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The Real Deal Los Angeles

LA’s latest answer to homeless crisis: Privately-funded housing

Consortium of partners have proposed creating modular home developments in South LA, with investors willing to accept a modest return
July 20, 2018 09:30AM

A rendering of the project on Colden Street (Credit: FlyawayHomes)

A small development to house the homeless will open in South Los Angeles this fall, but unlike other shelters in the city.

The nine-unit project is an experiment to create housing for chronically homeless people by bringing in for-profit developers and investors with no public funding.

The consortium of partners behind the project expect to deliver a 5 percent annual return to 56 stakeholders and hopes to replicate the model to create thousands of units of housing for L.A.’s homeless population, according to the Los Angeles Times.

The $3.6 million project at 820 W. Colden Avenue is built out of shipping containers. It will function much like the permanent supportive housing funded with $1.2 billion in city bonds that was approved in 2016 via Proposition HHH, but with no public subsidies.

The partners include members of the People Concern nonprofit and Steaven Jones Development Company, formed Flyaway Homes to develop the projects. They believe they can cut costs and development time and build the same type of housing funded via HHH. By building without public funding, they can bypass the city requirements, which include lengthy approvals and paying prevailing wages.

HHH projects usually take more than three years to build and cost an average of $450,000 per unit. Flyaway says it can build at a cost of $400,000 per unit and shave off construction time by using modular units.

The city has developed numerous plans to house L.A.’s 25,000 homeless residents. That includes building transitional shelters around the city, which are proving to be unpopular with residents. The city is also considering housing people in hotels and motels, a page ripped from New York City’s book.  [LAT] — Dennis Lynch