Los Angeles Buys ‘Luxury’ Apartments With ‘Sweeping Views’ to House Homeless

The City of Los Angeles has embarked upon an aggressive and novel plan: provide housing for all of the city’s homeless. The inherent problem with the plan is obvious: the more you provide, the more you incentivize homeless people to come. A recent investigation of the plan has also revealed that the project suffers from gross mismanagement and likely corruption.
“Homekey makes grant funding from the state Department of Housing and Community Development available to cities, counties, housing authorities, tribal entities and other local public entities to acquire and then convert hotels, motels, multi-family apartments, and more, into permanent or interim housing,” it stated.
This falls under the left’s strategy to “never let a serious crisis go to waste.” The acquisitions are made by the city’s “Housing Authority.” The city not only purchases and operates the properties, but it also upgrades the buildings to provide on-site services and amenities.
Thus far, the investigation revealed, the city has acquired 2,750 housing units (condos, apartments, or hotel rooms) at a cost of more than $810 million, or about $300,000/unit. But, according to the investigation, around 44 percent of the units sit vacant.
The city fails at maintaining its streets, sidewalks, parks, sewage, power, beaches, and buses. Yet now it seeks to be a player in the commercial real estate, property management, and landlord business.
It should come as no surprise that the investigation revealed the city is way overpaying for the properties. Commercial real estate is a sophisticated business. Governments are in no position to compete with private companies which have been in the business for decades, with only the best surviving and the worst going bankrupt. The government has no expertise in this area. Further, such projects are ripe for political payoffs, fraud, and kickbacks.
The investigation also revealed that additional “luxury” buildings were acquired, yet still had to be upgraded or modified to accommodate homeless. For instance, they bought a hotel but then had to convert thirteen rooms into “program space (supportive service staff offices, property management staff offices, service provision areas, and a community room for activities)” and for “two, two-bedroom managers’ units.”
Units are also likely to sit empty because a good percentage of homeless do not want housing. They have adjusted to life on the street and prefer the lack of oversight and rules. As long as the city continues to allow people to set up camps on the city’s beaches, parks, and sidewalks, they will continue to do so.
The reason is obvious. The more you permit camping and cater to the homeless, the more you incentivize the behavior. While other states enforce no-camping laws, people leave those states to camp in cities like Los Angeles and San Francisco, which allow it. It’s set to get worse now that the word is out that if you camp in L.A., you are likely to be offered a brand-new loft with a view of the Hollywood sign.