Jamboree Begins on First Supportive Development Under Anaheim’s Motel Conversion Ordinance

Rendering of 2691 W. La Palma a motel conversion in Anaheim
Amidst National Mental Health Month, Jamboree and the City of Anaheim announced today that construction has begun on its 2691 W. La Palma Conversion, the City of Anaheim’s first conversion to supportive housing under the city’s new motel conversion ordinance. With construction of Manchester-Orangewood – a capstone housing development for 102 working families in the Haster Orangewood neighborhood – already under way in April, the 2691 W. La Palma Conversion will provide 69 studio apartments of supportive housing for veterans, individuals living with mental illness, and those formerly homeless. When complete, this will be Jamboree’s ninth affordable housing development with the City of Anaheim, a partnership that has added more than 600 affordable homes to Anaheim’s housing stock since 2008.

In 2018, the County of Orange announced the 2,700 Permanent Supportive Housing Plan, which called for the creation of 2,700 supportive housing units across the county, effectively ending chronic homelessness in the region. As homelessness continues to rise in Orange County and throughout California, motel conversions have shown promise as a swift way to build more supportive housing units at a lower cost. However, motels are rarely zoned to allow permanent housing of any kind – as was the case with the 2691 W. La Palma Conversion.

Addressing the issue in 2019, the City of Anaheim Planning Department, Community & Economic Development staff, and City Council collaborated with Jamboree to move forward a Zoning Code Amendment that would allow for the conversion via a Conditional Use Permit process, the first ordinance of its kind in Orange County. “What makes Jamboree unique is its ability to bring solutions to the table when faced with hurdles in developing affordable and supportive housing,” said Jamboree President and CEO, Laura Archuleta. “We’ve been building for 30 years, and I think the combination of our expertise and experience is a proven asset to city’s looking to address these issues at the policy and zoning level.”

This new entitlement process has now been adopted into a citywide Motel Conversion Ordinance, providing a more streamlined approval process that serves as a model for how to address the homelessness crisis in other municipalities throughout Orange County.

“As mayor, I’m proud to see that Anaheim continues to be a leader in addressing homelessness,” said Anaheim Mayor Harry Sidhu. Underscoring the increased focus to solve homelessness, Mayor Sidhu noted, “In the past several years, we’ve worked to get more than 2,000 people off our streets and on a pathway toward a better life – the transformation of this site will change even more lives here in Anaheim.”

In addition to zoning and entitlement challenges, Jamboree also needed to secure a bridge loan to close escrow on the former motel building, until the 2691 W. La Palma Conversion project was ready to close construction financing on April 30, 2020. Always at the forefront of innovative affordable housing financing, Jamboree partnered with Providence St. Joseph Health – as part of its Community Benefit Fund – on a $9 million bridge loan for the 2691 W. La Palma Conversion project. Noting Jamboree’s importance as a community health partner, Providence St. Joseph Health presented an extremely competitive interest rate, nearly half the percentage rate of other offers. This saved Jamboree hundreds of thousands of dollars on the overall project cost.

“Jamboree is an established partner for Providence St. Joseph. Over the last few years, we’ve had the opportunity to partner together on a program that connects patients discharged from a specialized psychiatric emergency room at our hospital in Orange with one of Jamboree’s special needs homes in Anaheim – a collaboration with proven success,” said Timothy Zaricznyj, Executive Director of Providence Supportive Housing. “This type of partnership demonstrates how healthcare partners like Providence have a meaningful role to play in the creation of more supportive housing in Orange County and beyond.”

Jamboree was able to repay the Providence St. Joseph Health bridge loan – both on time and in full – thanks to established funding relationships with the County of Orange that allowed Jamboree to effectively leverage County Mental Health Service Act (MHSA) dollars. “This represents a win for everyone,” said Archuleta. “Healthcare partners, private businesses, and anyone looking to invest in proven homelessness solutions know that Jamboree has the expertise to create a quality project – one that is financed accurately and leads to cost savings for all financial partners.”

Located in West Anaheim, the blighted motel will be transformed into a Spanish-style, two-story building, with updated exterior landscaping, new resident interior/exterior amenities, furnished outdoor courtyards, public art, and residential-quality façade elements that will help transform the commercial motel into an attractive residential apartment building. Jamboree and the City of Anaheim have prioritized quality design for all past affordable housing developments to create a safe, attractive and healthy living environment for future residents – and to ensure the property becomes an asset to the surrounding community.

With the studio-apartment layout of the 2691 W. La Palma Conversion, special attention is being given to the design of the community space, which will serve as a critical place for resident socialization and services. Central to the success of permanent supportive housing is the emphasis on access to stabilizing services, which will be provided by the County of Orange and Jamboree’s onsite resident service coordinators.

The 2691 W. La Palma Conversion is the second Jamboree project to receive funding from the newly revitalized Orange County Housing Trust, a nonprofit run by NeighborWorks OC, that partners with the Orange County Business Council (OCBC) to make private, “last-mile” funding available for affordable and supportive housing development in Orange County. “In recent years, Orange County has begun to strategically address chronic homelessness in our communities. I credit a large part of this new focus to Orange County business leaders who have stepped up to ensure that last-mile funding is available for supportive housing developments,” said Lucy Dunn, OCBC CEO. “The transformation of the former motel site is yet another example of how our business community is bringing projects from concept to reality via the Orange County Housing Trust.”

Financing for the $25.3 million 2691 W. La Palma Conversion consists of $12.2 million in construction financing and $6.9 million in tax credit equity by U.S. Bank; $5.8 million in permanent financing by California Community Reinvestment Corporation; a $1.2 million Low Moderate Income Housing Asset Fund loan from the City of Anaheim; a $9 million MHSA loan from the County of Orange, and a $2 million loan from Orange County Housing Trust.
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