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Home My WebLink AboutC-6377(K) - Amendment to Loan DocumentsRECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Newport Beach Attn: City Manager 100 Civic Center Drive P.O. Box 1768 Newport Beach, CA 92660 WITH CONFORMED COPIES TO: Community Development Partners 3416 Via Oporto, Suite 301 Newport Beach, CA 92663 Newport Veterans Apartments LP c/o Community Development Partners 3416 Via Oporto, Suite 301 Newport Beach, CA 92663 Mercy House CHDO, Inc. P.O. Box 1905 Santa Ana, CA 92702 Aegon LIHTC Fund 52, LLC c/o AEGON USA Realty Advisors, LLC Attention: LIHTC Reporting Mail Drop 5553 4333 Edgewood Road NE Cedar Rapids, Iowa 52499-5553 Transamerica Affordable Housing, Inc. c/o AEGON USA Realty Advisors, LLC Attention: LIHTC Reporting Mail Drop 5553 4333 Edgewood Road NE Cedar Rapids, Iowa 52499-5553 Exempt from recording fees pursuant to Govt. Code section 27383 Assessor's Parcel Number(s): 045-114-15 Recorded in Official Records, Orange County Hugh Nguyen, Clerk -Recorder jj I j 111�1� jjjj II jj ILII jj�j jjj jjjj I jj I111 NO FEE *$ R 0 0 1 0 0 9 0 4 5 7$* 2018000177099 3:58 pm 05115118 37 416 A18 17 0.00 0.00 0.00 0.00 48.00 0.00 0.000.000.00 0.00 Space Above This Line For Recorder's Use Only AMENDMENT TO LOAN DOCUMENTS 14 ND bf,6Q Or— Amendment r— Amendment to Loan Documents Page 1 of 12 This AMENDMENT TO LOAN DOCUMENTS ("Amendment") is made and entered into on this lMay of May _, 2018 ("Effective Date'), by and between Newport Veterans Apartments LP, a California limited partnership ("Borrower"), and the City of Newport Beach, a California municipal corporation and charter city ("City"). Borrower and City are individually referred to herein as "Party," and collectively referred to herein as "Parties." RECITALS A. Community Development Partners, Inc., a California corporation ("CDP' entered into that certain Affordable Housing Agreement and Joint Escrow Instructions with City on December 14, 2015 ("AHA"). Pursuant to the AHA, CDP agreed to acquire, rehabilitate and operate as an affordable housing development a twelve (12) unit existing development ("Project's and City agreed to make a loan to CDP in the amount of One Million Nine Hundred Seventy Five Thousand and 00/100 Dollars ($1,975,000.00) ("Loan') to assist in financing the acquisition of the Project, as more specifically described in the AHA. B. CDP assigned all of its right, title and interest in, and duties and obligations under, the AHA to Newport Veterans Housing LP, a California limited partnership and Newport Veterans Housing LP, a California limited partnership accepted such assignment pursuant to that certain Affordable Housing Agreement and Joint Escrow Instructions Assignment and Assumption Agreement dated December 18, 2015 and recorded in the official records of the County of Orange on December 22, 2015 as document number 2015000645084 ("First Assignment Agreement'. C. City subsequently made the Loan to Newport Veterans Housing LP, a California limited partnership as evidenced by that certain Promissory Note dated as of December 18, 2015 in the original principal amount of One Million Nine Hundred Seventy Five Thousand and 00/100 Dollars ($1,975,000.00) executed by Newport Veterans Housing LP, a California limited partnership for the benefit of the City ("Promissory Note's and secured by that certain Deed of Trust with Assignment of Rents dated as of December 18, 2015 and recorded in the official records of the County of Orange on December 22, 2015 as document number 20150006450831-i ("Deed of Trust'. Additionally, as a condition of the City making the Loan, Newport Veterans Housing LP, a California limited partnership and City entered into that certain Regulatory Agreement and Declaration of Restrictive Covenants dated as of December 18, 2015 and recorded in the official r�ords of the County of Orange on December 22, 2015 as document number 2015000645086 ("Regulatory Agreement's and that certain Notice of Affordability Restrictions on transfer of Property dated as of December 18, 2015 as document number 2015000645085 ("Notice"). The AHA, Promissory Note, Deed of Trust, Regulatory Agreement, and Notice are referred to collectively herein as "Loan Documents. " D. Newport Veterans Housing LP, a California limited partnership subsequently assigned all of its right, title and interest in, and duties and obligations under, the Loan Documents to Borrower and Borrower accepted such assignment pursuant to that certain Affordable Housing Agreement and Joint Escrow Instructions Assignment and Assumption Agreement dated June 28, 2017 and recorded in the official records of the County of Orange on June 30, 2017 as document number 2017000273545 ("Second Assignment Agreement"). Amendment to Loan Documents Page 2 of 11 E. The Parties acknowledge that AEGON USA Realty Advisors, LLC, an Iowa limited liability company, is an equity investor of Borrower's, whose affiliate AEGON LIHTC Fund 52, LLC, a Delaware limited liability company, is a qualified tax credit investor and limited partner of Borrower's, and Transamerica Affordable Housing, Inc., a California corporation, is a special limited partner of Borrower's. F. The Parties now wish to amend certain provisions of the AHA, the Promissory Note, the Deed of Trust, and the Regulatory Agreement. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows: 1. The AHA is hereby amended as follows: a. All references to "nine percent (9%) Tax Credits" are hereby made references to "four percent (4%) Tax Credits". b. Part (i) of the last sentence in the 2nd paragraph of Section 1.5 is hereby deleted in its entirety and replaced with the following: following: "(i) the removal by the Qualified Tax Credit Investor of the general partner for a default under the partnership agreement, provided the replacement general partner is reasonably satisfactory to City; and provided, that the City's consent shall not be required if the replacement general partner is the special limited partner of the borrower." C. Section 2.1.3(a)(i) is hereby deleted in its entirety and replaced with the "A true and correct copy of the preliminary tax-exempt reservation letter from CTCAC." d. Sections 2.1.3(b) is hereby deleted in its entirety. e. Section 2.1.3(c) is hereby deleted in its entirety and replaced with the following: "Additional Financing. Developer has obtained a preliminary tax-exempt reservation of four percent (4%) tax credits for the development, rehabilitation, and operation of the Project. In addition to the Construction Loan, Permanent Loan and City Loan, the Developer has committed to provide a loan for the development, rehabilitation, and operation of the project and has obtained a loan from the California Housing Finance Agency, a loan from Mercy House CHDO, Inc. from the proceeds of a Citi Salute Grant and a loan from Affordable Housing Alliance II, Inc. dba Amendment to Loan Documents Page 3 of 11 Integrity Housing from an award of Affordable Housing Program Funds from the Federal Home Loan Bank of San Francisco as outlined on the updated Project Budget attached hereto and incorporated herein as Exhibit A, which replaces Attachment No. 8 to the AHA. In the event the allocation of Four Percent (4%) Tax Credits is not funded, Developer and City agree to act in good faith and cooperate to procure any additional funding that may benefit the Project. The failure by Developer to obtain funding of the Four Percent (4%) Tax Credits allocation or alternative funding by December 31, 2019, shall not be a default under this Agreement or any other document related hereto, but shall require the parties to renegotiate the terms of this Agreement within 90 days. If the Parties are unable to agree during such renegotiation to terms for amending this Agreement, Developer shall have one (1) year from that date to repay the