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EXHIBIT 1 Natalie Verlinich, City of Santa Ana April 15, 2016 First Street Apartments: Financial Gap Analysis Page 2 The following outlines the financial gap calculations derived from the KMA pro forma analysis: Total Development Cost $28,506,000 (Less) Available Outside Funding Sources (19,711,000) Estimated Financial Gap $8,795,000 As shown in the preceding table, KMA estimates the financial gap at $8.79 million, This Is $105,000 less than the Developer's request fro $8.9 million In financial assistance. This represents a 2% differential, which can be considered insignificant. As such, KMA concludes that the Developer's financial assistance request Is necessary to provide the proposed affordable housing units. Available Funding Sources KMA estimates that $19.71 million In outside funding sources are available to the Project as follows: 1. The net operating income generated from the affordable rents supports approximately $7.02 million in permanent financing, 2. The revenue generated from the Project -Based Section B rental assistance vouchers (PBVs) provided by the Santa Ana Housing Authority (Housing Authority) supports approximately $1.46 mllllon In permanent financing. 3. The Developer anticipates receiving an allocation of 9% Federal Low Income Housing Tax Credits (Tax Credits) that are competitively awarded by the California Tax Credit Allocation Committee (TCAC). KMA estimates the net Tax Credit proceeds at $11.23 million. The Developer Is requesting $8,9 million in financial assistance from the City for the Project. The Developer intends to utilize in -lieu fee funds generated by the Housing Opportunity Ordinance (H00) as the funding source for this financial assistance request. PROJECT DESCRIPTION The proposed scope of development can be described as follows: 1604007:SA;Ta6 19090.014.001