SMDP Photo

Homeless researchers and service providers know that the status quo approach to solving homelessness in Los Angeles County is failing and failing badly. 

The $1.2 billion in affordable housing funding provided by the 2016 ballot measure Proposition HHH has so far only delivered around 1,200 of its 10,000 promised units with project costs ranging as high as $837,000 per housing unit. Additionally, it is estimated that on a daily basis in LA County around 200 people become housed and 227 fall into homelessness.

Simply put, the County is not building housing fast enough and cheap enough to stem the tide of people falling into homelessness.

However, subject matter experts are not hopeless. Indeed they are far from it and believe there are a host of more efficient, cost-effective and innovative solutions ready to be applied and adapted, so long as politicians and the public are willing to step up and support them.

“As a community in Los Angeles, we don’t really support and fund innovation… and the entrepreneurship folks who have actually good ideas and better ideas that could build [housing] faster and cheaper,” said John Maceri, CEO of homeless service provider The People Concern, later adding, “I think what’s so frustrating for those of us who are practitioners is we know it can be done, it’s all the obstacles and barriers on the system side that really prevent us from doing so.”

In a panel discussion with affordable housing developer Greg Comanor and Associate Director of the RAND Center for Housing and Homelessness in LA Jason Ward, Maceri examined a series of policies that could get people housed faster and cheaper. 

Two policies the panelists were in strong support of were adaptive reuse and master leasing.

Adaptive reuse converts existing buildings into housing projects and aims to tackle the supply side issue of the housing crisis. 

Currently, Los Angeles County is notoriously slow at building new affordable housing projects. 

The process is delayed by a series of factors including community NIMBYism, the bureaucratic permit approval process and complicated requirements to secure public sector grant funds. It is also made worse by costs of inflation, rising labor costs, high land value, supply chain delays and the high cost of building materials.

Adaptive reuse eliminates or lessens several of these challenges. Construction costs are significantly cheaper because the structure does not need to be built from scratch and the zoning and permitting process is often faster for existing structures. In addition, adaptive reuse typically receives less community push back.

“If there’s an office building sitting with a big ‘for lease’ sign on it and everyone drives by it every day and that building suddenly becomes housing, [for] many people it wouldn’t really matter much,” said Comanor. “A lot of the work to reuse buildings is just a little bit less obnoxious from sort of a neighbor perspective.”

Comanor said that motel structures are a prime candidate for adaptive reuse as they are already designed to accommodate housing and there is a built in incentive for building owners who can stand to earn more profit from apartment rentals than motel rentals. 

A successful recent example of this is Project Homekey, through which the California Department of Housing and Community Development provided a collective $1.4 billion to municipalities statewide to convert structures like motels into homeless housing with supportive services. So far in Los Angeles County this program has created 1,051 homes.

According to Comanor office buildings are also good candidates for conversion as many of these structures are currently vacant. The economics of  adaptive reuse for office buildings is slightly more challenging as these property owners are accustomed to high office rents.

Comanor also said that the City of LA has a large role to play in enabling adaptive reuse by streamlining the permitting and approval process for affordable housing developers. 

The second policy that panelists focused on is master leasing, whereby a homeless service organization agrees to lease a property’s units and will then sublease them to unhoused clients. This policy seeks to increase the number of landlords who are willing to accept formally unhoused tenants who will pay rent using housing vouchers.

“Our organization basically provides the full faith and credit of the organization and the rental subsidy to lease the unit and then we have the right to sublease it and we generally use those for our clients who have a very hard time accessing housing because of poor work histories or credit histories,” said Maceri.

According to Maceri, master leasing also provides the benefit of rent stabilization as these leases are typically for five to ten year terms. 

“In this inflationary time rents are going up substantially and a master lease will control that, so it does play a role in affordability,” said Maceri.

The panelists discussed a number of other innovative and cost saving strategies to house more homeless individuals. Most of these strategies shared a common thread of eliminating the bureaucratic steps currently required to fund housing production.

Although they acknowledged that Proposition HHH has so far failed to deliver on its promises, the panelists urged voters to remain open minded when considering future ballot measures to fund housing. 

“I think that it’s hard to dismiss the concerns of people that say, you know, ‘I voted to raise a lot of money six years ago, why does everything look the same as or worse?’,” said Ward. “I think at a certain point, you’ll see these dollars pay off and I think there are a lot of really useful lessons to be learned.” 

Ward said he believes future ballot measures could be designed more intelligently based on the County’s experience with HHH. For example, he supports the idea of a ballot measure that would provide funding for all aspects of homeless supportive housing at once, even if it means funding less overall units. 

“You can create another large source of funding that says hey the entire bill is for building projects really rapidly and then you wouldn’t have to sit around and wait two years to get low income housing tax credits and put together three other bonds, [revenue] sources and all these sorts of things,” said Ward.