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Presentation, discussion, and possible action regarding a Material Amendment to the Housing Tax Credit Application for Santa Fe Place (HTC #23178/24266)
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RECOMMENDED ACTION
recommendation
WHEREAS, Santa Fe Place (Development) received an award of 9% Housing Tax Credits (HTCs) as a forward commitment in 2023 for the new construction of 110 multifamily units, 98 of which are low-income units, for the general population in Lubbock, Lubbock County;
WHEREAS, KRS Santa Fe Place, LP (Applicant) requests approval for changes to the site plan and architectural design plans to ensure financial feasibility;
WHEREAS, the Applicant requests approval for a decrease in the total number of units from 110 to 90, by removing all 12 market rate units and eight HTC units, representing a reduction of 8.16% in the number of low-income units;
WHEREAS, the Applicant also requests approval for a reduction to the Net Rentable Area (NRA) from 102,995 square feet to 74,100 square feet, which is a reduction of 28,895 square feet or 28.05%, and for a reduction in the Common Area from 13,897 square feet to 12,088 feet, representing a reduction of 1,809 square feet or 13.02%;
WHEREAS, the redesign would also change the buildings’ positioning on the site, though the site footprint itself will not be changing from Application, make the clubhouse part of one of the residential buildings, and the new plans no longer include a pool;
WHEREAS, Board approval is required for a significant modification of the site plan, a modification of the number of Units or bedroom mix of the Units, a reduction of 3% or more in the square footage of the Units or Common Area, a significant modification of the architectural design, and a modification of the residential density of at least 5% as directed in Tex. Gov’t Code §2306.6712(d)(1), (2), (4), (5), and (6) and 10 TAC §10.405(a)(4)(A), (B), (D), (E), and (F), and the Owner has complied with the amendment requirements therein; and
WHEREAS, the requested changes do not negatively affect the Development, impact the viability of the transaction, impact the scoring of the Application, or affect the HTC amount awarded;
NOW, therefore, it is hereby
RESOLVED, that the requested amendment for Santa Fe Place is approved as presented at this meeting, and the Executive Director and his designees are each hereby authorized, directed, and empowered to take all necessary action to effectuate the foregoing.
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BACKGROUND
Santa Fe Place was approved for a 9% HTC award as a forward commitment in 2023 for the construction of 110 units, of which 98 are designated as low-income units, of multifamily housing for the general population in Lubbock, Lubbock County. In a letter dated November 22, 2024, Sarah Anderson, the representative for the Applicant, requested approval for a material amendment to the Application.
The Applicant indicated that the initial design of the Development is no longer financially viable and is requesting approval for a reduction to the number of units from 110 to 90, by removing the 12 market units and eight HTC units, which represents a reduction of 8.16% in the number of low-income units and a reduction of 18.18% in total units. The reduction to the number of units will result in an 18.18% decrease in residential density from 24.11 units per acre to 19.72 units per acre. The Net Rentable Area will decrease from 102,995 square feet to 74,100 square feet, a reduction of 28,895 square feet (28.05%). The revised unit mix includes 24 one-bedroom units, 48 two-bedroom units, and 18 three-bedroom units instead of the originally proposed 30 one-bedroom units, 58 two-bedroom units, and 22 three-bedroom units. Additionally, the Applicant requests approval for a reduction to the total Common Area from 13,897 square feet to 12,088 square feet, a decrease of 1,809 square feet (13.02%). The decrease in the number of units has reduced the required parking spaces under the Lubbock zoning ordinance from 244 to 120. The pool will also be eliminated. The Applicant states that this redesign is needed to ensure financial feasibility of the Development.
The reduction to the number of units will result in the elimination of the market rate units and a reduction to the units at 30% of Area Median Income (AMI) units from 10 units to nine units, a reduction to the 50% AMI units from 20 units to 18 units, and a reduction to the 60% AMI units from 68 units to 63 units. Additionally, there are changes to the square footage of the units, which will now be at the minimum required square footage for points for each size.
The Development was re-underwritten with the proposed amendment and revised financial information. The analysis supports no change to the HTC allocation and demonstrates the Development remains feasible.
Staff confirmed that the revised design plans and parking will continue to meet accessibility requirements. Additionally, staff reviewed the original Application and scoring documentation against this amendment request, and has concluded that none of the changes would have resulted in selection or threshold criteria changes that would have affected the selection of the Application in the competitive round.
Staff recommends approval of the amendment as presented herein.