amount of the City Acquisition Assistance then outstanding, with interest charged at a rate of the Prime Rate + 1% per annum. Developer may market and sell the Project or may retain ownership rights over the Project. Notwithstanding anything to the contrary contained herein the allocation of Four Percent (4%) Tax Credit shall be considered funded even if the final amount is less than what is shown in Exhibit A due to the application of adjusters contained in the Developer's organizational document or cost savings during development and rehabilitation of the Project." f. The following sentence is added at the end of Section 5.1: "The Qualified Tax Credit Investor shall receive all notices of default delivered to Developer, and any cure of default tendered by the Qualified Tax Credit Investor shall be accepted or rejected on the same basis as if tendered by Developer" 2. The Promissory Note is hereby amended as follows: a. All references to "an allocation of nine percent (9%) Tax Credits" are hereby made references to "a tax exempt reservation of four percent (4%) Tax Credits". b. The following sentence is added at the end of Section 9.1: "Notwithstanding the foregoing, any cure of default tendered by the Qualified Tax Credit Investor shall be accepted or rejected on the same basis as if tendered by Borrower" C. The following parties are added to the notice requirements of Section 11: Amendment to Loan Documents Page 4 of 11 To Qualified Tax Credit Investor: To Special Limited Partner: Aegon LIHTC Fund 52, LLC c/o AEGON USA Realty Advisors, LLC Attention: LIHTC Reporting Mail Drop 5553 4333 Edgewood Road NE Cedar Rapids, Iowa 52499-5553 Facsimile: (319) 355-8030 Transamerica Affordable Housing, Inc. c/o AEGON USA Realty Advisors, LLC Attention: LIHTC Reporting Mail Drop 5553 4333 Edgewood Road NE Cedar Rapids, Iowa 52499-5553 Facsimile: (319) 355-8030 With a copy to: Klein Hornig 101 Arch Street, Suite 1101 Boston, Massachusetts 02110 Attention: John R. Condon III, Esq. Facsimile: (617) 224-0601 3. The Deed of Trust is hereby amended as follows: Section 26: a. The following parties are added to the notice requirements of To Qualified Tax Credit Investor To Special Limited Partner Aegon LIHTC Fund 52, LLC c/o AEGON USA Realty Advisors, LLC Attention: LIHTC Reporting Mail Drop 5553 4333 Edgewood Road NE Cedar Rapids, Iowa 52499-5553 Facsimile: (319) 355-8030 Transamerica Affordable Housing, Inc. c/o AEGON USA Realty Advisors, LLC Attention: LIHTC Reporting Amendment to Loan Documents Page 5 of 11 Mail Drop 5553 4333 Edgewood Road NE Cedar Rapids, Iowa 52499-5553 Facsimile: (319) 355-8030 With a copy to: Klein Hornig 101 Arch Street, Suite 1101 Boston, Massachusetts 02110 Attention: John R. Condon III, Esq. Facsimile: (617) 224-0601 b. The first sentence of Section 27(b) is hereby deleted in its entirety and replaced with the following: following: following: "The term "sale" means any transfer, assignment, conveyance or lease (other than to a tenant for occupancy) of the Property and/or the improvements thereon, or any portion thereof, or any interest therein by the Trustor, but excludes the purchase option agreement given to Trustor's general partner(s) or repurchase option agreement given by Trustor's limited partners." C. Section 29 is hereby deleted in its entirety and replaced with the "It is hereby expressly agreed and acknowledged by Trustor and Beneficiary that this Deed of Trust will be a subordinate deed of trust only to the deed of trust securing the Acquisition Loan before the close of escrow. Further, this Deed of Trust shall only be subordinate to deeds of trust securing the Construction Loan and Take Out Loan upon receipt of a tax exempt reservation of four percent (4%) Tax Credits by the Developer, and that the City Loan secured hereby, and the City Loan Note will be subject and subordinate only to these deeds of trust as such are defined in the AHA (collectively referred to as the "Senior Loan"). d. Section 33(b) is hereby deleted in its entirety and replaced with the "The Trustor shall not be in default so long as it or one of its limited partners endeavors to complete such cure, correction or remedy with reasonable diligence, provided such cure, correction or remedy is completed within thirty (30) calendar days after receipt of written notice (or such additional time as may be reasonably necessary to correct the cause)." 