Newport Beach pledges $3 million to permanent supportive housing project

Joining neighboring Costa Mesa and the Orange County Board of Supervisors, Newport Beach last week pledged $3 million for the conversion of a Travelodge motel property in Costa Mesa into permanent supportive housing.

City staff said the city was asked to participate in the project’s funding, which was proposed by American Family Housing, by Costa Mesa city officials. Construction is slated to begin in late 2024.

The work will convert the 3.5-acre parcel at 1400 Bristol Street that currently has 120 motel rooms into 76 studio and one-bedroom apartments for extremely low-income residents, with two-bedroom units for on-site service providers.

The estimated total cost of the development is $45 million. Costa Mesa pledged $4 million, and the county agreed to acquire and rehabilitate the hotel with a $6-million loan.

The bulk of the funding comes from the state’s Project Homekey funds with roughly $27 million allotted to the project, with the rest from county and city contributions along with a private loan expected to be around $3 million.

Newport Beach officials unanimously approved the $3 million contribution on a 55-year term at an interest of 3%. City staff said they are also asking that 12 units would be permanently set aside for people relocated from Newport.

“One of the bottlenecks [of homelessness] is the next step after the shelter, the reason our shelter is full and that we need more beds is because we haven’t been able to connect properly with the next step of getting people out of the shelter and into permanent supportive housing,” Councilwoman Robyn Grant said.

But Grant, who is on an ad hoc committee on homelessness in the city with Mayor Noah Blom and Councilwoman Lauren Kleiman, said that one of the challenges with this is that the city does not have much “ownership” over how that transition happens and cautioned that staff ensured that there was “fluidity between the shelter to whatever extent it can happen and this permanent supportive housing.”

Kleiman agreed, noting that she was generally supportive of allocating the funds but wanted to make sure what the city would be getting would be clearly delineated.

“It’s really expensive, but that’s what every city’s faced with. It’s this expense. We’re just fortunate that we can ... afford to do that, certainly a loan. I think it’s incumbent upon us that this problem of people going into shelters and then having nowhere to go; it’s just the first step, 12 rooms, get people into a place where it’s permanent and they’re able to get some support,” said Councilman Brad Avery.

“That’s what every city should be doing. So, I think it’s really good that we’re stepping up in this way. It’s frustrating that it’s so incremental, and it’s so relatively small, but compared to a lot of cities, our homeless population isn’t that large, but certainly residents feel the impacts of it. I think this is another partnership, basically, from my standpoint and ... it’s great. It’s something that we should be doing. The solution is you can’t do it with shelters alone. You’ve got to have housing.”

By its own tally, the city reported about 41 homeless individuals in June.