Mayor Todd Gloria wants to transform a vacant warehouse near downtown into a massive 1,000-bed shelter.
Gloria in coming weeks plans to pitch to the City Council a 35-year lease for the nearly 65,000 square foot former print shop at Kettner Boulevard and Vine Street in Middletown.
City officials envision providing hundreds of beds plus meals, case management and around-the-clock security at the site and will need to add amenities such as showers, a commercial kitchen and dining areas before a shelter can open there. For now, Gloria’s hoping that can happen in 2025.
Gloria’s office said after a Thursday press conference that the city initially expects to spend $30 million annually to operate the facility and $1.9 million a year on lease payments. His team expects to ask the City Council to approve up to $18 million for building improvements.
Gloria thinks the tab for what would become the city’s largest-ever permanent homeless shelter – and a new long-term lease commitment – will be worth it.
“This is substantial,” Gloria said. “There’s no two ways around this, but again the cost of inaction is more when you see homeless individuals relying on the EMS system for their healthcare, cycling in and out of jails, the need for public sanitation services to clean sidewalks where there are encampments … those costs add up.”
Gloria said he expected to rely on the city’s day-to-day fund, state homelessness grants and philanthropic support to press forward despite a hefty projected budget shortfall for the fiscal year that begins in July.
His team’s early vision for the facility includes 715 beds in a large open warehouse area on its lower level, another 108 beds on a second level and 184 beds for families on another upper level.
Gloria said the 1,000 new beds would fulfill a pledge he made during this year’s State of the City address to add that number of beds to the city’s shelter system. He said Thursday the beds would be net additions to the city system rather than replacements for sites including Golden Hall and 16th Street and Newton Avenue that eventually must close. He also said the new proposal doesn’t mean the city is backing away from a controversial plan to use H Barracks, a former public safety training center near Liberty Station, to serve homeless residents. (Gloria said the plan for H Barracks is now to use the site as a 200-space safe parking site for people living in vehicles though it could also house other homeless services in the future.)
The mayor’s move toward a large-scale warehouse shelter could concern City Councilmembers and advocates who have raised questions about investments in large, bustling shelters that some homeless San Diegans avoid.
Gloria and Councilmember Stephen Whitburn, who represents downtown, said at a Thursday press conference that the new plan aligns with the city’s commitment to provide a more diverse array of shelter options – from safe camping sites to non-congregate options – and to deliver many more beds.
They argued the 35-year lease would ensure the city has access to a 1,000-bed facility for many years to come – and that now-common waits for shelter beds are eliminated.
“With a shelter of this size with 1,000 beds, people will not have to wait to get into a shelter in the way they have to today,” Whitburn said. “This is a gamechanger.”
As Whitburn noted, the new beds would also increase the city’s ability to enforce its camping ban throughout the city since the ordinance only allows police to crack down in certain areas when shelter beds aren’t available.
On most days, city shelter beds now fill up before noon – and many homeless residents who want shelter can’t access it.
Gloria also argued the 35-year lease commitment – which also comes with two five-year renewal options – makes sense even if the city decides in coming decades it no longer needs such a large homeless service facility.
“If this issue is not as acute as it is, this facility is very flexible and I believe could be repurposed to something else if we are in the fortunate position to not necessarily need it for sheltering services,” Gloria said.
Why the Deal Could Be Under the Microscope
Past city real estate debacles – including the 101 Ash St. scandal and the city’s controversial purchase of a shuttered East Village skydiving center – mean there will likely be increased scrutiny of the long-term lease deal, the Middletown warehouse’s building’s condition and its ownership.
Voice of San Diego confirmed that San Diego real estate and hospitality guru Douglas Hamm purchased the property for $13.25 million on Tuesday after months in escrow.
Real estate broker Rob Brown, who represents a seller he declined to name and initially did not identify Hamm, said the property’s new owner had been in escrow since fall 2022 and got a six-month extension late last year.
Brown said Tuesday was Hamm’s deadline to close.
“We weren’t gonna give him another extension,” Brown said.
Brown said he wasn’t aware of Hamm’s plan to rent the facility to the city and convert it into a shelter.
Hamm did not respond to a request for comment.
County records show CALFA Holdings Five LLC previously purchased the warehouse from longtime owner Packard Properties Inc. in 2015 for $8.3 million.
