Affordable Housing Group Receives $1 Million Grant

Neighborhood Housing Services of the Inland Empire has secured $1 million in funding through the Southern California Association of Governments’ Lasting Affordability Program.

The organization plans to use the grant in two key ways. Part of the funding will support the group’s Healthy Homes Wellness Fund, which helps cover early development expenses tied to affordable housing projects. Officials say the effort could help advance construction of roughly 400 affordable housing units in the region.

Another portion of the grant will assist about 40 families with down payment support, helping them move toward homeownership.

Neighborhood Housing Services of the Inland Empire was founded in 1981 by three World War II veterans who aimed to expand housing opportunities for underserved communities.

SCAG also awarded $5 million to Rancho Cucamonga-based nonprofit National CORE. The organization plans to direct those funds toward its housing catalyst program, supporting 27 infill developments expected to create more than 2,500 affordable housing units across Los Angeles, Orange, Riverside and San Bernardino counties. Several of those projects will include permanent supportive housing.

Regional leaders say expanding housing options remains one of Southern California’s most pressing challenges.

New Fitness Center Planned for Temecula

EōS Fitness is preparing to open a new location in Temecula, replacing a former craft retail space.

The new gym will occupy roughly 35,000 square feet at the Commons at Temecula shopping center on Winchester Road, where a JOANN Fabric and Crafts store previously operated. The center also includes tenants such as Nordstrom Rack and Ulta Beauty.

The fitness facility, expected to open next year, will offer a variety of exercise equipment along with recovery and wellness amenities. EōS Fitness currently operates dozens of locations throughout Southern California, which represents the company’s largest regional market.

Behavioral Health Center Opening in Southwest Riverside County

A new behavioral health provider is preparing to launch services in Temecula later this spring.

Terra Behavioral Health plans to open its facility in April, offering several levels of care for adults dealing with mental health conditions and substance use challenges.

Programs will include residential treatment, partial hospitalization, intensive outpatient care and virtual therapy options. The center will also work with physicians, therapists, hospitals and community partners to accept referrals.

Company leadership said the goal is to provide local treatment options so residents do not have to travel long distances for care during critical moments.

Commercial Truck Fueling Center Sold in San Bernardino

A newly developed commercial fueling facility designed for large diesel trucks has been sold in San Bernardino for $3 million.

The fueling site sits next to a 7-Eleven convenience store and traditional gas station near the intersection of Redlands Boulevard and Hunts Lane. The facility is part of the company’s 7FLEET commercial fueling network.

According to real estate brokerage Hanley Investment Group, the buyer was a private investor based in Orange County, while the seller was Glendale-based developer Chase Partners Ltd.

The fueling lanes are designed specifically for heavy-duty commercial vehicles and occupy roughly two acres of land.

Fontana Distribution Facility Sells for $30.2 Million

A newly constructed industrial building in Fontana recently changed hands in a $30.2 million transaction.

The 113,930-square-foot warehouse sits on Mango Avenue and includes features designed for logistics operations such as high ceilings, multiple loading docks and expanded electrical capacity.

Magellan Value Partners sold the property, with DAUM Commercial Real Estate Services representing the transaction. The building’s new occupant is expected to be a clothing distribution company headquartered in New Jersey.

Leadership Appointment at Riverside Community Hospital

Citlalli Rojas, managing partner of the Inland Empire office for New York Life Insurance Company, has been named chairwoman of the Board of Trustees for Riverside Community Hospital.

Rojas said the hospital holds personal significance for her family and emphasized her commitment to supporting quality healthcare services for the region’s diverse population.

She said the hospital plays an important role in serving the community and ensuring families across the Inland Empire have access to compassionate medical care.

The post Inland Empire Business Briefs: Housing Funds, New Gym, Behavioral Health Center and Major Property Deals appeared first on The Hemet & San Jacinto Chronicle.

What the project lacks is money. 

Having quilted together a financial patchwork of local government and corporate grants, private debt, and a plot of land donated by a foundation, it remains just shy of the total needed to break ground. 

Six years and 13 funding applications after it was first proposed, the Morris Village project sits ready, but waiting.

An estimated 39,880 affordable units across California are stuck in financial purgatory, according to a new report by Enterprise Community Partners, a national nonprofit that funds, consults and advocates for affordable housing. That’s 461 “shovel-ready developments” that, like the one on East Morris, are fully designed, legally green-lit and backed with a significant — but still insufficient — amount of money.

Many have “been sitting for a year or two waiting for funding,” said Justine Marcus, policy director for Enterprise’s Northern California office and one of the report’s co-authors. “There’s no exit route right now. It’s a bottleneck.”

For many developers and affordable housing advocates, that bottleneck represents an especially frustrating inconsistency of California public policy. Lawmakers are desperate to see the state build more homes — of all kinds, but especially for people with the least ability to pay the state’s exorbitant rents. State housing regulators have ordered local governments to plan for the construction of an additional 2.5 million units by the end of the decade. One million of those are supposed to be for people making less than 80% of each region’s median income. 

