HomeMy WebLinkAboutNB-5 - 26-181 - DRAFT Commitment Letter - 3/17/2026Commitment Letter
[COSTA MESA LETTERHEAD]
March __, 2026
Jamboree Housing Corporation
17701 Cowan Avenue, Suite 200
Irvine, CA 92614
Attn: Michael Massie
Re: 70 Unit Affordable Housing Apartment Project Known as Costa Mesa Senior Apartments
Located in Costa Mesa, California (“Property”)
Dear Mr. Massie:
The City of Costa Mesa (the “City”), now commits itself, subject to the terms of this letter, to make
a construction and permanent mortgage loan ("Loan") on the following terms and conditions:
Borrower: A to-be designated limited partnership in which Jamboree Housing
Corporation (or a limited liability company controlled by Jamboree
Housing Corporation) is the general partner
Collateral: Deed of Trust
Loan Amount: $750,000 in HOME funds
$2,500,000 in Affordable Housing Trust Fund funds
Construction Term: 3 years.
Permanent Term: 55 years
Annual Payments: A proportionate share, in the amount of 9%, of the soft lenders’ 50%
share of residual cash flow
Interest Rate: 3% per annum simple interest
Non-Recourse: The Loan shall be non-recourse to Borrower and the partners of
Borrower, subject to customary non-recourse carve-outs for losses
incurred by the City resulting from fraud, misappropriation, willful
misrepresentation, and bad faith waste.
Prepayment Fee: None
Collateral: The Loan will be secured by a third priority deed of trust (“Deed of
Trust”) encumbering the Property. The Deed of Trust shall be
subordinate to: (i) the lien of the deed of trust securing a construction
and permanent loan from an institutional lender (the “First Deed of
Trust”), and (ii) the lien of the deed of trust securing a construction and
permanent loan from the County of Orange (the “Second Deed of
Trust”). The City agrees to execute and deliver the institutional
lender’s standard form of subordination agreement in order to
evidence the subordination to the First Deed of Trust and the County
of Orange’s standard form of subordination agreement in order to
Attachment 1
Costa Mesa Senior Apartments – Commitment Letter
March _, 2026
Page 2 of 3
Commitment Letter -2-
evidence the subordination to the Second Deed of Trust, provided that
in both such subordination agreements City receives customary notice
and cure rights acceptable to the respective senior lender.
Loan Documents: The Loan shall be evidenced by a promissory note and secured by the
Deed of Trust.
Commitment
Expiration Date: December 31, 2028
Special Terms
and Conditions; The portion of the Loan comprised of (i) the HOME funds and (ii)
$1,500,000 of the Affordable Housing Trust Funds shall be provided
as a construction and permanent source and will be funded at such
time as Borrower has obtained commitments for the financing,
investment equity and tax credits for the Project. If requested by the
first lien lender, the construction proceeds of the Loan will be held by
the first lien lender and disbursed in accordance with the terms of the
first lien lender’s loan documents. The remaining portion of the Loan,
comprised of $1,000,000 of the Affordable Housing Trust Funds, shall
be provided as a permanent source, and will be funded at permanent
loan conversion.
This Commitment contains the entire understanding between Borrower and the City with respect
to the Loan, supersedes all prior oral or written communications, and may not be modified or waived
except in writing, and signed by the party to be bound thereby. This Commitment and all Loan
Documents shall be governed by California law. This Commitment to make the Loan is personal
to Borrower and is not assignable or transferable by Borrower, except that Borrower shall be able
to assign this Commitment to a limited partnership in which Borrower (or a limited liability company
controlled by Jamboree Housing Corporation) is the general partner.
Please indicate your acceptance of this Commitment by signing and returning the enclosed
duplicate original copy.
Yours very truly,
________________,
By:
Name:
Its:
Costa Mesa Senior Apartments – Commitment Letter
March _, 2026
Page 3 of 3
Commitment Letter -3-
The foregoing Commitment by the City to make the Loan is hereby accepted, and the undersigned
agrees to accept the Loan, and to borrow the funds thereunder, in accordance with all of the terms
and conditions set forth in this Commitment.
BORROWER:
JAMBOREE HOUSING CORPORATION,
a California nonprofit public benefit corporation
_____________________________________
Michael Massie, Executive Vice President and
Chief Development Officer
Date: _____________, 2026