Christina Bibler, the city’s economic development director, said the city has communicated with Hamm about the property’s history.
Gloria spokesperson Rachel Laing later said those talks played out for months before Thursday’s announcement.
Karen Johnson of the city’s real estate department said the city’s due diligence revealed that a past would-be buyer installed sprinklers and did asbestos abatement at the more than 70-year-old building.
Bibler said Hamm is ready to accommodate the city’s plans. She said the proposed lease calls for the landlord to initially pay for property improvements and receive reimbursements from the city. She said the city favors this process because it will allow it to move forward more quickly.
“There’s a good partnership here with the landlord so that we can be good partners and act as expeditiously as we can,” Bibler said.
First, the City Council will need to sign off on Gloria’s shelter plan.
Gloria’s team is set to present its proposal to the City Council’s land use committee on April 18, days after Gloria must release his proposed budget for the fiscal year that begins in July.
The parks department says they spend $30M to run all the parks and trails. Todd Gloria is going to spend $30 million this year on this one homeless shelter, and as a bonus you can have 1,000 homeless. Congrats
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Some comments both positive and negative:
*1,000 beds is the size of shelter we need if we are to make a dent in our homeless problem.
*I see the city finally admitted they were lying when they said they had the beds to accommodate the people who are moved off their camping site.
* From the UT article on the shelter yesterday
“This shelter would operate similarly to others. . .” – Sarah Jarman, director of homelessness strategies and solutions.”
Other shelters send their people out in the morning and do not allow them to return until evening. When you have 100 – 150 people, that is no big deal. When you are going to move 1,000 people out every day it is another matter entirely. While the proposed shelter is in an industrial area, neighborhoods are only a couple of blocks away. Let’s do some planning around this, so that it does not blow up in their face. We want this shelter to succeed.
*Is Mr. Hamm a campaign donor for either Mayor Gloria or Councilmember Whitburn? Is this another sweetheart deal?
*I would like to see how the city is going to handle their Homeless sweeps when this shelter comes on line. What are they going to do when they offer a shelter bed, it is really available, and the person says “No?” What will they do when they offer a shelter bed, it is really available, and the person says “Yes?” You know they are going to want to take their stuff, their pet, their partner.
*Is this going to be a high bar shelter or low bar shelter? In other words do they have to be sober to get in? What if they are on the “No Admittance List?”
*We have over a year before this will be ready, let’s do some planning, get others involved, and do it right this time.
They’re going to do drugs and listen to music outside and never go anywhere because they are lazy and have no value. Source: the shelter on First Street.
Imagine a world where the government buys buildings to turn them into schools or amenities for residents.
Will the City actually do a better job on this real estate deal than in the past? Knowing the City’s history, it’s likely that it hasn’t yet had a thorough inspection or feasibility use study of the property. My first thought is that as it was designed for industrial use (i.e. not insulated), and with the proximity of Lindberg Field, the building will be noisy, not a good place for sleeping. It’s also unlikely to have good climate control. Safety measures for young children are undoubtedly not in place, etc.
And given the City’s history, it will probably write a contract that leaves taxpayers on the hook for 35 years even if the building is deemed unusable for whatever reason (like a natural disaster).
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$30 million a year operational cost while paying $1.9M a year for 35 years ($66.5M) for a building in escrow for $13.25M. And where do they wander around throughout the day? Todd meanwhile will be long gone. Has Hamm done the political contribution route too for this ROI?
I don’t want Todd Gloria going anywhere near a real estate deal. He just doesn’t have a clue.
A plan to warehouse the homeless?
$30 million/annually divided by 1000 homeless = Give the homeless $30,000 yr. for a year and forget the warehouse (i.e. they have a year to get their lives back together).
Suggest giving the money to organizations working with the homeless for years. It will have better outcomes and waste less money.
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in addition to all the other comments on why this isn’t a good idea let me add that it simply is NOT the best use of the structure. it isn’t just “a warehouse,” the building has offices, too.
and the location: it’s not just “near downtown.” wedged in between I-5 and the railroad tracks with Pacific Highway just beyond, this is NOT a place to house people.
no, no, no… PLEASE NO.
People are complaining about the shelter because it’s in a white community and not a brown community like the previous 20 times.
Time for San Diego elites to get their fair share like the rest of us. 🙂