independently in their current homes. A partnership Ps„t_-.t,a > W t between Catholic Charities and Aeon could reinforce Aeon's mission to create homes for residents, as well as allow more Columbia Heights residents to remain in •c,. r,• ., their community. Catholic Charities Senior Care Management staff have the ability to provide needs assessment for each resident, on -site case management, coordination of care with medical and other service providers, and referrals to other community resources for seniors. In addition, Catholic Charities may be able to contract with Anoka County to provide other direct services to residents. Catholic Charities does not charge residents for its services. Our costs are covered through contracts with County governments, or reimbursed through medical assistance programs. There would be a need to raise additional funds to provide services to all residents. We understand that Aeon and Catholic Charities would jointly seek out additional funding to develop a comprehensive resident services program on -site if plans were to go forward on working together. We are interested in further discussions about the possibility of working together. Sincerely, .c, �� ._ i jai 4.1.S 1\ ary Ann Sullivan Director of Family Services Catholic Charities "I Villa Parxview Statement of Qualification March 18, 2011 ��,� �� Ill �» p Match 17t1 2011 lfs.Annc Heitlinger Senior Developer Aeon 822 3rd Street, Suite 300 Minneapolis, LAIN 55415 CATHOLIC Re: Parkview Villa North and South CHARITIES nj SIJ1.0 Ms. Heitlinger: Following up on our conversations regarding Parkview Villa North and South, Catholic Charities is interested in continuing to look at the possibili" of partnering A - with Aeon to provide on-site services to residents. Our work is focused upon 1'76 L- helping seniors continue to live independently in their current homes. A partnership "It 455 " "'t between Catholic Charities and Aeon could reinforce Aeon's mission to create ,I., V-31 homes for residents, as well as allow more Columbia Heights residents to remain in ,-,-[ : .(1 their community. Catholic Charities Senior Care Management staff have the ability to provide needs -assessment for each resident, on-site case management, coordination of care with medical and other service providers, and referrals to other community resources for seniors. In addition, Catholic Charities may be able to contract with Anoka County to provide other direct services to residents. Catholic Charities does not charge residents for its services. Out costs are covered through contracts with County governments, or reimbursed through medical assistance programs. There would be a need to raise additional funds to provide services to all residents. We understand that Aeon and Catholic Charities would Jointly seek out additional funding to develop a comprehensive resident services program on-site if plans were to go forward on working together. We are interested in further discussions about the possibility of working together. Sincerely, Mary -Ann Sullivan Director of Family Services Catholic Charities 1. Are the HRA goals workable or are modifications necessary to make the process more realistic: The goals established by the City of Columbia Heights HRA are prudent for meeting resident needs and clearly articulate the desire to provide the HRA with financial resources from sales proceeds to support further community reinvestment. Maintaining low rents while maxiinizmg the sale price will require creative financing options and all open-minded approach to balancing goals that may at first seem incompatible. Aeon will create scenarios for the HRA to evaluate and will assist in prioritization. Aeon is confident that a collaborative, workable solution can be reached for Parkview Villa residents, the HRA, and Aeon. HRA Goals: a) Maintain the property as a strong and vibrant community Yes. Aeon's mission is to create and sustain qiiafity affordable homes that s1repi I lives li and ,gt I)S 11 coivfllunilies. This is a -philosophy that is the core of Aeon's work. b) Protecting the existing rental price points for a particular period of time Yes. There are several options to explore that will protect the current rent levels. Aeon goal is aligned with the HRA's goal. c) A long-term covenant of maintaining the property as senior Yes. It is Aeon's intent to continue to operate the property for seniors. d) Need for the sale to be at market price Yes. Aeon is prepared to submit a workable ffinancmig package that includes a fair market value that considers the property's affordability goals and rent restrictions. We understand that the HRA can re- invest sales proceeds back into Columbia Heights. Aeon will work to resourcefully balance and maximize, to the greatest extent practical, the affordability goals and sale price. e) Maintaining a Columbia Height's residency priority Yes. We will 111stitute a priority preference for Columbia Heights residents within die guidelines of Fair Housing practices. g'. aeon Parlwiew Villa: Statement of Qualification-3 2. Describe your overall organization (size, assets, mission statement, organization management and ownership experience). Overview: Creating and sustaining affordable homes is at the heart of all Aeon endeavors. For Aeon, "home" is not simply four walls with a roof or a place to sleep; home is a place that is stable, safe, and healthy — shaped by the people who live there and the community -around it. Over the past 25 years Aeon has achieved excellence in: 1. Commu nity Revitalization and Affordable L