TITLE
Recommendation to authorize City Manager to execute any and all documents necessary for the assignment of a $950,000 City loan from Mental Health America of Los Angeles to Sara’s Apartments, L.P., and the transfer of ownership of Sara’s Apartments, located at 240 West 7th Street, from Mental Health America of Los Angeles to Sara’s Apartments, L.P. (District 1)
DISCUSSION
In December 1993, the City of Long Beach issued a HOME loan in the amount of $950,000 (Loan) to the Mental Health Association in Los Angeles County, now Mental Health America of Los Angeles (MHA), for the acquisition and rehabilitation of Sara’s Apartments, located at 240 West 7th Street. The property contains a total of 29 single and one-bedroom affordable rental units. The term of the loan, and related affordability restrictions, ends on August 1, 2023. The outstanding loan balance is approximately $354,000.
MHA is a non-profit affordable housing developer that specializes in providing service-enriched housing to persons with mental illness. MHA founded Clifford Beers Housing, Inc. (CBH) in 2005, as another non-profit affordable housing developer. As an affiliate of MHA, CBH seeks to develop affordable housing that targets a percentage of the units for homeless households, including those living with mental illness. To date, CBH has 236 affordable housing units completed or in the pipeline. At the request of CBH, MHA has agreed to form Sara’s Apartments, L.P., a new California limited partnership for the purpose of owning and operating Sara’s Apartments. Under this new ownership structure, MHA would become a 99.99 percent Limited Partner, and CBH would become a .01 percent General Partner. The Loan documents give the City the right to consent to any assignment of the Loan and/or any transfer of the property which secures the Loan.
CBH’s request to become the general partner of the new entity that will own Sara’s Apartments was triggered by the California Tax Credit Allocation C...
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