DESCRIPTION OF THE COMMUNITY:

What is Fair Oaks Walk?
Fair Oaks Walk is the first new off campus, home ownership program of Cal Poly Pomona Foundation, Inc., built specifically for the benefit of the faculty and staff at Cal Poly Pomona. Unlike traditional home ownership, a Fair Oaks Walk buyer will purchase the home but lease the land from the Foundation, greatly reducing costs and enabling university professionals and affiliates to own a new home near Cal Poly.

As the homeowner, you will acquire a long-term leasehold interest in the land underlying your home, which will be subject to renewal upon certain stated conditions. As with any lease, you will be required to make ground rent payments pursuant to the terms of your Ground Lease, including an agreement on your part to pay Cal Poly Foundation stated future fixed rent adjustments.

To assure homes in Fair Oaks Walk remain available to, and affordable by, members of the University community, the Ground Lease includes certain restrictions. These restrictions limit the amount of the resale price, address continuing ownership eligibility and may lengthen the time required for selling a home in Fair Oaks Walk. Homes in Fair Oaks Walk must be owner occupied. You should carefully review the Ground Lease provision and restrictions before buying a home in Fair Oaks Walk. For those persons whose principal objective in purchasing real estate is capital gain, it is strongly recommended they consider acquiring a home in the unrestricted general marketplace rather than in Fair Oaks Walk or any other faculty/staff housing project offered by the Foundation.

Why was Fair Oaks Walk established?
Cal Poly Pomona is in a high-cost housing area, and it is difficult for many Cal Poly Pomona faculty and employees to afford ownership housing near the Cal Poly Pomona campus. These circumstances make it more difficult for Cal Poly Pomona to recruit and retain faculty and employees, especially with respect to those in nationally recruited positions, such as faculty who could select a job at another institution in a location where housing is more affordable. Also, keeping employees near the Cal Poly Pomona campus fosters a sense of community and participation in Cal Poly Pomona activities.

How far from campus is Fair Oaks Walk?
Fair Oaks Walk is about 7 miles from the Cal Poly Pomona campus; the drive time is about 15 minutes

What types of housing units are there in Fair Oaks Walk?
Fair Oaks has 34 Attached Townhomes. The types of homes and respective sizes are as follows:

What are the current prices for homes in Fair Oaks Walk?

What amenities are featured in Fair Oaks Walk?

• Innovative Townhome designs by award winning KTGY Architects
• Color coordinated concrete tile roofs
• Durable three coat stucco with masonry veneer
• Elegant Schlage front entry oil-rubbed bronze hardware
• Raised panel garage doors with two transmitters

• Beautiful 12”x12” ceramic tile entry
• Decorator selected carpeting
• Raised 6-panel interior doors and wardrobes
• Beautiful gas burning fireplace
• Decorator selected light fixtures
• Bull-nose edge corners, except windows and interior closets
• Package for interactive lifestyles showcasing Category 5e with phone & TV in all bedrooms
• Multi-media Outlet located in Living Room, master Bedroom and Loft (Per Plan)
• Pre-wire for Security System at all operable windows and doors.

• Beautiful white thermofoil raised panel cabinetry with concealed hinges and adjustable shelves
• White 6”x6” ceramic tile countertops with 6” backsplash
• White pressed steel kitchen sink
• Whirlpool 4-burner gas range with self-cleaning oven, microwave/hood combo & 4-automatic cycle dishwasher
• Delta single handle control chrome faucet with pull-out sprayer

• Gas forced-air heating and air conditioning system with automatic setback thermostat
• 50-gallon energy saver water heater
• Dual pane vinyl windows with low emission glass
• Water efficient elongated toilets

• Spacious Master Bedroom with walk-in closet
• Easy care cultured marble countertop with bullnose edge
• Beautiful white thermofoil raised panel cabinetry with concealed hinges
• Kohler drop-in tub with white 6”x6” ceramic tile surround, deck and apron
• White 6”x6” ceramic tile shower with 2” non skid ceramic tile floor
• Dual white china undermount sinks with polished chrome 4” centerset fixtures
• Separate commode area

• Easy care cultured marble countertop with bullnose edge
• White china undermount sink
• Full width mirrors
• Beautiful white thermofoil raised panel cabinetry with concealed hinges
• Kohler cast iron tub with white 4”x4” ceramic tile surround

Are any single-story units or handicapped-accessibility features available?
No single-level homes were constructed in this project because they would have required more land, reducing the number homes that could be built and thus the number of families that could be accommodated, and also making the financial feasibility of the project questionable. The Complex features 4 units that are Handicap accessible. The community walkways will be handicapped accessible.