providing a critical community re- ni _g: pr development service, transforming blighted and abandoned properties into quality apartment homes and i to i g the livability of neighborhoods and residents; IMP vin 2. Empowering Residents: helping residents build connections, become engaged in the conitnunity, and achieve stability in their lives; and, 3. Stewardship: managing assets to ensure properties remain a valuable conin investment for generations to come. Vision and Mission: Aeon's vision is that ei)egperson has a hole and is interconnected within co; Its .mission is to create and sustain quality affordable honyes that strengthen fires and colvwunifies. History Incorporated 111 1986, the organization began as a grassroots effort to replace housing lost when the Minneapolis Convention Center was constructed. In 2003, Aeon expanded outside its primary focus area of downtown Minneapolis into the entire 11-county Twin Cities Metropolitan Area. Today it has properties in Minneapolis, St. Paul, Roseville and Chaska. Assets: Aeon owns and maintains 1,785 apartments at 33 properties - more than $160 million in co n- i t nu nity assets. Our portfolio is Vvide-ranging, and 'includes affordable apartment homes, .nixed- income developments, and mixed -use projects with over 40,000 square feet of neighborhood scale commercial retail. Resident Profile: Aeon serves a diverse resident population of nearly 3,000 people meeting the needs of residents with very low incomes as well as those with relatively higher incomes. We have demonstrated our ability to provide homes to a variety of ages, including senior citizens, disabled, non-native speaking populations, families with children, and formerly homeless ' Parkview Villa: Statement of Q uali f ication 4 adults and youth. We are currently partnering with the city of Chaska to develop a senior property in their downtown area. Aeon is highly trained at working with diverse populations with varied needs, from modest to severe. For example, Aeon manages over 500 apartments for households who have experienced chronic homelessness. We have had great success in providing homes and stability to the most vulnerable populations, many with mental health challenges, including 76 apartments for homeless youth. Aeon is exceptionally skilled at understanding resident needs and can develop programin-mg and service plans that will allow even our most challenged residents to thrive. We have no doubt that we will be able to accommodate the needs of the senior and disabled population at Parliview Villa. Aeon has two models to provide services and resources to our residents. The first is through our internal Resident Connections team, who works closely with our property management staff to pinpoint opportunities for group-focused activities (such as resident picillics and workshops relating to topics such as budget management), and individual support when a resident many need very specific assistance to support a health or other personal situation. Aeon will also partner with third-party service agencies to provide regular activities or case management to populations who need a greater degree of support. For instance, our properties for formerly homeless households often have 24-7, on-site case managers and front desk staff Aeon closely evaluates each property and population for the right type of support. Key Strengths... Why Aeon? Any developer can provide four walls and a roof, but to create Home requires more than bricks and mortar. What differentiates Aeon? ® A Solid Partner: Aeon has built enduring, loyal relationships with its funders, partners, and most importantly, our residents. We have an excellent reputation and have earned the trust of many. Aeon has the skills and capacity to assemble the most experienced and talented project teams that can deliver expected results. Aeon is honest and transparent with our work. We have 'included references and a letter of support (snore are coming) for your review. Blending Creativity with Practicality: Aeon is known as an entrepreneurial organization that can conquer the most challenging and daunting problems. We are often asked to undertake projects that others have found to be insurmountable. Creative, yet realistic financing is at the core of our work. Most of our projects require navigation through bureaucracy, policy, political sensitivities, and multi- layered governmental organizations. Though we often find ourselves on the leading .,,.,,aeon. Parkview Villa: Statement of Qualification 5 edge, blazing a trail. not yet explored, we are grounded in practicality and understand the importance of bottom Ii-ne results. Quality and Sustainabili Aeon approaches our work with sustai-nabilitv in m ind. Physical (including elivirontriental), financial and social sustaiability is analyzed for every project. When we build, renovate, or manage, we do so with future generations in mind. Aeon constructs or renovates sites according to smart, livable design and high sustainability standards. It invests mi materials and uses methods that provide for the long-term durability of a building, and financially structures developments to support lower operations costs, sufficient operating revenue and project reserves to provide proper building man''itenarice. Comrnuni1y and Resident Eiioa opportunities gennent: Aeon assesses the needs and opporm es i i of a community and aligns our work with area plans and resources. Staff engages 111 dialogue with our residents and neighbors to discuss a project. We recognize the importance of building strong