Ravello lands $ 55 million for affordable Palmdale project
Developer Ravello Holdings is taking its first steps into affordable housing in Los Angeles.
The local company has secured $ 55 million in funding to build 118 housing units in Palmdale.
Merchants Capital financed the debt, which is divided into two parts. Ravello and Merchants announced the news on Friday.
It provided a three-year $ 31.6 million construction loan and provided a $ 24 million Fannie Mae loan. The Fannie portion consists of a housing tax credit for low-income people, as well as a permanent loan that will eventually replace construction financing.
The Ravello project will include 81 units reserved for residents earning no more than 60 percent of the region’s median income, and 36 units reserved for residents earning no more than 50 percent of the MAI. One unit is reserved for building staff.
The company bought several plots for the site for $ 2.3 million in November, records show.
Two-bedroom units at the 50% AMI level will start at $ 1,178 per month, according to Ravello. Three-bedroom units from the same AMI will start at $ 1,351 per month.
Ravello and its development partners Ascenda Capital and WNC & Associates said California’s new housing density bonus legislation helped make the project viable, as did Fannie’s funding. Under House Bill 2345, developments with affordable units may benefit from relaxed zoning and design requirements, in addition to financial incentives.
Affordable construction benefited from bond money. LA City Council last month provided $ 58.5 million in bond financing for two affordable housing projects, one in Winnetka and the other in Boyle Heights.
Ravello, based in Sawtell, focuses on housing developments for students and seniors. CEO Phil Ram said the Palmdale project is an attempt to address Los Angeles’ “urgent need” for affordable housing.
LA County lacks about 500,000 affordable housing units, according to a recent report.