What is the neighborhood setting for the site?
Fair Oaks Walk is located 25 miles east of Los Angeles in Pomona, at the foot of the beautiful San Gabriel Mountains, Fair Oaks Walk strikes the perfect balance between charming small town life and convenient city living. Enjoy local parks, great schools, shopping, dining and the nearby Claremont Village, one of Southern California’s most idyllic college town destinations. And it’s all yours with easy access to the 10, 210 and 57 freeways, plus the always convenient Metrolink.

Which public school will children living in Fair Oaks Walk attend?
The school is located in the award winning Claremont School District. Children will attend Sumner Elementary School, El Roble Intermediate School, and Claremont High School. For further information regarding the school district please visit www.cusd.claremont.edu

What is the Tax Rate?
1.25% with no Mello-Roos

What is the Monthly Association Fee?
$275 per month.

PURCHASING A HOME IN FAIR OAKS WALK

Who is eligible to purchase homes in Fair Oaks Walk?
Current Cal Poly Pomona Faculty, staff, as well as employees of other academic partners of Cal Poly Pomona: CSU Fullerton; Mount San Antonio College; Western University of Health Sciences; Claremont Colleges; school districts of nearby cities such as Pomona-Walnut-Diamond Bar-San Dimas-La Verne-Industry-Claremont; CSU Emeriti; Cal Poly Pomona alumni; Innovation Village affiliates. All purchasers must live in Fair Oaks Walk as their principal place of residence and remain affiliated with Cal Poly Pomona during their residency.

What is the Home Buyer Assistance Program?
The Cal Poly Pomona Foundation would like to provide a Faculty/Staff Homebuyer Assistance Program (FSHAP) for all full-time faculty and staff of Cal Poly Pomona, including the Cal Poly Pomona Auxiliary Organizations, wishing to purchase a home included in the Foundation’s Housing Assistance Program inventory (currently Kellogg Tract and Fair Oaks). 

The Program is designed to attract and retain faculty and staff by improving the affordability of their primary residence and provide support for new faculty and staff who have very limited access to cost-effective financial capital resources.

FSHAP will make housing more affordable by providing a source of financial assistance for the down payment needed to qualify for a loan, thus potentially avoiding the cost of private mortgage insurance and higher financing costs.

ELIGIBILITY
The FSHAP loan program will be available to all full-time faculty and staff seeking to purchase a residence from the Cal Poly Pomona Foundation’s inventory of homes.

• The maximum loan is the greater of either 20% of the purchase price of the property to be financed or $70,000; 
• The borrower will be required to personally fund at least 2% of the purchase price, although a greater amount may be required in order to qualify for certain loan programs;
• The borrower will be required to pay all costs associated with the primary mortgage, the FSHAP loan, and the closing costs to purchase the home;
• FSHAP loan would be structured in one of two formats: [1] No principal or interest payments until maturity (at which time the first mortgage would be paid off and the homeowner would be able to refinance the FSHAP loan with a traditional mortgage lender); or [2]  periodic payments of interest only, or fully amortized payments of interest plus principal, or some other fixed amount, which payments can be deferred for at least the first five years of the loan (in order to avoid having these payments count against the borrower’s qualifying ratios for the first mortgage purchase loan).
• The benchmark interest charged on the FSHAP loan will be a fixed rate equivalent to the respective long-term Applicable Federal Rate (AFR) at the time the loan is made, which is the minimum  rate specified by the IRS that avoids the tax consequences of a below-market interest rate in typical circumstances. The interest will be compounded annually. If needed to meet secondary mortgage market rules, the interest rate may be modified to as low as simple interest at 75% of the first-mortgage loan rate.  For any transactions that are not exempt under IRS below-market interest-rate regulations, the Foundation will make disclosure to the borrower and make any required report of the imputed income (for which the borrower may have an off-setting tax deduction for mortgage interest).
• The maturity date of the FSHAP loan will be the same as the primary loan.
• Loans will be in the form of a loan agreement and a promissory note secured by a second deed of trust. The deed of trust records a lien against the property for the amount of the loan and will also secure the interest to the extent possible without conflicting with first-mortgage rules regarding second-mortgage assistance loans. 

Upon the earliest of the following events listed below the principal and interest on the loan will become due and payable to the Foundation:

• Upon the sale, transfer or conveyance of title to the property;
• When the property ceases to be used as the principal place of residence for the borrower;
• Excluding the post-retirement grace period as described in Exhibit E of the ground lease, when the borrower ceases to be employed full-time by the University for non-disability-related reasons.
• Ninety (90) days following the death of the borrower except for those exceptions as described in the Ground Lease;
• Upon a default by the borrower under (i) the primary promissory note or the deed of trust securing the note or (ii) the FSHAP loan uncured within the applicable cure period or (iii) any other loan secured by an interest in the property;
• Unless sooner paid, the maturity date on the loan secured by the first deed of trust.

The borrower may repay the principal and interest outstanding according to the terms established in the promissory note at any time without penalty.

