| | | | | | | | Housing and Redevelopment Authority Board Action Request
22-HCHRA-0013
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| | | | | | | | Item Description:
Accept transfer of $3,316,000 in pandemic recovery funds from Hennepin County to acquire/repurpose existing structures for permanent housing; Neg Agmts with Mian Hospitality Group LLC and RNH Equities LLC for the purchase of property, 04/27/22-09/30/22, total NTE $3,075,000 plus normal and customary closing costs |
| | | | | | | | Resolution:
BE IT RESOLVED, that the Hennepin County Housing and Redevelopment Authority hereby accepts transfer from Hennepin County of $3,316,000 of its pandemic recovery funding, authorized under Resolutions 21-0305 (adopted August 17, 2021) and 22-0136R1 (adopted March 22, 2022), to increase the supply of long-term affordable housing for low-income households, especially single adults experiencing homelessness/housing instability during the period April 27, 2022 through September 30, 2022; and that the Controller be authorized to accept, transfer and disburse funds as directed; and
BE IT FURTHER RESOLVED, that the Executive Director be authorized to negotiate Purchase Agreement LS00000025 with Mian Hospitality Group LLC for the purchase of property located at 5719 Lyndale Avenue South, Minneapolis (PID 22-028-24-23-0202), for the purchase price of $1,975,000 plus normal and customary closing costs (estimated at $20,000) and holding costs ($35,000), to provide long-term affordable housing for low-income households, especially single adults experiencing homelessness/housing instability; that following review and approval by the County Attorney’s Office, the Chair of the Board be authorized to sign the Purchase Agreement, and all documents associated with the conveyance on behalf of the Authority; and that the Controller be authorized to disburse funds as directed; and
BE IT FURTHER RESOLVED, that the Executive Director be authorized to negotiate Purchase Agreement LS00000027 with RNH Equities LLC for the purchase of property located at 4628 41st Avenue North, Robbinsdale, (PID 06-029-24-13-0029), for the purchase price of $1,100,000 plus normal and customary closing costs (estimated at $20,000) and holding costs ($16,000), to provide long-term affordable housing for low-income households, especially single adults experiencing homelessness/housing instability; that following review and approval by the County Attorney’s Office, the Chair of the Board be authorized to sign the Purchase Agreement, and all documents associated with the conveyance on behalf of the Authority; and that the Controller be authorized to disburse funds as directed; and
BE IT FURTHER RESOLVED, that a supplemental appropriation to the 2022 Hennepin County Housing and Redevelopment Authority Fund 37 (Special Projects) budget in the amount of $3,316,000 be approved; and that the Controller be authorized to accept, transfer and disburse funds as directed. |
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| | | | | | | | Background:
History: On August 17, 2021, the Hennepin County Board authorized $46,000,000 in Federal Pandemic Funds for equitable housing recovery strategies (Resolution 21-0305) such as:
- Investments to immediately increase affordable multifamily housing production, such as:
- gap funding for affordable housing projects serving populations disproportionately impacted by the COVID-19 public health emergency
- investments to address a backlog of deferred rehab need in Naturally Occurring Affordable Housing (NOAH) properties (a primary source of housing for populations disproportionately impacted by the COVID-19 public health emergency) and support for additional non-profit preservation acquisition of at-risk NOAH properties
- Acquisition of properties supporting affordable housing along the housing continuum, especially single adults experiencing homelessness/housing instability
- Homebuyer Assistance programs targeting populations disproportionately impacted by the COVID-19 public health emergency
Resolution 22-0136R1 (adopted March 22, 2022) authorized the County Administrator to rescind the funding source for any prior board action that authorized use of Federal Pandemic Funds for pandemic recovery activities in order to use other resources for the same activities. The County Administrator has accordingly rescinded the original funding source for Resolution 21-0305 and designated pandemic recovery funds for the previously authorized equitable housing recovery strategies.
Consistent with Resolutions 21-0305 and 22-0136R1, the Hennepin County Board authorized the transfer of $3,316,000 to the Hennepin County Housing and Redevelopment Authority (HCHRA) to increase the supply of long-term affordable housing for low-income households, especially single adults experiencing homelessness/housing instability (Resolution 22-0143, adopted April 19, 2022).
Specifically, to address the general lack of affordable housing, the HCHRA will use the $3,316,000 to acquire/repurpose two existing hotel/motel properties for permanent, single room occupancy housing. After necessary repairs/rehabilitation (undertaken by Hennepin County Facility Services), the HCHRA will contract with third-parties to lease, operate and manage the newly acquired properties for the provision of low-income housing.
Staff has identified two available properties located at 5719 Lyndale Avenue South, Minneapolis (Aqua Motel), and 4628 41st Avenue North, Robbinsdale (Robin Hotel):
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5719 Lyndale Avenue South |
4628 41st Avenue North |
| Site |
approx. 070 acres |
approx. 0.15 acres |
| Building |
15,127 sq. ft. |
6,370 sq. ft. |
| Units |
36 |
25 |
| Owner |
Mian Hospitality Group LLC |
RNH Equities LLC |
| Purchase Price |
$1,975,000 |
$1,100,000 |
| Est. Closing |
$20,000 |
$20,000 |
| Est. Holding |
$35,000 |
$16,000 |
| Est. Rehab* |
$1,200,000 |
$500,000 |
| Contingency |
$75,000 |
$75,000 |
* Hennepin County Facility Services
This effort to provide permanent affordable housing opportunities to low-income households is a cost-effective and proportional response to this need.
Request: Accept transfer of $3,316,000 in Hennepin County pandemic recovery funds to provide long-term affordable housing for low-income households, especially single adults experiencing homelessness/housing instability; negotiate Purchase Agreements LS00000025 and LS00000027, with a total combined purchase price of $3,316,000 (including normal and customary closing and property holding costs, and contingency); authorize supplemental appropriation of $3,316,000 to 2022 HCHRA Fund 37 (Special Projects) budget.
Impact/Outcomes: Acquisition of these properties will expand the supply of affordable housing for low-income residents.
Housing Domain Disparity: Households of color are disproportionately housing cost burdened. This request creates housing opportunities that will be affordable to households below 30% of area median income. |
| | | | | | | | | Recommendation from County Administrator: Recommend Approval |
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