As a general rule, that’s a population of hard-up renters that the private market has been unable to profitably serve at scale. To fill that gap, non-profit low-income housing developers typically turn to taxpayer-funded support. At the moment, according to the report, there isn’t enough of that to go around.

Enterprise took publicly available but hard-to-parse applicant lists from seven subsidy programs administered by various wings of California’s state government going back three years. With a combination of number crunching and a little inference, the report estimates that clearing the current backlog would require an extra $4.1 billion, split between state administered grants, low-cost loans and tax write-offs.

Once awarded, this final layer of state subsidy has to be spent in relatively short order. That means this list of 39,880 units comprise a group of affordable housing projects that are all but ready to go, said Marcus. “They kinda have to have their (stuff) together.”  

Case in point: Two-thirds of the projects on the list have already received support from at least one other state program. Those dollars aren’t awarded to just any developer, said Betsy McGovern-Garcia, vice president of Self-Help Enterprises, one of two non-profits behind Morris Village.

“These are all projects that are close to amenities,” she said. “These are all projects providing resident services. These are all projects that are financially feasible…They are all meeting the bar for what we want to see as a state out of our affordable housing community.”

In February, McGovern-Garcia and her colleagues applied for a final round of financial support from the state “to close the gap” and finally start construction.

“We are optimistic this might be our round,” she said in an interview, her fingers crossed. 

A moving bottleneck

California has seen gridlock in affordable housing production before, but the precise location of the traffic jam has changed over time. 

When Nevada Merriman was leading a team of affordable developers in Silicon Valley a decade ago, she said local approval was the major hold-up. Getting the legal okay to build low-income housing on a particular site in a particular town required developers to run a gauntlet of planning department and city council meetings, win over hostile neighbors with costly concessions, community meetings and design revisions and to fend off the ever-present possibility of litigation. Because relatively few projects survived that ordeal, the competition for funding on the other side wasn’t especially stiff, said Merriman, who is now policy advocate for MidPen Housing, an affordable developer in San Mateo County. 

That began to change earlier this decade. California lawmakers began passing laws overriding these local impediments — especially for affordable projects. All of a sudden more projects were clearing those early regulatory hurdles and competing for Low-Income Housing Tax Credits, the federal government’s signature affordable housing construction subsidy. The bottleneck moved further up the road.  

But then that too began to change late last year. Buried in President Donald Trump’s signature tax bill from 2025 was a significant boost to the tax credit program. (Specifically, the law increased the total supply of one type of credit while allowing another kind to be spread out over twice as many projects).

Which brings us to the latest bottleneck. 

Now projects can get through local approval. They can more easily acquire the final and most important layer of federal financing. But project sponsors typically can’t apply for that until all other financial holes are plugged. 

“We’re looking for state sources to fill that gap,” said Merriman. “We want to make sure we don’t leave those federal sources on the table.”

MidPen currently has 1,198 units spread across seven developments waiting for that last bit of funding, she said. “Should there be a source…there’s a pipeline that is ready to go.” 

California’s last major infusion of public affordable housing dollars came in the form of a voter-approved bond in 2018. That well has run dry. A hodgepodge of funding streams remain.

Adding together funding that has already been approved by legislators but not yet spent and a variety of other state and federal sources, California’s Housing and Community Development department says at least $1.8 billion should be available for affordable developer applicants this year. Gov. Gavin Newsom’s budget proposal for the coming fiscal year doesn’t include any new discretionary spending beyond that.

Boosters of more funding have reasons to be optimistic. Newsom has taken such an austere posture in early budget negotiations before only to have the Legislature successfully pour hundreds of millions of dollars of affordable housing subsidies back into the final budget agreement.

California lawmakers are also considering a record-breaking $10 billion affordable housing bond for the 2026 ballot. If a majority of voters go for that, “we’d be off to the races,” said Merriman. 

Cutting costs

One way to get more affordable housing built is by spending more money. The other is trying to make the existing money go further by cutting costs. 

The cost of affordable housing construction is notoriously high in California: A 2025 study estimated that tax credit-financed projects here cost two- to four-times the amount of comparable projects in Colorado and Texas. There is no single reason for this disparity. Land costs in California are significantly higher. So too, often, is the cost of labor. Regulatory barriers like restrictive zoning, slow permitting and stiff impact fees are frequently named as culprits. Sometimes old-fashioned construction methods and materials get blamed.

But there’s also the cost of just waiting around.

A typical affordable development in California will have two or three public funding sources, with some drawing on six or more. Many of these sources are awarded on their own timelines. Each has its own program-specific requirements that can take time to meet. Some are conditional on the receipt of another. As time goes by, developers still have to make payroll, pay interest on pre-construction loans and watch as inflation drives construction costs up further. As delays compound, funding sources that have already been secured might expire, setting things back further. 

