HOUSING HOMELESS FAMILIES IN PASADENA

Colleen Edwards, Ujjal Ghoshtagore, Tish Glaser, Jimmy Miyoshi, Nancy Sagar, Archana Rajan, advisor Dale Yonkin

Welcome

The Problem (Ujjal)

Target Population (Nancy)

Site Selection (Colleen)

Design (Jimmy)

Services (Arch)

Pro Forma Financials (Tish)

Wrap-up (Ujjal)

Pasadena Trends

1017

879 853

1064

1001

825 836

1004

1137

1992 2000 2003 2005 2006 2007 2008 2009 2010

Nu

mb

er o

f h

om

eles

s in

div

idu

als

Homelessness is up 36% from 2008

Drivers

• Economic displacement

• Lack of affordable housing

• Decreased funding

71 Families, 262 Individuals

599

294322 262

0

100

200

300

400

500

600

700

2005 2007 2009 2010# o

f h

om

eles

s fa

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es

Family homelessness is dropping

81 99

3745

0

20

40

60

80

100

120

140

160

On the streets In shelters

# o

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om

eles

s In

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In shelters & on the streets

Parents

Children

Parents 82 (1.2 / family)

Children 180 (2.5 / family)

+ kids in foster care

Housing gap

500 families at risk

“The dire lack of affordable housing in Pasadena is both a leading contributor to the homeless crisis and a fundamental barrier to chronically homeless families to overcome their homelessness. ”

- Marv Gross, CEO, Union Station Homeless Services

14 units at Euclid Villa

50 beds at the Family Center

No PSH for families

Target population

Homeless families 71

"High need families with serious barriers to stability" x 25%

Qualified families today = 18

Future capacity + 12

Total units 30

75 children

36 adults

Profile: Mothers

Mental health problems

Substance abuse, self-medication

Domestic violence

Victimized

PTSD, depression, anxiety

Physical or developmental disabilities (31%)

3+ major health problems (62%)

Unable to get medical treatment

Pregnancy (7%)

Limited life skills

Limited financial stability

Poor support system

Distrustful

Limited parenting skills

Abusive behaviors

“Many of these people were born into poverty. They have suffered abuse and self-medicated, sometimes when they were kids. It’s not an accident that they’re homeless. It’s a wonder they weren’t homeless earlier.”

- Marv Gross, CEO, Union Station Homeless Services

Trauma has lifelong impact

Mental health disorders

Behavioralproblems

Learningdisabilities

Greater illnessthan “housed” children

Social & emotional delays

Foster care placement

Enrolled,52%

Not enrolled,

48%

48% of homeless children aren't enrolled in school

Children often experience terrible family violence

Requested Area: Colorado Blvd

Plan A: Best Western Inn

Asking$9.8 million

Plan B: La Pasada Inn

24 feet too close to the highway

Disqualified from City of Industry funding

Plan C: 3620 E. Colorado

18,870 sq ft

9,435 sq ft

Elizabeth Carniceria

Apartments

Adjacent Property

Amenities • Colorado/ Lotus bus stop

• <1 m to Ralph’s

• <½ m to Pasadena City Library

• <¾ m to Eaton Blanche Park

• <½ m to Wilson Elementary School

• <½ m to Wilson Middle School

• <2 m to many retail businesses

Services

“They say they will participate in services, but they don’t. You must remove all barriers for their participation.” – David Garcia, Pacific Services