LEASE OF LOTS

How does the ground lease work?
Homeowners lease the land under the terms of the Fair Oaks Walk Ground Lease Agreement from Cal Poly Pomona Foundation for a 99-year term. Cal Poly Pomona Foundation retains the residual "fee" ownership in the underlying land. This arrangement is similar to Cal State Fullerton, UC Irvine, and Cal State Monterey Bay faculty-staff for-sale housing communities.

What ground rent does a homeowner pay under the ground lease?
Initial Basic Rent (Years 1 through 5): $500 per year, equivalent to $41.67 per month
Basic Annual Rent (Year 6 to end): $2,000 per year plus CPI Adjustment after Year 10 and after each 5-year period thereafter, equivalent to $166.67 per month plus CPI Adjustment after Year 10 and after each 5-year period thereafter.

What are the other terms of the ground lease?
The ground lease agreement between Cal Poly Pomona Foundation and the homebuyer contains program controls designed to keep the Fair Oaks Walk community affordable, available and attractive to University-affiliated buyers over time, such as restrictions on buyer eligibility, Cal Poly Pomona Foundation’s right to repurchase, and resale price limitations. It also contains terms typically addressed in ground leases such as the length of the lease, ground rent, maintenance obligations, and mortgage rights, as well as miscellaneous protections for Cal Poly Pomona Foundation and the residents. (This is not a complete summary of the Ground Lease. Please refer to the actual lease document for full disclosure)

Are pets allowed in Fair Oaks Walk?
Yes. The Covenants, Conditions, & Restrictions (CC&Rs) for the development allow for a reasonable number of household pets.

RESALE CONTROLS

What controls are on the resale price of homes?
To assure that all housing units under the Program (including the Unit) shall continue to remain affordable to persons listed on the priority list, resale price limitations shall be imposed on each resale transaction involving the Unit.  To accomplish this purpose, the Homeowner may not sell the Unit at a price greater than the Maximum Resale Price.

The “Maximum Resale Price” for the sale of the Unit shall mean the sum of the following:

The Purchase Price Homeowner paid for the Unit; plus

The product of the Purchase Price Homeowner paid for the Unit multiplied by the Fractional Change in the C.P.I.; plus

The appraised value (determined by the appraisal process described in the Ground Lease) of each Approved Capital Improvement made by Homeowner to the Unit, subject to the maximum percentage limitation stated therein; plus

The reasonable out-of-pocket costs (approved by Lessor) of incidental repairs and minor renovations made to the Unit within ninety (90) days prior to the commencement of the process of selling the Unit in order to improve the appearance of the Unit, not to exceed five percent (5%) of the sum of the indexed original purchase price, for which Homeowner has delivered to Lessor written documentation satisfactory to Lessor to evidence said costs; less

The actual costs incurred by Lessor for repairs made to the Unit as necessary to repair any damage to the Unit made by Homeowner (excluding any damage to any Approved Capital Improvements made by Homeowner and accounted for in the appraisal of the Approved Capital Improvements).

Payment of broker’s commissions or Transfer Fees (as described in the ground lease) or other costs of sale, if any, shall not affect the Maximum Resale Price.

Are there any fees payable by a homeowner upon resale of homes?
Homeowner shall pay to Lessor any and all Basic Rent, Additional Rent and any other assessments due and owing which may have been imposed pursuant to this Lease or, if any such Rent or assessment has been imposed but is not yet due and owing, pay the prorated portion that is attributable to the portion of the Year during which Homeowner held an interest in the Unit and the Common Area; pay Lessor a Lease document and preparation fee in such amount as Lessor may determine is reasonable, not to exceed one percent (1%) of the gross sales proceeds; if Lessor or its agent has acted as sales facilitator on the sale transaction by locating the buyer for the Unit and preparing the sales contract and related documents, pay to Lessor or its agent a sales facilitation fee in such amount as Lessor may determine is reasonable, but not to exceed two percent (2%) of the gross sales proceeds.  The Lessor shall have sole discretion to require that such a facilitator be used in connection with the transaction.

Lessor may offset any such fees, costs and loans against the refund of unapplied Basic Rent due Homeowner.

To whom can the homeowner resell the home?
Lessor has the right of first refusal to repurchase the Unit for a sixty-day period upon notice from Homeowner that the Unit is for sale.  If Lessor does not acquire the Unit, Homeowner may sell the Unit to other Qualified Buyers on the Lessor’s priority list.  Upon resale, the Unit will remain affordable to the next buyer through resale price controls.

Can homeowners be required to sell their homes?
The Fair Oaks Walk Ground Lease provides the Foundation with an option to repurchase a home in certain circumstances.  These relate to preserving the homes as a feasible resource for fulfilling the housing program’s goals of employee recruitment, retention, and residential community. 

