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Presentation, discussion, and possible action regarding a Material Amendment to the Housing Tax Credit (HTC) Application of The Lantern at Robstown (HTC #25177)
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RECOMMENDED ACTION
recommendation
WHEREAS, The Lantern at Robstown (Development) received an award of 9% Housing Tax Credits (HTCs) in 2025 for the new construction of an office/clubhouse and seven one-story residential buildings containing 39 dwelling units with attached one-car garages on a 7.164 acre site in Robstown, Nueces County;
WHEREAS, Lantern at Robstown, LP (Applicant) requested approval to significantly modify the site plan, increase the number of low income units from 39 to 46, increase the total number of units from 39 to 49, modify the unit mix from 15 one-bedroom units and 24 two-bedroom units to 15 one-bedroom units and 34 two-bedroom units, increase the square footage of the units by 9.0% from 36,084 square feet to 39,336 square feet, increase the Common Area by 384.7% from 1,888 to 9,151 square feet, significantly modify the architectural design of the Development, and increase the residential density by 23.3%, from 5.44 units per acre to 6.71 units per acre;
WHEREAS, Board approval is required for a significant modification of the site plan, modification of the number of units or bedroom mix of units, significant modification of the architectural design, and modification of the residential density of at least 5% as directed in Tex. Gov’t Code §2306.6712(d)(1), (2), (5), and (6), and 10 TAC §10.405(a)(4)(A), (B), (E), and (F), and the Applicant has complied with the amendment requirements therein; and
WHEREAS, the requested changes do not materially alter the Development in a negative manner, were not reasonably foreseeable or preventable at the time of Application, and would not have adversely affected the selection of the Application for an award of Housing Tax Credits;
NOW, therefore, it is hereby
RESOLVED, that the requested Material Amendment of the Application for Lantern at Robstown is approved as presented to this meeting, and the Executive Director and his designees are each authorized, directed, and empowered to take all necessary action to effectuate the foregoing.
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BACKGROUND
The Lantern at Robstown received a 9% HTC award in 2025 to develop a 7.164 acre site approximately 470 feet west of CR 69 and 950 feet north of CR 44 in Robstown. Access to the site was via a driveway from CR 44. A few hundred feet of the southernmost end of the driveway was in Zone X (0.2%) of the 500-year floodplain. The Application proposed the new construction of a freestanding office/clubhouse and site amenities inside the course of the development’s circular driveway and seven one-story residential buildings along the outside of the driveway. Each of 39 proposed units had a driveway and one-car garage. The 39 driveways accounted for 39 of the development’s surface parking spaces with three locations along the inside edge of the site’s driveway accounting for 10 additional surface parking spaces. Garages and surface parking together totaled 88 parking spaces. In comparison, the amendment proposes a 7.301 acre site adjacent to and accessible from CR 69. The site contains a single three-story building containing 49 units and office/clubhouse spaces on each floor. Parking facilities consist of 81 surface parking spaces in a conventional rectangular parking lot. The Application proposed a residential density of 39 units per 7.164 acres or 5.44 units per acre (UPA). The amendment proposes 49 units per 7.301 acres or 6.71 UPA, a 23.3% increase.
The amendment proposes a modification of the number of units and bedroom mix of units. The Application proposed 15 one-bedroom units and 24 two-bedroom units. All one-bedroom units included a “home office” that would fit the definition of bedroom except for the absence of a closet. The two-bedroom units did not have an office. This difference caused the 14 non-ADA one-bedroom units and 23 non-ADA two-bedroom units to be the same size, 918 square feet. Similarly, the presence of offices in the sole one-bedroom ADA unit and absence of an office in the sole two-bedroom ADA unit caused both these unit types to be 1,059 square feet. In comparison, the amendment proposes 13 one-bedroom units of 652 square feet, two one-bedroom ADA units (1 mobility and 1 hearing/vision) of 657 square feet, and 34 two-bedroom units (including 1 mobility unit) of 869 square feet. In all, the Application proposed Net Rentable Area (NRA) of 36,084 square feet, and the amendment proposed NRA of 39,336 square feet, an increase of 9.0%. The Application proposed 3-30% units, 6-50% units, and 30-60% units. The amendment proposed 6-30% units, 7-50% units, 33-60%, and 3 market rate units. Therefore, the amendment increases the 30%, 50%, and 60% units by 3, 1, and 3, respectively, and adds 3 market rate units not previously proposed. The foregoing distributions of income and rent restricted units would produce the same score for the amendment as for the Application.
The Application proposed a separate clubhouse with 1,888 square feet of Common Area accessible to tenants, including a covered patio, covered porch and 1,339 square feet of conditioned space. The total Common Area of 1,888 square feet in the Application compares to total Common Area of 9,151 in the amendment, an increase of 384.6%. Net of the elevator shaft and interior corridors, the amendment’s conditioned Common Area of 1,758 square feet is 31.3% more than the conditioned area of the Application.
The amendment proposes a significant modification of the site plan, modification of the number of units and bedroom mix of units, significant modification of the architectural design of the development, and modification of the residential density of the development of at least five percent. Each of these changes constitutes a Material Amendment of the Application that must be considered by the Board. The applicable sections of Statute and Code are §2306.6712(d)(1), (2), (5) and (6), and 10 TAC §10.405(a)(4)(A), (B), (E), and (F).
It is the opinion of staff that the changes will not materially alter the Development in a negative manner. Staff reviewed the threshold and scoring documentation of the amendment against the corresponding documentation of the Application and found no adverse effect on the selection of the amended Application for an award in the application round. The Application had an overwhelming excess of points scored over the only other application in its subregion, 166 points to 89 points per the final application log.
In staff’s judgement, the changes that are requested were not reasonably foreseeable at the time the Application was presented, nor were they preventable. The changes would not have affected the selection of the Application for an award. The reasons given for the amendment request were inflation, supply chain issues and concern about the 500-year floodplain that affected a limited portion of the driveway. All these issues arose after the application was submitted.
The Development was re-underwritten under the proposed amendment, using revised and updated financial information. The analysis indicated that the Development remained financially feasible and no change in the funding amount was recommended.
Staff recommends approval of the amendment request as presented herein.