LA City Council green-lights $83 million deal to turn Mayfair Hotel into housing for homeless

The Los Angeles City Council on Friday, Aug. 18, gave the green light for Mayor Karen Bass’ administration to purchase the Mayfair Hotel, not far from skid row, to convert into a permanent interim housing facility for the homeless, despite continued objections from those who live or work near the hotel about potential safety issues.

The council voted 12-2 to approve spending approximately $83 million to purchase and renovate the 294-room historic hotel, and to pay for associated costs, as part of the mayor’s Inside Safe homeless initiative.

A $60 million “encampment resolution” grant from the state to pay for operations at the site stipulates the money must be used to serve individuals from skid row — the epicenter of the region’s homelessness crisis. Because of that, the Mayfair Hotel is expected to only house individuals from skid row during the first two years of operation.

But once the grant expires after two years, priority for living at the Mayfair, located at 1256 W. 7th St., would go to individuals in Council District 1, where the hotel is located. Councilmember Eunisses Hernandez, who represents District 1, made that request before the council’s vote.

That request was in addition to other amendments added to the motion, which the councilmember introduced earlier this week to enhance sanitation and safety services in the Westlake neighborhood immediately surrounding the hotel. Nearby residents and business owners have complained about unsafe or unsanitary conditions when the Mayfair was used as a Project Roomkey site to house the homeless for two years during the COVID-19 pandemic emergency.

“My hope is that just as we provide wraparound services for our individuals and families who are in need of care, we can also wrap around the community that surrounds this hotel – a community that too often has been overlooked and underserved by our city,” Hernandez said.

“I believe that we can lead the way in showing Angelenos that when they say ‘yes’ to housing in their neighborhoods, that their city meets them with the support and the services they need for their communities and neighbors to thrive,” she added.

The council’s vote to purchase the Mayfair Hotel marked a major win for the mayor, who, in her inaugural speech a day before she took office had called on all Angelenos to “lock arms” in the effort to combat homelessness and said that every community must allow housing for the homeless in order to be part of the solution.

“We need to do all that we can to get Angelenos off the streets and into temporary housing as fast as possible while permanent housing is still being built. … Together, with actions like this, we can sustain our momentum toward confronting the homelessness crisis,” Bass said in a statement.

According to her office, there will be round-the-clock security inside and outside of the hotel and comprehensive services will be provided to residents, including access to medical, mental health and substance abuse treatment providers; navigators to help individuals find permanent housing; and case managers. There will also be opportunities for residents to participate in social activities and various programs.

The city is projecting the purchase and renovation, along with associated costs, to add up to about $83 million. That includes approximately $60.2 million to purchase the hotel “as is,” before renovations.

Members of the Bass administration say it will save the city a significant amount of money longterm to purchase properties it can own and convert into housing for the homeless, compared to paying nightly room rates to hotel and motel owners as it’s currently doing for Inside Safe participants.

According to a recent report by the city’s General Services Department, it’s projected to cost $47.22 per night to operate a single room at the Mayfair – a figure which the mayor’s office said increases to about $83 a night if one included the costs of purchasing and renovating the hotel.

That’s still cheaper than the $114 average nightly cost for an Inside Safe motel room or the $154 to $183 nightly rate at the L.A. Grand Hotel, cited in the report. That would add up to annual savings of tens of thousands of dollars per room.

The city currently has leased out rooms at the Grand Hotel as interim housing for the homeless, but that lease will end early next year. It’s expected that individuals living at the Grand would transfer to the Mayfair Hotel by Feb. 1.

Not everyone is on board with the plan, however.

Several residents and business owners near the Mayfair showed up to Friday’s council meeting to urge officials to put the brakes on acquiring the hotel until more community input had been taken.

During a recent townhall and in public comments before various council committees this week, they described a neighborhood overrun by drug users, people engaged in other illicit activities or homeless people congregating outside the building when the Mayfair operated as a Project Roomkey site. They spoke of sidewalks littered with trash, syringes and, at times, feces, and said they did not want a repeat of that scenario.

“It was horrible — turned the block into a nightmare. Us business owners had to go around carrying weapons to protect ourselves,” said business owner Nami Oh.

Meanwhile, more than 15 members of the public, including some homeless service providers, spoke in support of the Mayfair purchase.

Officials from the Bass administration have maintained that as an Inside Safe operation, residents will receive wraparound services. The Mayfair won’t be operated the same way it was under Project Roomkey, which focused solely on getting people housed during the COVID-19 emergency without providing comprehensive services, they said.

To further address some of the concerns raised by those who live or work near the Mayfair Hotel, councilmembers added a number amendments to the motion to approve the purchase of the facility. These called for enhanced street and sidewalk cleanings, bus shelter maintenance and regular public trash pickups, as well as a street lighting improvement plan for the affected neighborhood, as well as the formation of a community advisory board.

Though the majority of the council voted to move ahead with the purchase on Friday, several councilmembers – including Hernandez – acknowledged they still had questions and concerns. Councilmember Monica Rodriguez cast the dissenting vote, saying she felt the process was rushed.

The city must close on the deal by Aug. 31 because of a deadline set by the hotel owner, according to a city staff report.

Rodriguez also said she found it “offensive” that the city paid at least $11 million in damages caused by residents living there during Project Roomkey, yet the hotel owner never made the repairs and is now selling the facility to the city in “as is” condition. That means the city will have to pay for renovations.

“We’re paying twice,” Rodriguez said.

Councilmember Bob Blumenfield said although the city would take possession of the Mayfair before repairs are made, the purchase price was lowered to reflect the hotel’s current condition. He added that repairs the city will make should cost less than $11 million because the city won’t be replacing high-end furnishings with similarly high-end items but instead would purchase furniture at a lower cost.

He said it was “unfortunate” the city had already paid out for the damages, but that at the end of the day, L.A. needs more housing.

“We need interim housing,” he said. “The streets cannot be the waiting room for permanent supportive housing.”