Construction is expected to get underway in October for a new affordable housing community in Davis.

Mutual Housing California announced final funding approval this week for two new affordable housing communities — including one on Fifth Street in Davis — that are expected to be ready for occupancy in early 2022.

Mutual Housing at 5th Street will consist of 38 one-, two- and three-bedroom apartments in a single three-story building adjacent to the Sterling student housing complex currently under construction. Residents will include very low- and extremely low-income families, with 16 apartments reserved for residents participating in a mix of Yolo County programs that support both homeless families and transitional age youth.

The other project that received final funding approval Tuesday is the region’s first intentional affordable community for LGBT seniors, Lavender Courtyard by Mutual Housing, in Sacramento.

The approvals by the California Tax Credit Allocation and Debt Limit Allocation Committees represented the final funding hurdles for both projects, including the $22.2 million Mutual Housing on 5th Street complex.

The Davis project is being funded by $10 million in low-income housing tax credits and a tax-exempt bond; $9.4 million in Proposition 1 funds; $414,000 in City of Davis HOME funds; and $370,000 from the Federal Home Loan Bank’s Affordable Housing Program. Wells Fargo is providing a $15.3 million construction loan.

The one-acre parcel on Fifth Street and a $2 million contribution were provided by the Dinerstein Companies, developer of the Sterling market-rate student housing complex.

Mutual Housing CEO Roberto Jimenez said the Fifth Street community “will add dozens more affordable apartments for families that have struggled to survive amid the high cost of rent in the region, a situation that has been exacerbated by the coronavirus pandemic.”

Lavender Courtyard, meanwhile, “will include a wide range of resident services and activities that will bolster the LGBT culture to ensure that for the people who live at Lavender, getting older will not mean getting forgotten and abused.”

“These two communities will add to our portfolio of affordable housing for low-income households in the Sacramento and Yolo County communities,” Jimenez said.

— Reach Anne Ternus-Bellamy at [email protected] Follow her on Twitter at @ATernusBellamy.