4. The Regulatory Agreement is hereby amended as follows: Amendment to Loan Documents Page 6 of 11 a. All references to "an allocation of nine percent (9%) Tax Credits" are hereby made references to "a tax exempt reservation of four percent (4%) Tax Credits." b. Section 9.00) is hereby deleted in its entirety and replaced with the following: Section 18.0: effect. "the removal by the Qualified Tax Credit Investor of the general partner for a default under the partnership agreement, provided the replacement general partner is reasonably satisfactory to the City, and providedthat the City's consent shall not be required if the replacement general partner is the special limited partner of the Borrower." C. The following parties are added to the notice requirements of To Qualified Tax Credit Investor: To Special Limited Partner: With a copy to: Aegon LIHTC Fund 52, LLC c/o AEGON USA Realty Advisors, LLC Attention: LIHTC Reporting Mail Drop 5553 4333 Edgewood Road NE Cedar Rapids, Iowa 52499-5553 Attention: LIHTC Reporting Facsimile: (319) 355-8030 Transamerica Affordable Housing, Inc. c/o AEGON USA Realty Advisors, LLC Attention: LIHTC Reporting Mail Drop 5553 4333 Edgewood Road NE Cedar Rapids, Iowa 52499-5553 Attention: LIHTC Reporting Facsimile: (319) 355-8030 Klein Hornig 101 Arch Street, Suite 1101 Boston, Massachusetts 02110 Attention: John R. Condon III, Esq. Facsimile: (617) 224-0601 5. All other provisions of the Loan Documents remain unchanged and in full force and [Signatures on following page] Amendment to Loan Documents Page 7 of 11 IN WITNESS HEREOF, the Parties hereto have executed this Agreement as of the day and year first above written. BORROWER: NEWPORT VETERANS APARTMENTS LP, a California limited partnership By: CDP Newport LLC, a California limited liability company Its: Administrative General Partner By: Community Development Partners, a California corporation Its: Managing Member By: VC-• Kyle Yaine Its: President By: Mercy House CHDO, Inc., a California nonprofit public benefit corporation Its: Managing General Partner By: La aynes Its: E cutive Director [Signatures Continue on Following Page] Amendment to Loan Documents Page 8 of 11 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF �D-�,r y Qui 11 c. On 1'i) $' aDlg before me,T)',=0.int.lgtjQ,Vr (here insert name and title of the officer), ersonally appeared Kj le- Tou rQ- who proved to me on the basis of satisfactory evidence to be the person(s) whose name(,4 is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(jmsj, and that by his/her/their signature(A) on the instrument the person, or the entity upon behalf of which the person) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. �r. DIANA MUELLER WITNESS my hand and official seal.o. COMM. #2204952 sup Notary Public • California Orange County .: Signature (Seal) Comm. _Expires July 14, 2121 t CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF in ra,.1Vj,eJ On '� ► g' before me, &Ll%ma A 1 4xduk% (here insert name and title of the officer), personally appeared ' ,.?,4 who proved to me on the basis of satisfactory evidence to be the perso (s) wl4ose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. WOMACK �.; COMM3 2113336 'n �— --- N $ NOTARY PUILIC•CAIIFORNIA u' Signature -�� (Seal) ORANOF COUMiY o� �.r" MY COMM EIP. MAY 29, 2019' Amendment to Loan Documents Page 9 of 11 CITY: CITY OF NEWPORT BEACH, a California municipal corporation and charter city By:4� Marshall "Duffy" Duffield Its: Mayor APZ O FORM: Aaron C. Harp khm orlwli� City Attorney ATTEST: Leilani I. Brown City Clerk L11.1 FON': Attachments: Exhibit A — Updated Project Budget Amendment to Loan Documents Page 10 of 11 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF oR IAM Co, G , WOTAO Pu6-.