HomeMy WebLinkAbout10- Development Department EVELOPMENT DEPARTII NT
OF THE CITY OF SAN BERNARDINO
REQUEST FOR COMMISSION/COUNCIL ACTION
FROM: KENNETH J. HENDERSON SUBJECT: ARROW VISTA HOUSING
Executive Director DEVELOPMENT PROJECT
DATE: January 20, 1994
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Synonsis of Previous Commission/Council/Committee-Action(s):
On September 20, and October 1993, the Community Development Commission and Redevelopment Committee
considered various delinquent Agency notes with Dukes-Dukes and Associates. On October 7, 1993, the Committee
submitted two (2) recommendations to the Community Development Commission regarding this project.
(SYNOPSIS CONTINUED TO NEXT PAGE...)
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Recommended Motion(s):
(COMMUNITY DEVELOPMENT COMMISSION)
MOTION: That the Community Development Commission consider disposition of the Arrow Vista Housing
Development Phase I and Phase IIA standing inventory.
Administrator KENN TH J. HEk6ERSON
Executive Director
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Contact Person(s):Kenneth J. Henderson/David R. Edgar Phone: 5081
Project Area(s): Northwest (NW) Ward(s): Six (6)
Supporting Data Attached: Staff Report
FUNDING REQUIREMENTS: Amount:$ N/A Source: N/A
Budget Authority: N/A
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Commission/Council Notes:
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KJH:DRE:paw:arowdvlp.cdc COMMISSION MEETING AGENDA
Meeting Date: 01/24/94
Agenda Item No: / D
DEVELOPMENT DEPE i MENT REQUEST FOR COMMI: ON/COUNCIL ACTION
Arrow Vista Housing Development Project
Prepared: January 19, 1994
Page - 2 -
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Synopsis of Previous Commission/Council/Committee Action(s) Continued...
On November 1, 1993, the Community Development Commission agreed to reconsider disposition of
this development project in sixty (60) days.
On January 10, 1994, the Community Development Commission discussed the current status of the
marketing and sales activity regarding Arrow Vista Phase I and Phase IIA standing inventory.
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KJH:DRE:paw:arowdvlp.cdc COMMISSION MEETING AGENDA
Meeting Date: 01/24/94
Agenda Item No: �6
DEVELOPMENT DEPARTME
STAFF REPORT
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ARROW VISTA HOUSING DEVELOPMENT PROJECT
On Thursday, September 30, 1993, Agency staff met with the Mayor, three members of the
Council and Dukes-Dukes and Associates to discuss disposition of Phase I and Phase IIA of the
Arrow Vista housing development project. As previously documented, these thirty homes and
three models represent a significant expenditure of Agency resources (approximately
$4,000,000), which when sold could be utilized towards other worthwhile housing projects.
Absent any recent sales activity, however, Agency resources remain both "tied-up" and solely
dependent on performance by the developer for ultimate recapture and re-use within the
community.
At the Redevelopment Committee meeting conducted on Thursday, October 7, 1993, discussion
regarding disposition of the Arrow Vista Housing Development project standing inventory
included the following important issues:
* Councilwoman Pope-Ludlam indicated her commitment and desire to work directly
with staff, Dukes-Dukes and Associates and the Small Business Administration
(SBA) for the purpose of removing the existing lien recorded against this project.
* Mary McGinnis, President of the Orangewood Estates Homeowners Association,
expressed her desire to utilize the existing list of potential home buyers developed
by San Bernardino Community Hospital and to keep Dukes-Dukes and Associates
in the project until final completion.
Following the October 7, 1993 meeting, the Redevelopment Committee recommended
consideration of the following motions by the Community Development Commission on
November 1, 1993:
Motion A: That the Community Development Commission authorize Councilwoman
Pope-Ludlam to work with the Agency Administrator and Dukes-Dukes and
Associates for the purpose of removing the existing Small Business
Administration (SBA) lien recorded against the Arrow Vista project.
Motion B: That the Community Development Commission allow Dukes-Dukes and
Associates to remain as a principal in the Arrow Vista project and to proceed
expeditiously with marketing and sale of existing Arrow Vista project
standing inventory.
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KJH:DRE:paw:vstadvlp.cdc COMMISSION MEETING AGENDA
Meeting Date: 01/24/94
Agenda Item No:
DEVELOPMENT DEPY CMENT STAFF REPORT
ARROW VISTA HOUSING DEVELOPMENT PROJECT
January 19, 1994
Page - 2 -
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Motion C: That staff and Dukes-Dukes and Associates utilize the San Bernardino
Community Hospital list of interested employees as a point of departure in the
marketing and sale of the existing Arrow Vista project standing inventory.
