Apartment Deal Could Help Fill City's Housing Quota

A foreclosed apartment complex being eyed for financing by a nonprofit agency would offer low-income rents, making a small dent in the city's state-mandated low-income housing quota.

Foundation for Affordable Housing, an Orange County-based nonprofit, plans to purchase Rancho Las Brisas Apartments. In addition to setting aside low-income units, the foundation plans to implement a crime-free policy.

The complex, built in 1989 at 40125 Los Alamos Road just west of Interstate 215, was foreclosed on Jan. 12. Its previous owner bought the 200-unit complex in 2006 for $29 million. Security fencing and gates were added at that time.

FFAH plans to purchase it for $20.3 million, with $23 million in multifamily housing revenue bonds issued by the California Statewide Communities Development Authority.

The remaining funds will be used for improvements such as bringing the complex up to par in energy efficiency, according to Deborrah Willard, co-founder of FFAH.

FFAH will pay back the bonds from revenue generated.

Willard said the goal is to close the deal, which is a 15-year covenant, in December.

In order to receive ideal, tax-exempt funding, FFAH needed the approval of the city of Murrieta. Although the city is not involved in the financial dealing, City Council held a public hearing Oct. 18, approving the deal with a 3-1 vote, with Councilman Alan Long dissenting.

Willard said if they hadn't received the city's OK, they would still have tried to move forward in the project. Gaining their approval means less paperwork, she said.

"We really only search for properties we can afford to buy," Willard said.

After securing the funding, FFAH plans to set aside half of the units for renters with very-low to low incomes. Forty of the units will go to very-low income earners, Willard said.

In Riverside County, a family of four that earns $31,250 is 50 percent of the Area Median Income and considered very low.

According to Willard, rent on a one-bedroom apartment will go from $866 a month to $675 for those who earn $25,025 or less.

"We believe there are already 40 people there who qualify," Willard said. "The only thing that will change is that they will be able to afford their rent."

Rent on two-bedroom apartments with one or two baths will be $759 for those who earn no more than $30,050.

Willard said FFAH will hire a third-party property management company, who will be charged with reviewing credit reports, complying with the Crime-Free Multi Housing Program, selecting the highest quality tenants and complying with Fair Housing standards.

The on-site manager and leasing agent will be certified in the Crime-Free Multi Housing Program, she said.

Council members quizzed Police Chief Mike Baray about how the crime-free program would be enforced. He said it sees it as a "plus" for the property.

"Once they sign that lease addendum, they are agreeing to abide by those rules and it will be up to on-site manager (to report)," Baray said.

Murrieta Community Development Director Mary Lanier said city staff and the police department reviewed other facilities owned by FFAH, and found them well-maintained and managed.

Lanier said the 100 low-income units will help the city fill its Regional Housing Needs Assessment quota, intended to ensure cities provide housing for all income levels.

In 2008, the city needed to add 2,600 low-income units.  Currently, the city's only low-income units are located across from City Hall, where a crime-free addendum is in place.