%c On MAI 10 IS before me,JENN1FrER ANN MV`VE-4 here insert name and title of the officer), personally appeared MAQSNALL puFp*i NF1 Wo proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. Jennifer Ann Mulvey WITNESS my hand nd official seal. COMM #2214138 n sum Notary Public -California A ORANGECOUNTY . MyCommissionuoresOct.12,202i Signature (Seal) CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF On before me, (here insert name and title of the officer), personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) Amendment to Loan Documents Page 11 of 11 Exhibit A Updated Project Budget Amendment to Loan Documents Page A-1 NEWPORT VETERANS PROJECT SUMMARY 4/27/2018 YMeCtUhlestone =d1ate LIHTC 4% Application 8/19/2016 CDLAC Award 9/21/2016 LIHTC 4% Award 10/19/2015 AHP Application 3/1/2017 Construction Commence/LP Closing 6/22/2017 Anticipated Construction Completion 1/30/2018 Stabilization (Lease -up Complete) 1/31/2018 Perm Loan Closing (Conversion) 5/1/2019 8609s 6/1/2019 Federal Tax Credit Equity 2,035,153 Ca1HFA Permanent Loan 1,575,000 City of NB Note 1,975,000 Ca1HFA Soft Debt 290,000 CITI Salute Grant + Home Depot 185,000 Deferred Developer Fees 480,472 TOTAL 6,660,626 Acquisition 3,506,400 Direct Construction Costs 1,346,340 Construction Contingency 134,634 Indirect and Soft Costs 353,574 Developer Fee 678,431 Financing Costs 577,688 Project Reserves 63,559 TOTAL 6,660,626 Other Information: LIHTC Equity Pricing 0.98 LIHTC Federal Credits to Investor 2,076,687 Construction/Bridge Loan 3,186,612 NEWPORT VETERANS PROJECT DEVELOPMENT COSTS 4/27/2018 ACQUISITION ke Land Costs 2,815,000 680,000 3,495,000 291,250 Acq Loan Interest & Closing Costs - 11,400 11,400 950 Total 2,815,000 691,400 3,506,400 292,200 DIRECT CONSTRUCTION Direct construction/HardCosts 1,168,698 - 1,168,698 97,392 General Conditions 6.00% 70,122 70,122 5,843 Fees / Overhead 8.00% 93,496 93,496 7,791 Insurance 1.20% 14,024 14,024 1,169 P&P Bond (Indirects) - Total Construction Contract 1,346,340 1,346,340 112,195 Construction Contingency 134,634 134,634 11,220 Total Direct Construction 1,480,974 1,480,974 123,415 INDIRECT CONSTRUCTION Engineering 45,000 45,000 3,750 Architectural Design 75,000 75,000 6,250 Arch Admin / CM / Consultant 65,080 65,080 5,423 Permits 10,000 10,000 833 P&P Bonds 14,194 14,194 1,183 FF& E (Furniture) - _ _ Builder's Risk Insurance 6,800 6,800 567 Total 216,074 216,074 18,006 SOFT COSTS Developer's Fee Acquisition 422,250 422,250 35,188 Developer's Fee Construction 256,181 256,181 21,348 Property Liability Insurance 6,500 6,500 542 Real Estate Taxes/Assessments 20,000 20,000 1,667 Audit/Accounting 20,000 20,000 1,667 Misc. Soft Costs 14,000 14,000 1,167 Marketing _ _ _ Relocation 77,000 77,000 6,417 Total 815,931 - 815,931 67,994 RESERVES/RENT-UP COSTS Operating Reserve Requirements - 51,559 51,559 4,297 Capitalized Services Reserve - _ _ Initial Replacement Reserve (CaIHFA) 12,000 12,000 1,000 Total - 63,559 63,559 5,297 FINANCING COSTS Construction Loan Interest Reserve 85,000 15,569 100,569 8,381 Citi Const Loan Orig Fee 33,000 - 33,000 2,750 Citi Const Loan UW + Legal Fees 82,920 - 82,920 6,910 CaIHFA. Perm Ong Fee - 15,750 15,750 1,313 CatHFA Perm App+UW+Legal Fees 32,750 32,750 2,729 Aegon UW + Legal Fee 55,700 55,700 4,642 Title/Escrow/Closing (Constr/Perm) 25,000 10,000 35,000 2,917 Monthly Const Inspection Fee (Citi&CalHFA) 5,500 - 5,500 458 Borrower Legal Counsel Fees incl Bond 100,000 55,211 155,211 12,934 Land Survey 5,000 - 5,000 417 Market Study (CDP) 5,414 5,414 451 Appraisal (CDP) 5,650 5,650 470.83 Environmental Reports (Ph1, Phll/LBP/ACM) 9,900 9,900 825 Energy Audit/App 5,810 