Los Angeles could buy a 294-room hotel for homeless residents.
L.A. Mayor Karen Bass and the city’s office on homelessness are looking to buy the 103-year-old Mayfair Hotel at 1256 West 7th Street in Westlake, the Los Angeles Times reported.
In a memo sent to the City Council’s budget committee, Bass and her homelessness team said they want to acquire the 15-story hotel as part of her “Inside Safe” program.
The Mayfair, which served two years as interim homeless housing before closing last summer, was listed in September for nearly $70 million, as reported by The Real Deal.
If sold at that price, the sale of the 160,000-square-foot building would work out to $438 per square foot, or $238,100 per hotel key.
Bass and her team declined to say how much the city offered, saying the price would be revealed when the deal goes before the city’s municipal facilities committee next month.
They said the hotel would serve in the city’s fight against homelessness by cutting the leasing costs for Inside Safe, which has moved 1,200 people off the street and into hotels, motels and other housing.
If the city closes the deal, the Mayfair would become city-owned “permanent interim housing,” where homeless people can live up to a year before landing their own apartments.
Under the proposal, the city would provide substance abuse counselors, mental health clinicians and public health workers on the Mayfair’s ground floor, Bass said.
“There’s no shortcut to do this. You can warehouse people in a shelter if you want, and they’ll stay there for a couple of days and they’ll be right back out on the street,” Bass told the Times. “We have to think outside of the box, and maybe a little bit outside of the boundaries of what the city is normally doing.”
Bass’ homelessness team confirmed that the city signed a nonbinding letter of intent with Mayfair Lofts, the hotel’s owner, three weeks ago. That company is affiliated with ICO Group of Companies, based in West L.A.
The Renaissance Revival building, built in 1926, was purported to be a former home of Raymond Chandler. ICO completed a $37 million renovation in 2019, according to Loopnet.
In April of last year, ICO scored a $39 million refinancing package from Bank Hapoalim in Israel, according to public records.
In 2020, it became one of several hotels across the city to participate in Project Roomkey, a federally funded program that moved homeless Angelenos off the streets during the pandemic. When the contract with the city expired last August, ICO kept the hotel closed.
The mayor’s proposed homelessness budget for the coming year lists four separate line items for the acquisition of interim housing, which add up to $73 million. Bass’ team declined to say whether all or a portion of those funds would go toward the Mayfair purchase.
Those funds are not included in the $250 million being requested for Inside Safe.
— Dana Bartholomew
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