On November 1, 1993 the Community Development Commission discussed the Arrow Vista
Housing development project and the marketing and sale of existing Phase I and Phase II standing
inventory. The decision of the Commission, at that time, was to permit Duke-Dukes and
Associates to remain as a principal in the Arrow-Vista project and to proceed expeditiously with
marketing and sale of existing Arrow Vista project standing inventory for a period of sixty (60)
days. Following the sixty (60) day period, the Community Development Commission would then
re-evaluate the impact on the Agency, sales activity and the project's overall financial condition
based upon its financial condition.
In anticipation of the reconsideration of this project by the Commission on January 10, 1994, the
Development Department Housing Division provided Dukes-Dukes and Associates with a formal
request for information on December 23, 1993. Information requested included a listing of
pending sales currently in escrow, mortgage information/credit reports or applicants and weekly
traffic counts/sales performance information. The requested information was to be provided to the
Housing Division no later than January 7, 1994.
In response to the Housing Division correspondence, Continental Lawyers Title Company
submitted information on eight (8) existing Arrow Vista project escrows. The current escrow
information includes the following:
ADDRESS BUYER DATE SOLD DATE ESCROW SALES PRICE
OPENED
1729 Susie Lane 6 11/06/93 12/06/93 $130,000
1772 Pennsylvania 13 11/30/93 12/06/93 $125,000
1773 Susie Lane 8 11/29/93 12/06/93 $130,000
1728 Pennsylvania 14 11/17/93 12/06/93 $130,000
1751 Susie Lane 7 12/05/93 12/06/93 $123,000
1729 Pennsylvania 11 12/20/93 01/03/94 $125,000
1595 Clyde Street 3 12/14/93 01/03/94 $135,000
1585 Clyde Street 4 10/29/93 01/03/94 $130,000
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KJH:DRE:paw:vstadvlp.cdc COMMISSION MEETING AGENDA
Meeting Date: 01/24/94
Agenda Item No: f
DEVELOPMENT DEP/ 'MENT STAFF REPORT
ARROW VISTA HOUSING DEVELOPMENT PROJECT
January 19, 1994
Page - 3 -
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In addition, based on information received from the Northridge Management Group there were
three (3) active escrows (through Spring Mountain Escrow) and three (3) additional sales
reservations which occurred.
ADDRESS BUYER DATE SOLD DATE ESCROW SALES PRICE
OPENED
1584 Clyde Street 2 10/16/93 11/04/93 $125,000
1684 Susie Lane 9 10/23/93 11/04/93 $125,000
1685 Pennsylvania 10 11/02/93 11/04/93 $132,990
1925 Gilbert Street 1 Reservation Reservation $120,000
1695 Susie Lane 5 Reservation Reservation $123,000
1751 Pennsylvania 12 Reservation Reservation $123,000
On January 10, 1994, the Community Development Commission discussed at length the
disposition of Arrow Vista Housing project Phase I and Phase IIA standing inventory. These
discussions focused primarily on the validity of the eleven (11) currently opened escrows and three
(3) sales reservations. Based on these discussions, Agency staff was directed to investigate and
analyze the opened escrows and evaluate the likelihood of successful sales closure. This
information was requested for consideration by the Community Development Commission on
January 24, 1994.
Development Department staff has now completed a comprehensive sales status listing for the
Arrow Vista project standing inventory (Please see attached document). In addition to information
contained within the sales activity chart, the following analysis is also provided regarding the
eleven (11) previously opened escrows.
• There has been three (3) official cancellations, reducing the actual number of
remaining opened escrows to eight (8).
• The developer has executed a formal sales contract/deposit receipt on all eight (8)
remaining escrows (as required by law).
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KJH:DRE:paw:vstadvlp.cdc COMMISSION MEETING AGENDA
Meeting Date: 01/24/94
Agenda Item No: /O
DEVELOPMENT DEPT MENT STAFF REPORT
ARROW VISTA HOUSING DEVELOPMENT PROJECT
January 19, 1994
Page - 4 -
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• Deposits have been received on all eight remaining (8) opened escrows, receipts of
which have been confirmed by both the sales representative and the escrow
companies.
• Credit reports have been obtained on all eight (8) remaining "escrows". These
reports revealed one (1) "A" rated buyer, three (3) "B" rated buyers and four (4)
"C" rated buyers (Please see attached description).
• Formal loan applications have been obtained on four (4) of the remaining opened
escrows. The remaining four (4) loan applications are "in process" and should be
obtained within the next thirty (30) days based on information received from the
designated lender (Western Cities Mortgage).