relationships and having open corninutucation. with our neighbors to contribute to meeting greater community needs. Aeon's Resident Connections staff links our residents to resources, and when needed, Aeon enlists the support of third-party social service partners to provide additional support. Size: Aeon is the largest nonprofit affordable housing provider in Minneapolis and the second largest in Minnesota. Aeon has 106 employees (including property management). Aeon's portfolio includes 1,787 Limits in 33 properties. Organzation Management: Aeon has an experienced core leadership team focused on the vision, mission and values of the organization, while being dicipilined managers of our financial resources. Attached is information about Aeon's leaders , key property management staff, and housing development team. # � Every property that Aeon acquires or develops is meant for long term ownership and management. Aeon staff think in terms of 100-150 years when designing, constructing, and managing out properties. Aeon has never sold a property that it has developed and has a philosophy against doing so. We become true community partners in every area where we operate our properties — we invest in our shared communities for the long-term. • Parlwiew Villa: Statement of Qualification 3. Describe your organization's relevant experience in working with HUD? Sil'icc our inception, Aeon has been working with the US Department of Housing and Urban Development (HUD). Aeon has both deep and broad experience with HUD programs including HOME, CDBG, Section 8, FHA mortgage financing (221 d 4, 221 d 3 223 f, etc.), Mark to Market, and Uniform Relocation Act, and more. As such, Aeon has sophisticated staff capacity to assess and work through HUD regulations and guidebooks. We have positive and productive relationships with local HUD, PHA, and HRA staff in the metro area. We have an excellent record regarding compliance with HUD regulations for housing development and management. We are proactive in working witli local and national legal counsel to advise us on complex technical matters that may arise 'in working through various HUD programs. Some notable examples of our work with HUD *include: our ability to convice HUD staff to remove a scheduled property from their foreclosure sale process, and allow us to purchase it for $1. It was neither easy or quick, but we were able to secure and stabilize a notorious property that had been an ongoing community concern. The foreclosure process had very little promise of putting the property in the hands of a experienced and committed owner. We were focused on breaking the cycle of this problem property. It is now a community asset that serves 30 of our families. providing HUD -with information and risk mitigation that allowed them to underwrite and finance 7,500 square feet of commercial space in our Clover Field Marketplace, mixed-income and mixed-use housing development 111 Chaska. The city felt strongly about maintaining the commercial space while HUD was against it. The project would. not have been financially viable without HUD's support and financing. We were able to promote a solution where the city would participate as a guarantor of the commercial revenue. HUD accepted this resolution and the deal moved forward. This was an unconventional approach for both the city and HUD, and is a fantastic example of creative partnerships. 4. Describe why your organization views that they can be successful in working through the special application process that will be required to convert the Public Housing Agency status. Aeon will be a productive and valuable partner with the Columbia Heights HRA in working through the HUD special application process and transition the property from the HRA to Parkview Villa: Statement of Qualification 7 Aeon. Aeon has significant experience in researching and understanding arcane policy and program guidelines, assembling complex application materials, as well as creating clear and compelling applications. We are unaftaid to ask important questions and push the envelope with new and creative ideas. We arc skilled listeners and will work to find a solution that will best achive multiple goals and agendas that are part of every project. To enhance our technical expertise with the dissolution process, Aeon has retained the services of Reno & Cavanaugh, PLLC including partners Megan Glasheen and Efrem Levy, attorneys who specialize in matters regarding HUD and PHA with relevent current success with the dissolution process. Reno & Cavanaugh will advise us in assessing the options for disposition—how to achieve both the HRA's goals of transferring the properties in way to reduce the HRA's responsibilities as well as Preserve P-Arkview Villa North and South as high quality affordable housing for the long term. Reno & Cavaugh has significant experience with HUD PHA dispositions and mixed finance transactions, as well as knowledge of Minnesota through ir work as counsel to the Minneapolis Public Housing Authority. 9 11, 1 Additional information on Reno & Cavanaugh's experience and the specific attorneys Aeon has consulted with are attached. If Aeon is selected, Reno & Cavaugh would continue as our counsel on this project throughout the sale and disposition process. 