Calling it a trailblazing project, Mayor Alan Webber and the City Council unanimously approved an agreement Wednesday to use $2 million in federal coronavirus relief funding to help finance the purchase of a hotel on South St. Francis Drive to house people affected by the pandemic.
Plans call for the 122-unit Santa Fe Suites to be converted into studio apartments for people housed in temporary shelter, as well as renters who have lost their jobs or whose incomes have been substantially reduced as a result of the economic downturn from the coronavirus pandemic.
“This is a major first step for us to take to end housing instability in Santa Fe,” Alexandra Ladd, director of the city’s Office of Affordable Housing, told the council. “It is definitely not the last step we need to take, but I just wanted to emphasize that this is a really important first step.”
Ladd and other officials also emphasized the hotel will not be a homeless shelter, though it will house people transitioning out of homelessness, and the city won’t own the property.
“This is where people can live for as long as they need to live and, importantly, stay safe during the pandemic,” Ladd said.
According to city documents, the property will be owned and operated by Community Solutions, a New York-based nonprofit that works to end homelessness. Ladd called the group a highly capable, respected and experienced partner.
“Community Solutions is playing the role of a co-developer and actually helping us to get the deal closed and manage the property during the conversion time into the permanent supportive housing model,” said Ladd, who also presented a slide showing that a local project sponsor will own the property, coordinate social services and manage the tenanting process.
Senior Assistant City Attorney Marcos Martinez said the $2 million in funding under the agreement between the city and Community Solutions is contingent on a closing before Dec. 30.
“That deadline is important because it is one of the eligibility requirements for reimbursement of CARES Act funding,” he said. “Community Solutions Group CSG will provide $6 million for the balance of the funds for the purchase of the property. In addition, the agreement requires that the property be put to use, so we have to have tenants — COVID-impacted occupants — prior to Dec. 30.”
Ladd said the sale price is $7 million, but the $8 million total is a result “of the due diligence and closing costs on top of that.”
“It’s possible that the sales price will be, depending on what the appraisal comes back at, maybe … reduced a little bit further,” she said.
City Councilor Michael Garcia, whose district includes the property, said he received a lot of “feedback and concerns from constituents” complaining the city didn’t inform them about the project.
“Some of the biggest concerns I’ve heard from constituents is that they have not been involved in the process, nor heard about it, nor were any of their concerns taken into consideration,” he said. “I understand that time is of the essence, but … why wasn’t there any planning or preparation to engage the community, inform the community, get community feedback on the matter?”
Ladd called it a “private transaction” and said the city’s involvement was to act as a pass-through entity to deploy emergency funds at its disposal.
“To be frank, it also serves our other interests, which is to permanently house some of the people that we are currently housing at midtown,” she said, referring to what used to be the campus of the College of Santa Fe and then the Santa Fe University of Art and Design.
“Without quick action, we will not have the availability of these funds,” Ladd added. “This is a really great example of a lot of different parts of our community coming together, both private investors and nonprofits, as well as conventional banks, so we’re trailblazing a little bit here but we are moving quickly and understand why people feel like it’s too quickly.”
If the project serves as a model to repeat in Santa Fe in the future, Garcia said the city should be “proactive and engage the community” going forward.
“We should show that we are good stewards of the community and say, ‘Look, this is what’s happening. This is how it might impact you. What are your concerns?’ ” he said. “I think that’s our duty as city government.”