It is extremely important for the Community Development Commission to note that
this stage of the home purchase process is perhaps the most important relative to
evaluation of the potential home buyer's income and debt/income ratios. Absent a
formal loan application having been obtained, there can be virtually no effective
and accurate evaluation of the buyer's financial ability to purchase a home.
• In response to Commission Member Miller's inquiry regarding prior escrows, staff
has determined that none of the existing escrows are carryover escrow previously
handled by PrideMark Homes in association with Dukes-Dukes and Associates.
• The developer also conducted a one day "open house" at the Arrow Vista project
on Monday, January 16, 1994 (Martin Luther King, Jr.) holiday. This event,
sponsored by the "Religious Community Task Force" comprised of four (4) area
churches was attended by approximately seventy-five (75) individuals. Based on
information obtained from the developer's sales representative, however, it is
currently premature to evaluate any potential sales activity which may be generated
from this event.
After thoroughly reviewing the additional sales status information obtained on the Arrow Vista
Housing development standing inventory open escrows, Agency staff continues to surface the
following issues and/or concerns:
• Dukes-Dukes and Associates has not successfully consummated an Arrow Vista project
sale since November 1992.
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KJH:DRE:paw:vstadvlp.cdc COMMISSION MEETING AGENDA
Meeting Date: 01/24/94
Agenda Item No: ��
DEVELOPMENT DEPT 'MENT STAFF REPORT
ARROW VISTA HOUSING DEVELOPMENT PROJECT
January 4, 1994
Page - 5 -
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• The Development Department Housing Division has not received any demand statements
for repayment of the Agency loan proceeds for any of the properties currently listed as
being in escrow. Typically, when a loan is about to fund, the Agency receives a demand
statement from the affected escrow services company.
• Dukes-Dukes and Associates has lowered the sales price on all three (3) Arrow Vista
models by approximately $10,000 per home. This reduction raises serious issues regarding
the availability of sales proceeds necessary to adequately repay all existing Agency debt on
this project. The developer has not yet provided any per house payout projections which
demonstrate sufficient available resources with which to lower sales prices.
• Dukes-Dukes and Associates has not indicated how the Federal Small Business
Administration (SBA) encumbrance (estimated at approximately $223,000) is to be
satisfied. Without adequate resolution of this issue, clear title to each individual property
cannot be obtained and escrow cannot, therefore, be consummated.
Successful resolution of these issues by the developer will to a large extent dictate sale of the
Arrow Vista project standing inventory. Absent resolution of these issues, there remains
serious questions regarding successful consummation of sales based upon the information
provided. In the short-term, this means the Agency will continue to incur security and
maintenance costs which approximate $17 - $20,000 per month. It is important to note these
costs significantly impact the Development Department Housing Division FY 93-94 budget and
its ability to carry out Commission approved goals and objectives.
For the heretofore mentioned reasons, staff recommends adoption of the form motion.
4
KENNETH J1 HENDERSON, Executive Director
Development Department
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KJH:DRE:paw:vstadvlp.cdc COMMISSION MEETING AGENDA
Meeting Date: 01/24/94
Agenda Item No: v
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renalcus Community
TASE IfeuclE
"Working to bring hope and change to our community. '
P. O. Boa 5220
San Bernardino, CA 92412
Jalruazy 13, 1 ?9
To: All City Council ffembers
Ref: Homeownership Expo.
CChahm = Powell 300 North D Street
San Bernardino San Bernardino, CA 924
Christian Center
Phone:885-2225
Rev.Craig S.Turley Dear Councilman,
Vice-Chairman
Mt. view Harvester Church It is a 1 ea s ure t o speak t o T y. I 1r
Phone:793-8077 P p YOU Coda I �r ,-, that
you are .Having a blessed day.
Cassandra Walker
=rdino The Religious Community Task Force will be hv_,tilag an
Christian Center evening Of Oppol-tunity. The theme will be Elie
Phone:88744489 DreI,rr. Over 25 years ago Dr. Nartin Luther- King
dream, a dream that included elrual i ty and freedom. Dr.
Dolly Rush King also spoke of a persons value and worth. Ai societ.7
1Bth�StreetSDAChumh where people would respect their fellow man. It is all of
Phone:887-3399 oui- Jobs to make this a reality. I'l:le Rvlisrious C'vmmunity
Tas1,: Force has chosen the community known as, "i'11e West
Rev.John Beckley Side" of San Bernardino to begin realizing the Di-O«:Il.