Each additional funding source delays the start of construction on a project by an average of four months, adding an extra $20,460 per unit, according to an analysis by the Terner Center for Housing Innovation at UC Berkeley.

The Newsom administration is currently tinkering under the hood of California’s affordable housing finance system in an effort to speed things up.

Last year, the governor proposed the creation of the state’s first ever cabinet-level housing agency. The California Housing and Homelessness Agency is scheduled to take over the state’s disparate housing loan and grant programs. The governor’s office also proposed legislative language that would force the new agency and the Treasurer’s Office to operate in tandem, giving affordable housing developers a single place to apply for the state’s various funding programs — and to cut out some of the time they spend stuck in line.

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The future’s looking grim for affordable housing projects across California.

Housing developers and advocates hung their hopes on Proposition 5, a measure rejected by voters that would have made it easier to raise local funding for affordable housing and public infrastructure projects. Meanwhile, as President-elect Donald Trump prepares to take office, no one expects the federal government to dole out more money for subsidized housing.

“We can’t sugarcoat the fact that this is a significant setback,” said Susannah Parsons, director of policy and legislation at All Home, a Bay Area housing justice advocacy group. “We are running low on public funds for housing. We are facing significant headwinds.”

Housing took center stage in state and national elections this November as more Americans feel the pinch of rising rents and a shortage of affordable housing. However, the results of the election have California affordable housing developers concerned that a shortage of public funds will put a stop to some of their projects.

According to a May report from the Metropolitan Transportation Commission, almost 41,000 affordable homes and apartments in the Bay Area are in the pre-development phase, meaning developers still need a certain amount of funding — collectively, about $9.7 billion — to start construction. Without that money, the projects sit idle as other funding sources, sometimes contingent on each other, disappear.

Proposition 5 could have unleashed more funding by lowering the threshold for approving local bond measures for housing and infrastructure from a supermajority of 66.67% to 55%.

Sarah Karlinsky, research director for the UC Berkeley Terner Center for Housing Innovation, likens the complicated funding structures for affordable housing to a layer cake.

“There are many different sources of funding for affordable housing at the state level and different departments and parts of the government that control different pieces, and then affordable housing developers kind of have to knit all of them together,” she said.

Karlinsky said there will be increased competition for what funding is still available, while projects that can’t get enough will be pushed further into the future.

“We know it’s going to be extremely challenging because it’s been hard enough as it is,” said Noni Ramos, CEO of Housing Trust Silicon Valley, an affordable housing development financing organization. “Now we’re in a position where it’s going to be even harder to do this work.”

The defeat of Proposition 5 was a particularly big blow because it was one of the only large-scale funding efforts put to voters after a Bay Area-wide $20 billion housing bond and a statewide, billion-dollar housing bond both failed to get to the ballot.

Still, there were some successes at the local level. San Francisco voters overwhelmingly approved Measure B, a $390 million bond that includes funding for homeless shelters. Los Angeles voters approved Measure A, a sales tax initiative that would raise an estimated $1.1 billion per year for housing and homelessness efforts.

As proponents and opponents seek to understand why Proposition 5 failed, they agree that the measure’s complicated nature was its biggest setback.

When voters don’t understand a measure and how it would impact them, they are more likely to vote against it, according to Mark Baldassare, statewide survey director for the Public Policy Institute of California.

“The people who put it on the ballot really did not promote what it was in a way that connected the dots for people,” he said.

Proponents fear that the opposition campaign may have swayed voters at a time when people are concerned about high costs. While Proposition 5 would not have increased taxes, it would have made it easier for bond measures to pass locally, potentially meaning higher property taxes. Opponents said the proposition was “deceptive” and that it would “trick voters into approving the tax-hike measure.”

“I think voters vote for measures that benefit the social good when they feel more flush,” Karlinsky said. “They may not feel like they have anything left over for others.”

Susan Kirsch, a Proposition 5 opponent and the director of the Catalyst Institute for Local Control, an organization focused on local control in housing development, was relieved that voters rejected the measure. She feared its passage might have meant higher taxes for people like her, a home-owning senior living on a fixed income.

“We know that there’s already more people moving out of the state because of California’s high taxes,” she said. “I would feel much more vulnerable in terms of how those taxes would keep coming in.”

As for future elections, affordable housing developers and advocates are regrouping and debating whether to reintroduce a regional or statewide bond measure or a version of Proposition 5.

Heather Hood, the vice president of affordable housing advocacy group Enterprise Community Partners, said the onus is on local agencies and organizations like hers to plan for future funding.

“In the face of the federal administration, we’re going to need to be more efficient with our dollars and mightier with our will,” she said. “It seems to me that we’ve collectively managed to be divided and nit-pick at each other, and we don’t have time for that anymore.”

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