5,810 484 PNA (CDP) 2,050 - 2,050 171 TC / VHHP Application Fee - 4,600 4,600 383 TCAC Allocation/Reservation Fee 10,270 10,270 856 Filing Fee (BOND) _ _ TCAC Performance Deposit - _ _ Compliance Monitoring Fee 4,510 4,510 376 CalHFA Issuer Fee 6,880 6,880 573 CDLAC Fee - 1,204 1,204 100 Total 365,244 212,444 577,688 48,141 TOTAL USES 5,693,223 967,403 6,660,626 555,052 ncmg costs uetau Aeeon 1,200 Insurance Review 1,200 Seismic 2,800 Market Study 500 PCR 50,000 Legal 55,700 Total Citi 33,000 Origination 65,000 Legal 5,500 Appraisal 4,400 Engineering (PCR/Seismic) 5,000 UW/Inspection Cots 1,250 Insurance Review 775 CDIAC Fee 22 Flood Cert 789 Zoning Report 184 Credit Reports 115,920 Total CaIHFA 5,000 App Fee 15,750 Loan Fee 1% 6,880 Issuer Fee 55,211 Bond Counsel 10,000 Legal Fee 750 Admin Fee 6,500 Appraisal 5,000 PNA 2,500 NEPA Review 3,000 EQ Ins/Sesmic Rev 55,380 Total NEWPORT VETERANS UNIT MIX AND INCOME ANALYSIS 4/27/2018 Unit 1 Type Unit Sqft Unit Count AMI Level *Gross Rent Utility Allowancf Tenant Voucher Rent Rent Monthly Rental Inc Annual Rental Inc 1 Bed - 1 Bath - VASH 400 6 30% 1642 46 481 1115 9,576 114,912 1 Bed - 1 Bath - Senior 400 2 40% 783 46 737 0 1,474 17,688 1 Bed - 1 Bath - Senior 400 3 50% 978 46 932 0 2,796 33,552 1 Bed - 1 Bath - Senior 400 1 60% 1174 46 1128 0 1,128 13,536 Totals 12 1,115 14,974 179,688 Base Year Cash Flow Monthlv Annual Per Unit 7N,Units Voucher Mo. Total AnnualRENTAL INCOME 14,974 179,688 14,974 1,115 6,690 80,280 Other Income - App and Tenant Charges 120 1,440 120 Services Reserve - - Total Other Income 1,440 120 Total Rental & Other Income 181,128 15,094 Vacancies (Not Incl Rese 5.00% (9,056) (755) TOTAL INCOME 172.072 14.339 Management Fee 8,520 710 Administrative 3,926 327 Payroll 18,280 1,523 Maintenance 11,995 1,000 Utilities 8,874 740 Insurance (& taxes if any) 6,004 500 Service Amenities 8,400 700 Replacement Reserves 4,800 400 TOTAL EXPENSES 70,800 5,900 CASH FOR DEBT SERVICE 101,272 8,439 PERM LOAN DEBT 83,877 6,990 NET CASH FLOW 17,394 1,083 PERMANENT LOAN SIZING Payments 40 DCR 1.21 Interest Rate 4.41% Total Financing $1,575,000 NEWPORT VETERANS EQUITY AND CONSTRUCTION FINANCING 4/27/2018 Eligible Basis 2,455,973 3,237,250 Volunteered Credit Reduction - - Requested Unadjusted Eligible Bas 2,455,973 3,237,250 QCT/DDA Boost 130% 100.00% Total Adjusted Eligible Basis 3,192,765 3,237,250 Applicable Fraction 100.00% 100.00% Qualified Basis 3,192,765 3,237,250 Less: Credit Reduction (Points) - - Adjusted Qualified Basis 3,192,765 3,237,250 Federal Applicable Percentage 3.23% 3.23% Annual Federal Tax Credits 103,126 104,563 'Tax CrediLL,_quit Rehab &Act Total Annual Credits 207,689 Total 10 Year Credit 2,076,895 Investor Ownership 99.99% 2,076,687 Selling Price @ $ 0.98 Total Tax Credit Equity $ 2,035,153 Total Development Costs Equity During Construction Delayed Fee Deferred Fee City of NB Note Citi Salute/CaIHFA SubDebt Operating Reserves $ 6,660,626 30 -Day LIBOR $ (610,546) Spread $ (197,959) All -in Rate $ (480,472) Type $ (1,975,000) Term (months) Construction Loan Min 50% Test Min Citi Commitment Needed LTC % Check /higher ofl $ (120,000) 6/22/2017 $ (51,559) $ $ (10,000) 0.00% S 3,215,090 2 Completion S 3,186,612 15.00% $ 3,300,000 305,273 48.27% $ - 0.99% 3.00% 3.99% Variable 24 Total Dev Fee $ 678,431 Deferred Fee $ 480,472 Net Fee $ 197,959 1 Closing 6/22/2017 15.00% $ 305,273 0.00% $ - 2 Completion 12/1/2017 15.00% $ 305,273 0.00% $ - 3 Conversion 5/1/2019 68.00% $ 1,383,904 79.44% $ 157,256 4 8609 6/1/2019 2.00% $ 40.703 20.56% $ 40,703 100.00% $ 2,035,153 100.00% S 197,959 Closing 6/22/2017 0 0 Completion 12/1/2017 162 162 100% Lease Up 1/31/2018 61 223 Stabilized 90 Days 5/2/2018 91 314 8609 6/15/2018 44 358 Scheduled Conversio 5/1/2019 320 678 C� ��'o,m av, e m eo.A vqj, o � m— —Mv�O. o .'", m.Mu � m a �O ~ al lc� I "; IN ^ N N b nl m O c4 lV w; P ll= ... 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