Onsite ServicesC

ase

Ma

na

ge

me

nt

Substance abuse counseling

Benefits assistance

Mental health care and counseling

Trauma-specific counseling (including sexual abuse and physical abuse) O

nsi

te W

ork

sho

ps

Living Skills

Money management

Emotions management

Healthy relationship skills

Legal Info

AIDS/HIV education F

am

ily

/Ch

ild

Se

rvic

es

Parenting Classes, Family Therapy, Child Care

Group Activities

Food Pantry, Transportation

Creativity building

Legal/Juvenile support

Referrals

Property Management

Strong Partnership = Successful PSH

Onsite Property Manager

Case Managers

Tenant Qualification

24 hour onsite Manager

Annual Reporting

Case Management

Tenancy Agreement

Low Control

Onsite Workshops

Family/Kids Services

Educate

Engage

Enhance

PSH

For Families

Local Residents

Local Schools

Local Businesses

Community OutreachEducate

Disperse

Fears, misconcepti

ons

Engage

Bus tours

Volunteering

Student Internships

Enhance

Events, Art

projects

Story time for kids

Educate

New Neighbor on

the block

Engage

Discuss Needs

Of residents

Enhance

Provide Business

Set up Contracts

Educate

Project Briefing

Engage

Fund raisers,

Events

Enhance

Refer homeless

To suitable home

Educate

Benefits to City,

Children, Families

Engage

Direct involvement

for political support

Enhance

City Projects

participation by

PSH residents

Educate

Psychological

effects of

homelessness

Engage

Obtain help to spot

homeless families

Enhance

Kids events

Nonprofits, City Departments

City Officials / Political Support

Build Community Support – Educate Engage Enhance

Educate

Engage

Enhance

Sources & Uses

Threshold Basis

Calculation

Pro Forma Income & Expense SummaryFamily / 9% Tax Credits

Los AngelesRent @ 100%

AMIUtility

Allowance0 $904 $01 $1,145 $612 $1,430 $803 $1,920 $0

Beds Baths Sq. Ft. /Unit# of Units % of AMIRent/

UnitUtility Allow.

Rent Received

Monthly Rent Subsidy

Affordable Units1 1 510 15 30% $445 61 $384 $5,760 $11,4152 1 750 14 30% $535 80 $455 $6,370 $13,650

Affordable Units Subtotal 626 29 30% $488 $70 $418 $12,130 $25,065

Market Rate UnitsManagers Unit

2 1 750 1 100% $1,430 $0 $1,430 $1,430Market Rate Units Subtotal 750 1 $1,430 $0 $1,430 $1,430

Total for All Units 630 30 $520 $452 $13,560

Total Annual Rent $162,720Other Income $5.00 $1,800Rent Subsidy $300,780

Vacancy 10% $(46,530)

Effective Gross Income $418,770

15-Year Cash Flow Projection

Family / 9% Tax Credits

Inflation 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Rental Income 2.5% 162,720 166,788 170,958 175,232 179,612 184,103 188,705 193,423 198,259 203,215 208,295 213,503 218,840 224,311 229,919

Other 2.5% 1,800 1,845 1,891 1,938 1,987 2,037 2,087 2,140 2,193 2,248 2,304 2,362 2,421 2,481 2,543

Operating Subsidy 2.5% 300,780 308,300 316,007 323,907 332,005 340,305 348,813 357,533 366,471 375,633 385,024 394,649 404,516 414,629 424,994

TOTAL GROSS POTENTIAL REVENUE 465,300 476,933 488,856 501,077 513,604 526,444 539,605 553,095 566,923 581,096 595,623 610,514 625,777 641,421 657,457

Vacancy @ 10% 3.5% 46,530 47,693 48,886 50,108 51,360 52,644 53,961 55,310 56,692 58,110 59,562 61,051 62,578 64,142 65,746

TOTAL NET RENTAL INCOME 418,770 429,239 439,970 450,969 462,244 473,800 485,645 497,786 510,231 522,986 536,061 549,463 563,199 577,279 591,711

Advertising 3.5% 3,000 3,105 3,214 3,326 3,443 3,563 3,688 3,817 3,950 4,089 4,232 4,380 4,533 4,692 4,856

Legal 3.5% 5,000 5,175 5,356 5,544 5,738 5,938 6,146 6,361 6,584 6,814 7,053 7,300 7,555 7,820 8,093

Accounting 3.5% 5,000 5,175 5,356 5,544 5,738 5,938 6,146 6,361 6,584 6,814 7,053 7,300 7,555 7,820 8,093