• “Right of first refusal” when the homeowner decides to sell (Section 15.2). 
•  Right to terminate the Ground Lease and repurchase the home if the homeowner ceases to use it as the primary residence as required by the Ground Lease [Section 6] or otherwise defaults under the Ground Lease (example: nonpayment of ground rent) [Section 19.1]. 

“Repurchase Option Events”
An additional type of repurchase option is pegged to “Repurchase Option Events” where the use of the home would no longer fulfill the program’s purpose.  [Section 16 & Exhibit E.]  Thus, most of the Events are intended to ensure directly or indirectly that homes will be owned and occupied by eligible employees of eligible employers.

• If a buyer’s eligibility/priority to purchase the home was based on employment status, a nonconforming change in status will trigger a Repurchase Option:
• Separation from qualifying employment (example: resignation, termination, nonrenewal of contract); or ceasing to meet qualifying job criteria if any (example: fulltime / permanent).  Exception: Disability
• Retirement (for Cal Poly Pomona’s and its auxiliaries’ employees, there is a grace period of up to 5 years depending on length of service).
• If the buyer was not a fulltime employee of a specifically listed eligible employer at purchase and is still not after 5 years, then the Foundation has a repurchase option if it needs the home for program purposes.

• Ownership under :
• 50% by original buyer.  Exception: Homeowner transfer to estate-planning trust.
• 100% by surviving spouse (or legal equivalent). Exception: % of relative who helped buy.
• Occupancy is awarded to someone who is not a Cal Poly Campus employee (example: divorce proceeding).

• Default on mortgage loan (which gives the lender the right to auction the home to the public).
• Default on purchase loan sponsored by a Cal Poly entity.

Note that the Repurchase Option is a right the Foundation has, which the Foundation can choose to exercise or not in its discretion; the Foundation is not required to exercise the option.

How can I decide whether a Fair Oaks Walk home is a good investment for me?
Investment analysis for a home typically uses the "return on investment" for the buyer's sales proceeds as applied to the buyer's down-payment. (The interest carry on the home, net of tax benefits for the home-mortgage interest deduction, is treated as a shelter cost rather than an investment cost, as it is assumed that the person would have a "rent equivalent" cost if he/she did not buy a home.) Many homebuyers are putting a minimal 2% down. The example below shows how much a buyer might achieve in sales proceeds with certain historical and other assumptions (with the caveat that past performance is no guarantee of future performance). If that buyer put down 2% ($7,000), he/she would have made $3,500 (almost 50%) per year on the investment (not accounting for compounding). However, Fair Oaks Walk was designed to be a homeownership community affordable and available to Cal Poly Pomona employees both now and in the future. This condition could represent a significant restriction on Fair Oaks Walk homeowners who might otherwise benefit from extraordinary short-term appreciation in price if they owned unrestricted property in the outside real estate market.

Because of the resale restrictions and price limitations, if a buyer's primary purpose is speculative investment gain, he/she should strongly consider buying in the outside market instead, as price-indexed affordable faculty-staff housing communities will typically not provide such a level of profit. On the other hand, as the homes in such affordable communities are priced below those in the outside market, homeowners in such communities typically do not experience the dramatic losses that homes in the outside market can suffer in housing / economic downturns, and many homes sell for the maximum resale price -- unless maintenance has been neglected, or the home has been "over-improved" – but even home sellers in the outside market may not recapture 100% of the cost of many capital improvements (the incremental amount a buyer is willing to pay for a home with that improvement over a similar home without it) – for example, the recovery in the general marketplace for a swimming pool averages less than half of the installation cost. Another caveat would be that if you plan to own the home for only a short period of time, your appreciation might not defray all of the transaction costs associated with buying and selling the home, resulting on a loss on sale.

ADMINISTRATION AND MANAGEMENT OF FAIR OAKS WALK

Who administers the Fair Oaks Walk Program?
Cal Poly Pomona Foundation, Inc. administers Fair Oaks Walk. Cal Poly Pomona Foundation has contracted with third parties for home resale facilitation.

Is there a homeowner’s association?
Homeowners will have input into community management through a Homeowner’s Association (HOA). The HOA will make recommendations on proposed homeowner exterior improvements, make suggestions on community management issues, mediate homeowner disputes, sponsor activities, and take other actions concerning Fair Oaks Walk.

OTHER INFORMATION

How can I get more information about Fair Oaks Walk?
Information is available at www.fairoakshousing.com. You may call 909.596.6019 or visit the sales office at 141 E. Foothill Blvd., Pomona, CA 91767.

Sales Hours of operation are Friday – Monday  10:00am – 5:00pm.

Terms and Limitations

The foregoing is intended as general information about the Fair Oaks Housing program. This site is intended for general reference and informational purposes only. The Cal Poly Foundation does not warrant or make any representation of any kind with respect to the above information. Information contained herein is subject to change at any time.