1 5. To maintain the goal of subsidized housing, what programs and/or financing woul you attempt to put into place? Aeon has a successful track record of partnering with Public and private funders. Aeon has raised over $250 million in capital dollars over the last 25 years to support our development activities, ranging from supportive housing projects for homeless individuals, workforce and market rate housing, neighborhood scale commercial space, and public improvements. There are typically ten to thirty sources of funding in every project we undertake, a testament to both the abilities of our staff to manage complex projects and of the confidence our funders have in the organization. To meet the city goals of a vibrant community while maintaining affordability, we have I begun to explore several different funding opportunities to determine the most advantageous financing package, including: • HUD – preservation of existing PHA operating subsidy • HUD – conversion of existing PHA. operating subsidy to project based housing vouchers • HUD – FFIA insured mortgage program • Minnesota Housing Finance Agency - first mortgage financing (LMIR) and preservation funds (PARIF) Parkview Villa: Statement of Qualification 8 • Anoka County - HOME Program funds • City of Columbia Heights — Tax Increment Financing • Private Equity from the syndication of 4% low income housing tax credits via tax exempt bonds • HUD —Section 811- Disabled populations It will be critical to secure public funding partnerships with agencies such as HUD, Minnesota Housing Finance Agency, Anoka County and the city of Columbia Heights to maintain the existing level of affordability for the long-term and reasonably maximize the sale price. Many of these funding sources require long term covenants and income and rent restrictions to ensure affordabilitv for extended periods. The typical covenants are recorded declarations that are in effect for 20 to 30 years. Please see question 8 for additional information about financing and variables. 6. Would you contract management or do it through your parent organization? Aeon would conduct the property management through Aeon Property Management, LLC. Aeon Management LLC has over 65 employees, and it currently manages 1,787 units. Each property has a site manager, caretaker and maintenance staff. It is a wholly owned subdivision of Aeon. Aeon Management, LLC, prides itself on properly screening residents to determine the ability of the resident to succeed at the property. Criminal background, housing history, and credit checks are part of die application process for all residents. Though all residents sign a lease with significant detail, Aeon expects our residents to generally do three things: 1. Pay d-ieir rent: whether it is subsidized or market rate, rents need to be paid so that we can properly maintain the building. 2. Respect neighbors in and around ffie property: it is our intent to provide a safe and 'inclusive living experience. 3. Respect the property: we plan on operating and maintaining a quality home for generations, and cannot afford to have residents who purposefully damage the space. Some of our residents may not have the capacity to do these three on their own, such as our homeless youth residents. Aeon Management then determines if we have the resources and capacity to provide appropriate services to assist the resident in acl these three requirements. If we can, it is likely that the resident will be accepted.. If we cannot, we Qualification 9 Parkview Villa: Statement of Qualf aeon. determine that the property is not a good fit for the resident. We are responsive and accountable if and when a problem arises. Aeon Management LLC is comprised of experienced proper management professionals who property ty have been III the industry for manv years and have expertise in manazina affordable and supportive housing, as Well as market rate apartments. Please see the attached, brief biographies of key property management staff 7. Would you add any services to what exists or continue as is? Services and resources will be considered as we conduct a thorough assessment of resident needs and desires. As part of the opportunity to purchase Parkview Villa, we have discussed the possibility of a service partnership with Catholic Charities. Catholic Charities is interested -U*'l being considered a service partner for the resident of Parkview Villa, should Aeon be selected. Aeon will also consider other service providers and the potential of engaging our Resident Connections staff. Early analysis suggests that we would continue to welcome the Volunteers of America Oil- site meal program. We have approached Catholic Charities about partnering to create all on- site program with individual assessment, case management, referrals, and coordination of service providers. The Catholic Charities Senior Care Management Program works to keep residents living 'independently 'in their current homes. Catholic Charities' practice is that residents would not be charged for services. Catholic Charities receives payment through medical assistance programs and contracts with County governments. Additional funds would have to be raised to cover a portion of the program's costs. Aeon and Catholic Charities would work Jointly to secure full funding. The Catholic Charities Senior Care Management Program provides: • comprehensive in-home assessment to create an individualized care plan • referral and coordination of services in all areas of a resident's life • advocacy on behalf of the program participant • close collaboration with other service providers ® reevaluation of service needs on a regular basis to meet changes in person's life The service provider would need an office, and Aeon staff has initially identified a storage /mechanical room that could be converted into an