REPORT TO COUNCIL
SUBJECT
Title
Approve a Purchase and Sale Agreement Between the City of Sunnyvale and MP Land Holdings, LLC (MidPen Housing) for the Purchase of 1171 Sonora Court, Approve a Disposition and Development Agreement to Construct a New Affordable Housing Development; and Adopt a Resolution to Authorize a Ground Lease and a Resolution to Declare the Property Exempt from the Surplus Lands Act; and Find that these Actions are Exempt from the California Environmental Quality Act (CEQA) Pursuant to CEQA Guidelines Sections 15004(b)(2)(A) and 15312
Report
BACKGROUND
On May 2, 2024, the Housing Division issued a Notice of Funding Availability (NOFA) for the construction, rehabilitation, acquisition, and/or predevelopment of affordable housing developments to be funded by the City's Housing Mitigation Funds (HMF) and Below Market Rate (BMR) In-Lieu Funds. On August 13, 2024, Council approved $29,533,000 in NOFA awards for three projects, including an award of approximately $14 million to MidPen Housing (MidPen) for the construction of a new 172-unit affordable housing development located at 1171 Sonora Court (the "Project"). (RTC No. 24-0863.) This funding award is intended to support two separate components of the Project. The first component is the City's acquisition of the 1171 Sonora Court property from MidPen for $12.5 million. The second component is a loan of $1,533,000 to support predevelopment costs for the Project.
Prior to the recent $14 million NOFA award, the City previously awarded the Project $500,000 in predevelopment funding during the 2022 NOFA. The $500,000 award consisted of Permanent Local Housing Allocation (PLHA) funds, which are allocated to the City by the State Department of Housing and Community Development. Since the 2022 NOFA award, MidPen has completed predevelopment activities including preparing architectural plans and submitting a formal application for planning entitlements on December 21, 2023. Once planning entitlement...
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