San Diego looking to convert hotels to house homeless now in Convention Center

In what’s being called a new approach to quickly finding housing for homeless people, the San Diego Housing Commission has applied for state funding to help acquire two hotels that could be converted and ready for use by 340 people by the end of the year.

“These are often-used phases I don’t use lightly, but this is a new paradigm,” said Rick Gentry, president of the San Diego Housing Commission. “If this all plays out, it will be a game-changer. And you’ve never heard me use that term before.”

The Housing Commission has bought and converted nine hotels over the last 12 years, but many required extensive and costly renovations. The commission-owned Hotel Churchill, for example, required two years of refurbishing at a cost of $20.6 million.

The new approach is to purchase hotels ready for occupancy, with each unit containing a kitchenette to make it more like a home.

“We’ve come up with at least two properties, maybe more, that are fairly modern, in good shape,” Gentry said. “They wouldn’t need too much extensive work. Maybe slap a coat of paint on them, but that’s about it.”

If it does play out, the first occupants could be from the shelter in the San Diego Convention Center, which has about 1,000 people. The spacious shelter opened in April amid concerns that city shelters were too crowded during the coronavirus outbreak.

With the pandemic still active, the city has not predicted when the Convention Center shelter will close, but there already is some discussion about what to do when that day comes.

Bob McElroy, president of the Alpha Project, one of three service providers overseeing the shelter, has made a pitch to house people in converted shipping containers that could be quickly assembled and installed.

Gentry said that and other ideas are worth exploring, but he is optimistic the purchase and quick conversion of hotels is a responsible, viable option.

In April, the Housing Commission investigated the purchase of 10 hotels but ended up walking away from each because they weren’t good fits. Gentry said the experience provided some lessons, and since then the search has been shifted to two deemed suitable, with a third also being considered.

Gentry said part of the money for the purchases would come from the state’s $600-million Project Homekey fund, created by Gov. Gavin Newsom this year to house homeless people at high risk of COVID-19.

Seeking some of that money, the Housing Commission submitted an application two weeks ago for $27.7 million, the maximum amount that could be allocated to San Diego County, one of eight regions eligible for the Project Homekey fund.

The state also is setting aside $120 million that would come from money left over by regions that did not use their full allotment.

Gentry said the Housing Commission is applying for $10 million from that fund, bringing the total from the state to $37.7 million.

The Housing Commission and city of San Diego also will help fund the purchase, and Gentry said the final cost of the two hotels will be about $120 million.

He credits Mayor Kevin Faulconer with pushing for the idea of hotel purchases, and Gentry said they were hoping something like Project Homekey would be proposed. Newsom announced the fund in July.

Faulconer said in an email that he backed the idea.

“By converting hotels into hundreds of permanent homes, the city and county of San Diego have an opportunity to continue to lead the state in creating new solutions to reduce homelessness,” he wrote.

Gentry said the only missing piece to satisfy the state’s requirement for the funding is wraparound services that must be provided in the hotels for two years. That could come Tuesday when the Board of Supervisors meets to discuss and approve the county’s $6.4-billion budget.

Supervisor Nathan Fletcher has proposed the county amend the budget to allocate $5.4 million for the Health and Human Services Agency to provide the behavioral healthcare to people who will live in the buildings, satisfying the state’s requirement for the Homekey money.

“We indicated we’d get the money from somewhere,” Gentry said about the state application. “And it should come from the county. The county would be serving these folks anyway.”

If the board doesn’t support the amendment, Gentry said money for the services will be found elsewhere so it won’t be a deal-breaker to get its Project Homekey allocation.

Warth writes for the San Diego Union-Tribune.