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More motel conversion projects may help ease OC’s housing crunch

Within the next few years, Orange County may learn the outcome of a vital experiment: whether converting motels into permanent apartments is one of the fastest, cheapest and most effective ways to create new affordable housing and get people off the streets.

The county, working with several cities and home developers, already has been approved for $40 million in funding from the state’s Homekey program, more applications are in the pipeline, and several projects could be under construction by this fall.

And some city officials say converting motels, especially those that may be run down or have generated complaints about illegal activities, can be a win for the community because it removes blight.

But the endeavor has its own challenges, like getting the properties for a reasonable price and figuring out where to place people who may already be using a motel as their home.

Projects in the pipeline

Launched in 2020 and now a multi-billion dollar initiative, the Homekey program grew out of Project Roomkey, Gov. Gavin Newsom’s effort to get some of the most vulnerable people on the streets into hotel rooms to protect them from COVID-19.

Homekey provides state funding for communities to buy hotels and convert them into permanent housing, typically with services such as case management and job placement for those who need them.

Two projects on deck in Orange County are two motels in Stanton that are still housing some of the people who moved in as part of Roomkey.

Work will start soon at the Stanton Inn & Suites and Tahiti Motel, which will provide a combined 132 units of permanent supportive housing when they’re done by sometime in 2023.

The county also recently announced it was awarded $17 million to convert a 65-room Quality Inn on Beach Boulevard south of Warner Avenue into apartments, some of which will serve chronically homeless people.

Officials, including Anaheim Mayor Harry Sidhu, left, can be seen outside the Recreation Center at Buena Esperanza during the grand opening celebration on Monday, August 23, 2021. The converted motel offers permanent housing and other social services to at-risk residents. (Photo by Mindy Schauer, Orange County Register/SCNG)

The county is waiting to hear about funding to overhaul two more properties, the 20-unit Riviera Motel in Stanton and the 88-unit Motel 6 in Costa Mesa, which would total nearly $16 million more in Homekey dollars.

Anaheim, which has its own Housing Authority and can apply for funding without going through the county, should know later this month if it will receive state funding for the $25 million conversion of Studio 6, a 119-room motel on Harbor Boulevard by the 91 freeway, city spokeswoman Lauren Gold said.

That funding would cover buying the property, a first phase of construction and five years of operations.

Beyond Studio 6, “we are looking at several other properties to invest the Homekey funds in. From our own project we’ve seen how that transformation can really work,” Gold said, referring to Buena Esperanza, the new name of a 69-unit Econo Lodge the city worked with Jamboree Housing to renovate into affordable apartments. It opened last summer.

Challenges ahead

Stanton Mayor David Shawver said his city has been working to address homeless issues for years, and first Roomkey and now Homekey are building on the work already done.

As tourism shifted away from locals making stopovers on their way to the beach, some of Stanton’s older hotels were neglected and crime flourished there, causing the city to spend “a great deal of taxpayers’ dollars just on enforcement,” Shawver said.

Since people were settled in the Roomkey motels last year, it’s cleaned up Beach Boulevard and Katella Avenue, he said.

“We don’t have the meth labs blowing up, we don’t have the prostitution, we don’t have the crime,” Shawver said, adding, “I have not received one complaint (about the program) from one resident or business owner.”

Doug Becht, the county’s director of care coordination, was just as positive, saying, “these types of projects, there’s no losers in them. Everyone wins.”

But not every project works out perfectly.

Last year Anaheim sought and received $5.1 million from the state to renovate the 26-room Kona Inn, but after negotiating with the owner, city officials had to abandon those plans when they couldn’t agree on a price, Gold said. She noted Anaheim will be able to use the money for another hotel conversion.

Michael Massie, Jamboree Housing’s chief housing development officer, said his company has also pursued projects that didn’t go forward because the price stopped making sense.

And sometimes figuring out options for people who are already living in a motel – it’s considered “housing of last resort” for some – can complicate a project.

That’s what public interest lawyer Brooke Weitzman, who has represented homeless people in civil rights lawsuits, is worried about with the Stanton motels slated for Homekey-funded renovations.

The phone number of her nonprofit, the Santa Ana-based Elder Law and Disability Center, is on grievance forms for the residents there, so she hears about their concerns.

Those who are still living there – the motels were turned into transitional housing when the county began phasing out Project Roomkey in late 2020 – were glad to get in, Weitzman said, but are now facing uncertainty and confusion about where they’ll go when construction starts. Some have heard they might need to be out of their rooms by the end of this month.

In her conversations with the county’s attorneys, Weitzman said it’s not clear there’s a plan to find everyone suitable housing – and she wants to hear a firm commitment that no one will be forced back onto the streets or into a group emergency shelter.

“People are scared to lose the closest thing that they’ve often had in many years to housing.”

Massie said Jamboree has an April 1 deadline to close on some financing for the project and construction needs to start soon, but there’s room to accommodate the people who are already there.

About three-quarters of the motel residents “are connected to a permanent housing resource,” and the county has until the end of August to work on placements for the remainder, Becht said.

The difficulty is the desperate shortage of affordable homes the Homekey projects are intended to ease. Weitzman said if the pace of building new units doesn’t pick up, the numbers of homeless will continue to rise.

Massie said he knows motel conversions, while they help, won’t fix the problem alone.

“Housing is a crisis that’s been building for decades. It’s going to take a lot of different solutions to solve it.”

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