office space. It may also be worthwhile to evaluate the opportunity to share the space that is currently occupied by the beauty shop. at Parkview Villa: Statement of Qualification 10 Rents at Parkview Villa North, without the rental subsidy, are averaging 17% of the Area Median Income (AMI) while rents at Parkview Villa South are averaging 35% AMI. These rents meet HUD's definition of very low and very, very low income households. The purchase price will be a function of several financial variables related to the existing project financials and proposed new financing. The goal will be to address all variables to reach an acceptable purchase price and support the long -term affordability and sustainability of Parkvie Villa. Aeon will likely combine the two properties under one new financing package, though we will examine the pros and cons of separate financing strategies. For the purpose of this RFQ, we will assume the combined strategy. In addition, there could be a one or two phased approach, each with its own set of strengths and weaknesses. The following section provides some very preliminary assumptions about sources and uses to give the HRA some insight to the variables and possibilities that will influence HRA goals. These assumptions and amounts are meant for discussion purposes only and will need further investigation and refinement. Project Sources: The following section provides additional details regarding the variety of potential financial sources to fund the refinancing and recapitalization of Parkview Villa North and South. Actual amounts and details will be refined during further underwriting and due diligence: A. First Mortgage Financing The new first mortgage amount will vary depending on the Net Operating Income (NOI), and the terms of the new loan. Aeon will seek credit enhanced mortgage options through the HUD FHA program, Minnesota Housing Low - Moderate Income Rental program, and a few other programs. It is important not to over - leverage the property, but to maximize the debt it can reasonably support. A closer examination of opportunities to increase the NOI will be important. Revenue: A critical component will be to maintain the current rents that the residents pay so that they do not face economic hardship. It is of significant importance, at a iminimum, to maintain the current HUD rental assistance of $375,000, or the NOI drops significantly and the market value substantially decreases. Parkview Villa: Statement of Qualification l I An optimal solution would be to convert the HUD rental assistance to Section 8 Project Based Assistance, which would add roughly $200,000 to the annual operating revenue, assuming that rents could be increased to Fair Market Rents, though resident contributions would remain the same. TI - Lis, will boost the propervY value and increase the mortgage to an appropriate level, while providing capital to support a stronger purchase price. Aeon has had preliminary conversations with our legal staff related to this opportunity. Expenses: Aeon is considering viable opportunities to decrease the operating costs, primarily through the decrease in utility costs by installing energy efficient ffxtures and low -flow water devices. There will be an initial capital cost, however, the payback will be short and cost savings will be realized. This will promote conservation and decrease expenses. The end result will improve the NOI, support a stronger first mortgage, and reach the bottom line purchase price. B. Second Mortgage Financing: We understand the project does not pay property taxes. Property= taxes are estimated at approximately $100,000. Aeon proposes that we consider the increment between today's taxes and the future taxes to utilize the Tax Increment Financing program to capitalize a second mortgage. C. Referred Debt: As mentioned in Section 5, there are several options obtain capital in the form of deferred debt. It will help pay for project costs, while deferring principal and interest costs for 30 to 40 years. Likely prospects are Minnesota Housing, Anoka County, and the HUD 811 program for disabled residents. R. E ui : A potential refinancing source could be housing revenue bonds combined with the 4 % low income housing tax credit program. Aeon has strong relationships with tax credit syndicators and direct investors who could be the limited partner to provide project equity. Project Costs - Uses: A. Rehabilitation and Energy Retrofits To successfully refinance this project, lenders and limited partners will expect to see a renovation plan that -will ensure that there are no major capital improvement issues for 15 to 20 years. Many of the programs require an investment of approximately $20,000 per unit to give the lenders confidence that major systems and building components are addressed. A capital improvement assessment of all major systems and unit interiors will need to be conducted to assess the capital. needs 6 y awn. Parkview Villa: Statement of Qualification l of Parkview Villa. There are also financing programs to help pay for energy efficiency retrofits and water conservation updates. B. Professional Fees (legal, architectural, accountant), Feasibility Analysis, Due Diligence, Soft Costs, Developer Fee, Financing Fees, etc.: It is roughly estimated that the project will have approximately $8,000 per unit in non-construction related costs. C. Operating and Replacement Reserves: We estimate that combined project reserves will be approximately $2,700 per unit. D. Acquisition Price: Aeon expects to pay the appraised value for the property. For the purpose of t1--tis RI Q submission, we will estimate the value in two ways: 1. Applying a capitalization rate of 7% to the net operating income. (Note: current capitalization rates for this type of property range from 7% to 9% - Aeon is using the more aggressive rate for this calculation). 