Other Administrative 3.5% 6,000 6,210 6,427 6,652 6,885 7,126 7,376 7,634 7,901 8,177 8,464 8,760 9,066 9,384 9,712

Management Fee 3.5% 25,126 26,006 26,916 27,858 28,833 29,842 30,887 31,968 33,086 34,244 35,443 36,683 37,967 39,296 40,672

Utilities 3.5% 15,000 15,525 16,068 16,631 17,213 17,815 18,439 19,084 19,752 20,443 21,159 21,900 22,666 23,459 24,280

Water & Sewer 3.5% 15,000 15,525 16,068 16,631 17,213 17,815 18,439 19,084 19,752 20,443 21,159 21,900 22,666 23,459 24,280

On-Site Manager 3.5% 33,000 34,155 35,350 36,588 37,868 39,194 40,565 41,985 43,455 44,976 46,550 48,179 49,865 51,611 53,417

Assistant Manager 3.5% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Maintenance Personnel 3.5% 8,000 8,280 8,570 8,870 9,180 9,501 9,834 10,178 10,534 10,903 11,285 11,680 12,089 12,512 12,950

Other Payroll 3.5% 7,000 7,245 7,499 7,761 8,033 8,314 8,605 8,906 9,218 9,540 9,874 10,220 10,577 10,948 11,331

Insurance 3.5% 9,000 9,315 9,641 9,978 10,328 10,689 11,063 11,451 11,851 12,266 12,695 13,140 13,600 14,076 14,568

Real Estate Taxes 2.0% 5,000 5,100 5,202 5,306 5,412 5,520 5,631 5,743 5,858 5,975 6,095 6,217 6,341 6,468 6,597

Painting 3.5% 5,000 5,175 5,356 5,544 5,738 5,938 6,146 6,361 6,584 6,814 7,053 7,300 7,555 7,820 8,093

Repairs 3.5% 5,000 5,175 5,356 5,544 5,738 5,938 6,146 6,361 6,584 6,814 7,053 7,300 7,555 7,820 8,093

Trash Removal 3.5% 10,000 10,350 10,712 11,087 11,475 11,877 12,293 12,723 13,168 13,629 14,106 14,600 15,111 15,640 16,187

Exterminating 3.5% 2,500 2,588 2,678 2,772 2,869 2,969 3,073 3,181 3,292 3,407 3,526 3,650 3,778 3,910 4,047

Grounds Maintenance 3.5% 6,000 6,210 6,427 6,652 6,885 7,126 7,376 7,634 7,901 8,177 8,464 8,760 9,066 9,384 9,712

Other Maintenance 3.5% 3,000 3,105 3,214 3,326 3,443 3,563 3,688 3,817 3,950 4,089 4,232 4,380 4,533 4,692 4,856

Elevator 3.5% 5,000 5,175 5,356 5,544 5,738 5,938 6,146 6,361 6,584 6,814 7,053 7,300 7,555 7,820 8,093

Case Management 3.5% 120,000 124,200 128,547 133,046 137,703 142,522 147,511 152,674 158,017 163,548 169,272 175,196 181,328 187,675 194,243

Service Amenities 3.5% 40,000 41,400 42,849 44,349 45,901 47,507 49,170 50,891 52,672 54,516 56,424 58,399 60,443 62,558 64,748

Operating Reserve 3.5% 8,136 8,421 8,715 9,021 9,336 9,663 10,001 10,351 10,714 11,089 11,477 11,878 12,294 12,724 13,170

Replacement Reserve 3.5% 18,000 18,630 19,282 19,957 20,655 21,378 22,127 22,901 23,703 24,532 25,391 26,279 27,199 28,151 29,137

TOTAL EXPENSES 358,762 371,244 384,161 397,529 411,362 425,679 440,495 455,828 471,696 488,117 505,111 522,699 540,900 559,737 579,230

Rent Reserves Payment 2,012 4,198 6,567 9,126 11,887 14,858 18,050 21,473 25,138 29,058 33,244 37,709 42,465 47,527

