BAHFA partnership preserves affordable housing in St. Helena

Two apartment buildings in St. Helena will maintain their affordable rents – and the tenants will keep their homes – thanks to a partnership between a local property owner, nonprofit housing organization and the Bay Area Housing Finance Authority's (BAHFA) Housing Preservation Loan Pilot.

The two six-unit buildings were owned by St. Helena residents, who had been renting the Monte Vista apartments at below-market rates since they bought the properties in the 1990s. When they decided to retire from the landlord business, they wanted to ensure the buildings’ continued affordability and the stability of the 41 current tenants.

Our Town St. Helena (OTSH) was able to buy the buildings with a $3 million, 55-year loan from BAHFA; a $750,000, 20-year permanent loan from Poppy Bank; and a charitable sale by the building owners, who significantly discounted the price for a below-market sale in exchange for a seller’s tax credit. OTSH, a nonprofit dedicated to preserving and building affordable housing in St. Helena, plans to contract with Burbank Housing for property management and asset management of the properties after acquisition.

BAHFA’s Housing Preservation Loan Pilot preserves affordable housing and protects residents by helping mission-driven housing developers to acquire and rehabilitate residential properties that are then converted to permanently affordable housing.

“Without the reduced sale price and financing from BAHFA, OTSH could not have justified the purchase because the lower rents could not support the ongoing property costs including management, maintenance and capital improvements,” said OTSH Board Member Michael Collins. “The OTSH Board of Directors is so appreciative of the sellers’ stewardship of the properties and their sacrifice to make this transaction happen. The wellbeing of the residents was a driving factor for them.”

St. Helena is a small, rural town in northern Napa County. Its primary industries are agriculture, tourism, hospitality and retail. A minimum-wage earner must work three full-time jobs to afford the town’s average rent of $2,582. The residents of the Monte Vista apartments are employed in the trades, retail, hospitality, winery and food service sectors. If their homes were sold to a landlord who wanted to raise the rents, it’s unlikely any of the tenants would have been able to stay in St. Helena.

"Preserving homes that are affordable for all Napa County residents is important to the continued health of the county and its industries,” said Belia Ramos, Napa County supervisor and president of the Association of Bay Area Governments. “The partnership between BAHFA, OTSH and the previous building owners demonstrates that with planning and coordination, keeping homes affordable and preventing tenant displacement is possible.”

BAHFA established the Housing Preservation Loan Pilot with $17.8 million in Regional Early Action Planning Grant (REAP 2) funding from the state of California to help mission-driven housing developers achieve preservation and anti-displacement goals. To date, $17.25 million has been distributed to five projects in San Francisco, San Jose, Oakland, Sonoma and St. Helena through the Housing Preservation Loan Pilot.

The program provides low-interest loans to nonprofit developers and community land trusts to acquire and rehabilitate residential properties occupied by low- and moderate-income residents. These properties must also be located in eligible geographies that incorporate state and regional priorities. More information is available on the Pilot webpage.