The 27-unit luxury apartment building on Alvardo Street was purchased for $11.2 million. Fourteen months later it is still empty.
(Editor’s note: Westside Current printed the first of a three part series that documented of the number of buildings purchased to house homeless, 45 percent remain vacant. Part 2 asks why apartments purchased exclusively for the homeless remains vacant.)
By JAMIE PAIGE and CHRIS LEGRAS
As reported in an exclusive Westside Current Investigation click here, two years after Los Angeles spent over $800 million using Project Homekey and other funding sources to purchase 38 buildings for homeless housing during the pandemic, more than 1,200 units – 45% – remain vacant. Many have been empty for more than two years.
In Part II of an ongoing series, we look at why.
California Governor Gavin Newsom
Project Homekey was an ambitious plan to provide rapid housing solutions for homeless individuals during the pandemic. The initiative, launched by California’s Department of Housing and Community Development (HCD), aimed to purchase and convert existing buildings into interim and, ultimately, permanent supportive housing. Governor Gavin Newsom touted the program as a way to “build quickly, and at a fraction of the usual cost, to deliver much-needed affordable homes for Californians struggling to find a place to live.”
The implementation of Homekey in Los Angeles has encountered numerous challenges. In email and telephone interviews with city, county and state officials, analysis of hundreds of pages of publicly available documents, and conversations with subject matter experts, we discovered that responsible agencies, including the Los Angeles Housing Department, the Housing Authority of the City of Los Angeles (HACLA), and the California state Department of Housing and Community Development (HCD) are aware of the vacancies. However, there is no consensus among the various departments and agencies as to the underlying causes.
In response to emailed questions from the Current, California state Department of Housing and Community Development (HCD) spokeswoman Alicia Murillo attributed the delay in part to a statewide shortage of building materials.
She wrote, “Lumbar [sic] is a big reason for the delay. The state also said there is an electrical component that over the last two years has had a one-year backorder and has caused dozens of our projects to be delayed purely because of this one electrical component, projects that cannot get electrical to their building.”
Over the last two years, partly as a result of the COVID supply chain crisis and partly as a result of ongoing inflation, developers are facing shortages. However, given that one of Homekey’s central goals was to purchase housing that could be brought online as quickly as possible, we wanted to understand why so many of the properties need upgrades and retrofitting before occupancy.
The Housing First approach mandated by the state requires that all units come with comprehensive supportive services, including case management, healthcare, and employment assistance. This holistic model aims to not only house individuals but also provide the necessary support to help them transition out of homelessness permanently.
We contacted Mayor Karen Bass’s office. Her spokesperson, Zach Seidl wrote: “Homeless housing units sitting vacant is completely unacceptable. The Mayor’s Office has been working aggressively to eliminate inefficiencies like this as we confront the homelessness crisis and thousands more people came inside last year than the year before. Inaction and complacency will not be tolerated.”
According to Housing Authority of the City of L.A. (HACLA), the requirements include office and living quarters for on-site service provider employees and communal spaces for support services and meetings. This often means converting living units, which reduces the supply for homeless and increases costs. The retrofits also include adding kitchenettes to hotel and motel rooms that do not have them.
These extensive requirements are particularly surprising in the context of the brand-new buildings the City purchased, as well as Extended Stay hotels that already include features like kitchenettes, business centers, and meeting rooms.
In our investigation we discovered four such hotels that had been serving as interim housing for several hundred people, but HACLA is in the process of vacating those residents. Why? To make upgrades to buildings that already have extensive features.
In addition to sources of delay identified by the state (lumber and an electrical component), the city pointed to additional lengthy and specific requirements for the federal Americans with Disabilities Act (ADA) compliance as a contributing factor.
A spokeswoman from HACLA told the Current although buildings must meet basic safety and ADA standards to be granted a certificate of occupancy, there are additional requirements when the building is repurposed for homeless housing. Additional upgrades can include the installation of new fire alarms, sprinklers, electrical systems, and egress routes.
Finally, another common issue is the need to relocate existing residents after the City purchases properties. For example, when the City purchased a new apartment building at 5050 W. Pico in 2022 it paid more than $400,000 to relocate 13 existing tenants.
According to HACLA’s publicly available records, the agency will spend more than $10 million on consultants to relocate hundreds of residents from four former Extended Stay Hotels in order to convert them into permanent supportive housing.
The City paid $36.5 million for this property on Pico. Then paid an additional $400,000 to relocated 13 existing tenants.
A slow, seemingly inefficient process
The Current reviewed City Planning Department permits and applications for a number of Homekey buildings. The former Extended Stay at 6531 South Sepulveda Blvd. near the Howard Hughes Center has fewer than ten clients left.
However, according to Department of Building Services (BDS) records, the City has not filed any significant construction permit applications in the two years since buying it, despite ongoing promises to secure housing for remaining residents.
On a site visit we spoke to one of the remaining residents, who will need to vacate the Extended Stay. In response to questions, she said she had not been offered housing at a different location yet and was not sure where she was going to go. She called the process “confusing and frustrating.” Our conversation was interrupted when an employee from the location’s service provider approached and demanded that we leave “private property.”
The remaining 10 residents at this Extended Stay near the airport are required to vacate it – leaving them “homeless,” again.
A former motel at 9250 Airport Dr. is just starting the process of removing and relocating residents before being converted from interim to permanent supportive housing, slated to be finished by the end of 2024. However, according to publicly available BDS records only a small number of non-significant and unrelated permits were issued in 2021 and none have been sought or granted in the three years since. It is unclear when upgrades will start.
Some properties appear to have been occupied despite a lack of upgrades or retrofits. A new 34-unit apartment building at 11050 Hillhaven Ave. in Sunland-Tujunga received a certificate of occupancy on October 28, 2022. HACLA purchased it on November 18, 2022. The City did not pull any additional permits for upgrades or retrofitting. Two months later, on January 20, 2023, CD 7 Councilwoman Monica Rodriguez announced that residents had started moving in. Despite no physical changes, the building remains full today, including an on-site service provider.
Hillhaven calls into question the various agencies’ explanations for the delays in getting people housed in Homekey properties. If that building could be filled barely two months after purchase, why are other properties still empty more than two years after purchase?
Officials starting to take action
Coordinating services and ensuring retrofits and upgrades are in place before the units can be occupied (or reoccupied) adds layers of complexity. The city’s efforts to comply with these requirements have often clashed with the urgency of addressing immediate housing. One thing on which everyone agrees is that the process is moving too slowly to meet the demands of the crisis.
Traci Park
That may be starting to change. On Wednesday, CD 11 Councilwoman Traci Park introduced a motion that would instruct the City Administrative Office in conjunction with the Los Angeles Housing Department and HACLA to “provide a comprehensive report, within sixty days, on the status of Homekey 1,2, and 3 sites.” The report would include the total number of properties purchased, and the number of occupied, vacant, and available units.