Asst.Treasurer
Eccleeia Christian FeUowehip
Phone: 881-5551 Them will be an Open 11,louse he'd at 'lie Al-rvr,r -"is a
Homes on January 17, .T 994. Located at California < nd
16th. Streets. The purpose of this gathering is t give
people in this community an opportunity tO realize t `�
BOARD OF REFERENCE: dream of 110171e ownership. We grant to e?:pose thelll i:o the .?'3
new homes that currently exist in this community, 1.1hic11
Rev.Ray Turner need to be occupied by owners. Ow;lel-S will care fol-
Temple Baptist Church
Phone: 888-2038 pi-0P'°I-ty and personal belongings much bette1" tlta.. rO:?Icc ]e
who has no stake in the mattel-. We feel that this 1.9 One
Mr.Ernie Wilson way that we can snake a difference ill our cons«unity.
Mayror's office
San Bernardino We are asking all councilpei-sons to attend this
U. important event. I know it is short 11Otice but we need
Weetsi Farmer de Division Y OUI- OI-t at this Crucial ho u,. We realize that this
eatei SLII)P wl
Area Commander issue affects all Our lives even if we don 't live on the
SSPoltaeDepartment west Side. the Open House starts at 3:30pm. and ir,
continue Until 6:001>m. There will be qualified pe.-svnnel
T°��Harris on site to handle loan applications and information needed
Baptist Church by interested parties. Please Join Us.
Phone:885-2919
Recovery Group With Hope
Cassandra Walker ROSpOC t f L111 y,
'hone: 874-4429
Philip Powell
Chairman RCT
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JRN 19 '94 06c55PM
1) CREDIT HISTORY 1) CREDIT HISTORY
• AII�mctxs md/or sovolving debt adult have :� inert and/or sarolvbgg debt is paid as speed
bow pdd as armed Any wow darbOUXy hetas far die mat past 0m than 3S%derogu Y a0dit
"a 30 day ate)mustbc ea<pWne& SW day late").
• •luau M 30 day hto paymwts l* � • No mate than two Q)30 day fate Payer vhbb
period oa m cxbdng maMps a vemontb paiod=&I mortgage isms,with a
Msxiaani m ooh(1)30 day lace payment within the maxiamm of fax'(4)30 daY•laths'within the Let
bet 12 months. 24mowh paio&
• No major derogatory items,such as Baniwptey " No m4or dmpuxy it mw sock as Baatmptcz►
a Notice of Defanlf,is the past three p) Pm. ar Nodoe of D eftuk la t M past duw(3) Ym-
2) INCOME 2) INCOME
• Empbymwt history for two CZ)ywrs. _ Empbymmt biswry for two M yews.
1) CREDIT HISTORY 1) CREDIT ffiSTORY
• Iastallmeat aadJvr revolving debt is paid m speed xm and/or rovolvlag debt loos eat eatcaod
for the most part(ices the►5096 daogatoq►credit 5096 pW insane W6 )
30!60 flay kits).
• No mono man four(4)30 day ate paymcim within No move thee ooh(1)60 day late payment whhin a
a 12-ntonm Frw oo au monme loam,with a 244s"period ad all morfgsge hens.
maximum of six(6)30 day•isles•within We last No mejor dmogatay items:,such as Banbmptcp or
Notice of D�ea at,in tiro past two(2) ym-
• No w4or&msam hems•sod►as B=kmPfcy 2) INCOME
or Notice of DeSsnir.in the past two(2) yms- . Limploymmt Harry for two CZ)yeas.
2) INCOME
• Fsnpbyment history for two(2)year.
F T HISTORY 1) CREDIT HLSTORY
ally slow pasying 3mmnment and/or • 3lradidangy slow paying h amnancet sndit
debt(Le.N-W+days). >xvdviag&ft
paymeats are=may dow,30.60+days • Mot pF prtymcets are nsualty abw,no mono film last 24-mootb period two(2)60 day and ooh(1)90 day bft PaYumts
• No==domgg ry items+such as BantnVj,►or .w Ubin a 12 mould palod oa all=wU Na loans.
No"of Default,in the past 12 months. Muiammn font(4)60 OW left psrm m s sad tyro(2)
• Borrower bwt sot estsbtiahod a atisbctory credit 90 drj Sue paymcw wlddm dte Yet 2 cm*
• may bave a disbar-A&a lsood baolaupay w16
• No tnoro� than two(2)60 day end one(1)90 dsy &-- expunedoa witbirt the peat 12 maotbs.
bu paymeau within a 1?4dw*period on an may m"a na ice at ddtadt Nod W"the past
mortmo lams. Msximtxa four(4)60 day wime u as mft wrath a twatablt:sspia "0L
2) INCOME 2) INCOME
• Bmpbymmt uml for arc yeah. anployam oc history far two yars
/ C,