The City of Los Angeles wants to use Project Homekey funds to buy an under-construction apartment complex.
The Housing Authority of the City of Los Angeles is set to pay developer Haroni Investments $49.5 million for the 128-unit apartment complex at 1654 Florence Avenue, according to Urbanize.
Project Homekey was devised by the state as a successor program to Project Roomkey, a pandemic-era program to rent out vacant hotels for people experiencing homelessness.
Project Roomkey is meant to buy hotels outright to convert into interim and permanent supportive housing.
An acquisition of the project on Florence Avenue in South Los Angeles appears to be the first time the city is buying a building other than a hotel through Project Roomkey.
The state receivedin federal funds to bankroll Project Homekey over the next two years. The state allocated around $358 million to L.A. County and municipalities in the county, all of which has to be spent by January 31, 2022, according to Urbanize.
If the deal with Haroni goes through at $49.5 million, the purchase would prove significantly cheaper on a per-room basis than what L.A. has spent building supportive housing from the ground up through.
The average cost per-unit of an HHH development is around $559,000, while L.A.’s purchase from Haroni would figure out to about $387,000 per unit.
Earlier this week, the L.A. Housing Departmentaround $30 million in Project Homekey funds to buy three hotels with 143 units between them, all of which would become interim supportive housing.
Altogether, L.A. has acquired 15 hotels with $120 million in Project Homekey funds and $60 million from other sources. They have 744 units between them.
In September, city officials projected they could buy between 500 and 1,000 hotel rooms through Project Homekey over the next two years.
Public officials estimated there are 40,000 homeless in the City of Los Angeles and about 65,000 countywide.
Haronifor the development in late 2018 and utilized Transit-Oriented Communities entitlements to boost the unit count.
The unit count was later knocked down from 136 to 128.
 — Dennis Lynch