2. Aeon is calculating the acquisition price based on the possibility to obtain project sources that will cover the project costs (uses). We could not find reasonable, comparable sales to provide feedback on the proposed market value of this project. We will rely on the appraisal to determine appropriate comps. The following section will provide a range of purchase prices based on several scenarios. Preliminary Scenarios This section will synthesize project variables and is meant to provide the HRA with scenarios to consider. These scenarios are based upon discussions with Reno & Cavanaugh regarding the possibilities for converting Parkview Villa North to non-PHA status. Parkview Villa South is assumed to maintain current rent levels and operations. All prices 'include the purchase of both properties. Timing estimates are based solely on the time frame for the HUD disposition process once a transfer method is selected. The entire disposition and funding process will take longer. Parkview Villa: Statement of Qualification 13 Scenario 1—Disposition and Elimination of Rental Assistance * Process: Transfer the North building to a new owner and complete the disposition process removing the North building from the PHA inventory. * Timing: 90-120 days. Impact on HRA: HRA would have no further responsibility or involvement with Parkview Villa North. Impact on Property Operations: PHA operating subsidy would be lost, reducing revenue by $375,000, which is 55% of the revenue. This is not a viable option, as the project could not support a mortgage and would not have enough revenue to cover operating costs without increasing rents. • Impact on HRA Goals: Purchase price would be very low, Hlui would have no further responsibilities, North could not continue to serve the current population. • Sales Price Range – This would depend on increasing rents. We assume this is not a viable option. Scenario 2— Disposition with the Conversion to Section 8 Vouchers – increase to FMR rents, assume some utility cost savings Process: Transfer the North building to a new owner, and complete the disposition process removing the North building from the PHA Inventory. Secure Section 8 project based vouchers for the project to replace the loss of the PHA operating subsidy. Timing: 90-120 days for disposition and then 30 to 60 days to obtain Section 8. • Impact on HRA: To be determined. Either the Columbia Heights HRA could administer the vouchers or the HRA could enter into a cooperative agreement with Metro HRA or MHFA to administer the vouchers for the property. • Impact on Property Operations: Financial health would improve over time, as increases in the voucher payment standard generally exceed adjustments to PHA operating subsidies on a per unit basis. • Impact on HRA Goals: Purchase price would be higher. The HRA may or may not have further responsibilities. Housing could continue to serve the current population • Sales Price Range - $4 million to $5.2 million Scenario 3— Disposition with the Conversion to Section 8 Vouchers – increase beyond FMR to current Payment Standard, assume some utility cost savings * Process: Transfer the North building to a new owner, and complete the disposition process removing the North building from the PHA Inventory. Secure Section 8 project based vouchers for the project to replace the loss of the PHA operating subsidy. * Timing: 90-120 days for disposition and then 60 to 120 days to obtain Section 8. Parkview Villa: Statement of Qualification * Impact on HRA: To be determined. Either the Columbia Heights HRA could administer the vouchers or the HRA could enter into a cooperative agreement with Metro HRA or MHF A to administer the vouchers for the property. * Impact on Property Operations: Financial health would improve over time as increases in the voucher payment standard generally exceed adjustments to PHA operating subsidies on a per unit basis. * Impact on HRA Goals: Purchase price would be higher. The HRA may or may not have further responsibilities. Housing could continue to serve the current population * Sales Price Range - $4.6 million to $6 million Scenario 5 - Mixed Finance Transaction, assume some utility cost savings * Process: Transfer the North building to a new owner and apply to HUD for approval of the mixed finance transaction. The Nord building remains in the PHA Inventory. * Timing: 90 -120 days for disposition. * Impact on HRA: HRA would continue to receive the operating subsidy and transfer it to the new owner. HRA must ensure that statutory requirements are met by the new owner. * Impact on Property Operations: PHA operating subsidy would be retained, allowimg for operations to continue as they do now. HRA could also transfer Modernization or other capital funds to projects for property improvements. HUD requirement to maintain as affordable for 40 years. Impact on HRA Goals: Purchase price would be higher. HRA would continue to be involved with the property (but to a lesser degree). Housing could continue to serve the current population for the long term. * Sales Price Range —$1.9 million to $2.4 million nr Parlwiew Villa: Statement of Qualification 15 MMEMONM� Housing Development Staff Irm 0,14�eon. Park-view Villa: Statement of Qualification 1