CALEXICO — In what will ultimately be a $20 million project, the Calexico City Council unanimously approved moving forward with a $5.8 million grant application that would see the city partner with a nonprofit developer to provide housing for seniors and “vulnerable populations” in the old Hollie’s Hotel on Imperial Avenue.
Developer Ray Roben, who is working with the city and representing an affordable housing developer called Mirka Investments LLC, told the council during a special meeting Aug. 26 that the Hollie’s Hotel project would occur in two phases.
Roben said the first phase would access the $5.8 million in state grants to do emergency and health and safety-related repairs to the project site that would enable seniors and “vulnerable populations,” or formerly homeless families, to move into the 43-unit project.
The second phase would see the seniors and others living in the property down the road then be temporarily housed in hotels while a $16 million remodel of the project is undertaken.
The city is co-applicant with Mirka Investments, which Calexico City Manager Miguel Figueroa has explained, is submitting the application on behalf of the city. Mirka Investment has the technical expertise and capacity to submit the grant application, while the city is responsible for the entitlement processing and approval, he stated prior to the Aug. 26 meeting.
The funding amount is for $5,840,663 through the state Department of Housing and Community Development Department’s Homekey program.
Figueroa stated the city would be the lead co-applicant for a proposal to pay for the substantial upgrades to 801 Imperial Ave. and complete several items on the “conditions of approval listed on the conditional-use permit for the Hollie’s Hotel conversion into a senior and vulnerable population facility, including the retention of existing commercial facilities.”
In addition to the main Hollie’s property at 801 Imperial Ave., attached commercial spaces are included and an adjacent property around the corner at 18 Lincoln St., would all be used to develop the 43-unit complex.
Expenditures and certificates of occupancy for the development must be completed by Dec. 30, Figueroa explained.
“This represents Phase 1a of the overall Hollie’s Development Strategy; Homekey leverages state funds to complete a lot of the tenant improvements, including the installation of a modern fire-suppression system, replacement of the water line and re-pavement of the alley directly to the east of Hollie’s,” Figueroa stated.
Figueroa assured members of the council who asked whether the project would be a liability to the city, and that such partnerships are commonplace with municipalities. Calexico has several senior apartment complexes built through similar processes, which often utilize tax credits for the nonprofit developers.
Roben acknowledged that would be the process for Mirka.
Roben went before the council on July 27 to get a conditional-use permit on the project approved. After that meeting, there was much criticism regarding the project via social media because people questioned housing senior citizens alongside “vulnerable populations,” which many thought meant chronically homeless persons.
Roben explained July 31 that anyone considered as part of that population living in the facility would likely be families, women or children who have received multiple services, have already gone through emergency or transitional housing, and would be establishing more permanent homes.
City to Move Ahead with Land Negotiation
The council unanimously approved Figueroa entering into an “exclusive right” to negotiate with George Egbuonu of REO Investment Group on two parcels of city-owned land just outside city limits at Kloke and Maddox roads.
The undeveloped land is zoned for agricultural use and is just east of Kloke Road and just south of Maddox Road west of Calexico city limits, in the city’s “sphere of influence,” Figueroa said.
The parcels are each 14.16 acres and 26.05 acres and valued at $1.81 million as of a 2017 appraisal, according to backup information prepared by city special counsel Seth Merewitz of BBK law firm.
Council member Bill Hodge asked if there was anything the land could be used for in the city.
Figueroa explained it was intended to be used for some sort of industrial development similar to where the new FedEx shipping center is in north Calexico.
He added that the city can “impose” terms of whomever buys the land that something beneficial to the city is built there in a reasonable time frame and not just sat on by the purchaser.
“The city sent out the attached Notice of Availability (for the parcels) on June 3, 2020 and received back interest from one party. The city manager seeks authority to enter into a 90-day exclusive right to negotiate agreement with George Egbuonu,” Merewitz stated in his report to the council.
The parcels were donated to the city in 2017, Figueroa said.
“This is not a need, this is an opportunity,” Figueroa said, adding if the sale is in the best interest of the city.
Council Conducts Hearing on COVID Grant
The council conducted a public hearing Aug. 26 and gave direction to the city manager to seek “expedited” payment of $171,000 in state Development Block Grant Program funding specifically tied to COVID-19 to establish a “forgivable loan program” for small businesses in the city.
Under the eligible activities of the program, according to back up in the agenda prepared by contract city planner Christopher Velasco, the funding could be used for homeownership assistance and housing rehabilitation programs, public facility and public improvements projects, including public improvements in support of new housing construction, public service programs, planning studies, economic development business assistance, and microenterprise activities.