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Council approves $1.2 million loan for Ridgeway Hotel renovations

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The City Council approved a $1.2 million loan from the city Housing Authority Tuesday for renovation of one of 10 residential hotels located in downtown Sacramento – a project that will result in 22 studio apartments for low- to very-low-income residents.

The four-story, 58-unit Ridgeway Hotel, at 914 12th St., was built in 1921 and renovated in 1987, according to a report from the Sacramento Housing and Redevelopment Agency.

“It has been vacant and boarded up for the past several years,” Sacramento Housing and Redevelopment Agency Executive Director La Shelle Dozier said Tuesday. “It was designed in an old style with small units that had to share bathrooms and kitchens. It’s really in need of repair now.”

CFY Development Inc. is one of the partners in the investor group that will be doing the renovation. The other partners are Aegis Group and David Rutledge, who represents the nonprofit arm of the partnership.

Ali Youssefi, vice president of CFY, said this is one of many SRO projects that CFY has undertaken in its history, but it is the first where he has taken the role of general partner.

“CFY is an affordable housing developer, so we do large family projects, senior projects and SROs,” Youssefi said Tuesday.

Youssefi said the proposed renovations will reduce the number of units from 58 to 22, but will enlarge each unit to allow for more livable space.

“It was common for these old residential hotels to have many units on each floor that shared one bathroom and kitchen,” Youssefi said.

“In reconfiguring the units, they will go from 18 (units) per floor to seven per floor,” he added.

Each completed studio will be between 350 to 500 square feet, Youssefi said.

CFY plans to refurbish the hotel inside and outside, including new electrical, mechanical and plumbing systems and providing amenities for residents such as on-site laundry facilities and secure parking for bicycles and mopeds.

Dozier said the project will be funded by a combination of financing including federal tax credit dollars, private equity investment by the developer/owner CFY Development, and the Housing Authority loan.

The city of Sacramento is required by ordinance to regulate and maintain an inventory of 712 SRO units within the city limits.

When the 58 units at Ridgeway are withdrawn from the city inventory for the renovation, they will be replaced by units at another project, keeping the city inventory intact.

When the property owners of SRO buildings want to renovate or change the use of the building, the owner must get permission from the city through the regulating agency, Sacramento Housing and Redevelopment Agency. The property owners and the regulating agency must also establish a replacement housing plan so the city inventory is not impacted.

Dozier said the 150-unit housing project at 7th and H streets that is nearing completion will serve as replacement units for the withdrawn Ridgeway SRO units.

Eligibility for renting an SRO unit is based on income – usually capped at 30 to 60 percent of the average median income for the city.

At a 30 percent cap, the income level would be $15,990, and at 60 percent is would be capped at $31,980.

Youssefi said CFY will apply for federal tax credit funding this week and, once they receive a funding award, renovations can begin on the Ridgeway as soon as mid-November.

Renovation is expected to take from 12 to 18 months, Youssefi said.

Melissa Corker is a staff reporter for The Sacramento Press. Follow her on Twitter @MelissaCorker.

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