NET OPERATING RENTAL INCOME 60,008 60,008 60,008 60,008 60,008 60,008 60,008 60,008 60,008 60,008 60,008 60,008 60,008 60,008 60,008

DEBT SERVICE 50,007 50,007 50,007 50,007 50,007 50,007 50,007 50,007 50,007 50,007 50,007 50,007 50,007 50,007 50,007

Asset Management Fee 3.0% 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524 6,720 6,921 7,129 7,343 7,563

Partnership Management Fee 3.0% 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668 13,048 13,439 13,842 14,258 14,685 15,126

FORECASTED CASH AVAILABLE (4,999) (5,449) (5,912) (6,390) (6,881) (7,388) (7,909) (8,447) (9,000) (9,570) (10,157) (10,762) (11,385) (12,027) (12,688)

Debt Coverage Ratio 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20

Deferred Developer Fee Payment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Interest 3.0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Outstanding Fee $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Rent Reserves Balance 303,314 301,302 297,103 290,536 281,410 269,523 254,665 236,615 215,143 190,004 160,946 127,702 89,993 47,527 0

Tiny but positive!

Final Thoughts

Our approach is replicable, and our proposal helps families and children -- a logical growth area for permanent supportive housing.

Q&A

Thank you!

Best Western Site

Lot size (~ 1 acre) and structure (63 motel rooms) larger than needed Population study indicates ~ 30 units is right size Too large a project may alienate community, instead of

engaging it

$9.8 million asking price reflects value as a going concern Perhaps negotiable to 8-9 million, plus 1-2 million in

renovation -> total 9 – 11 million project cost Using 1.66 units per PSH unit -> 37-38 units, 25% more than

selected site

High acquisition cost is penalized in competitive loan applications; project unlikely to reach fruition

Too large, too expensive, too risky to finance

ComparablesAddress Size (SF) $ $/SF Comment

Dissimilar Properties

3731 Colorado

Blvd.2,500 $ 750,000 $300.00

1-story commercial building, small

lot

78 5,663 $ 1,295,000 $228.691- and 2- story commercial

building, small lot

3570 E Foothill 108,900 $ 3,100,000 $ 28.47 Large vacant parcel

Comparable Properties

2176 E. Colorado

Blvd.10,019 $ 1,950,000 $194.63 1- story commercial building

1837 E. Colorado

Blvd.19,166 $ 2,750,000 $143.48 Apartment building

Projected Purchase Price

Theoretical $/SF

Low16,000 $ 2,295,680 $143.48

Theoretical $/SF

High16,000 $ 3,114,080 $194.63

Average $/SF $169.06

Property details

Substandard apartments Adjacent property

2915 sq ft market built 1946

216 sq ft accessory building built in 1949

(8) 1-bedrooms @ 297 sq ft Total 2,376 sq ft, built in 1957

(8) 1-bedrooms @ 434 sq ft each Total 3,472 sq ft, built in 1954

(2) 2-bedrooms @ 581 sq ft Total 1,162 sq ft, built in 1924,

remodeled in 1948)

(2) commercial buildings measuring 2,000 & 2,520 sq ft

Built in 1932

C-3 Zone Summary of Entitlements

By-Right Density 50 Units/Acre

By-Right Units 21.7 units

Density Bonus 50% Density Incentive Unit

Count

32 units

By-Right Parking: One bedroom 1-1/2

spaces, two bedroom 2 spaces

At 14 one bedroom and 15 two bedroom units:

51 spaces

Density Bonus Parking Incentive: One

bedroom .75 spaces/unit, Two bedroom

1.5 spaces/unit

At 14 one bedroom and 15 two bedroom units:

34 spaces

Building Height Restriction 35’

Additional Density Bonus Incentive

Possibilities (3 allowed)

Additional 10’ of height OR up to 20%

modification from side yard/setback

requirement. Up to a 35% modification of front

and rear yard/setback requirements.

Required entitlement: Conditional Use Permit for apartment building

in a commercial zone

INNOVATION: Discretionary application to further reduce

parking