May 15, 2024 - Politics

Mayor Gloria's megashelter negotiations plod along

Proposed site of a new 1,000-bed shelter in Middletown

The site of the proposed homeless shelter in Middletown near the airport. Photo: Andy Keatts/Axios

Mayor Todd Gloria says his plan to open a 1,000-bed homeless shelter at a Middletown warehouse is on track, but that track is beginning to look pretty circuitous.

Why it matters: The shelter would become the largest in the city, but the cost of the long-term lease Gloria negotiated with the property's owner has been criticized by city officials and real estate professionals.

State of play: The City Council had its second closed-session hearing on the proposal Monday, after the first one led to new negotiations with Douglas Hamm, the property's owner.

  • Voice of San Diego reported Tuesday that the renegotiated deal got a cool reception from the City Council, and directed staff to continue discussions.
  • A council committee was set to discuss the lease in April, but that was canceled after the city's independent budget analyst signaled "significant questions."
  • The council has since had two closed session meetings, and the committee chair Kent Lee told Voice he has no plans to reschedule.

By the numbers: Consultants working with Hamm told NBC 7 he agreed to lower the price per square foot and length of the lease, and to cover more of the cost of improvements to turn the warehouse into shelter.

  • Voice reported Hamm is putting up $3.5 million of the $18 million in needed improvements, lowering the price per square foot from $2.45 to to $2.15 and trimming the deal from 35 years to 30.
  • Yes, but: The new deal also changed the annual increase in rent from 3% to 4%, in exchange for those other changes.

The bottom line: After this week's council hearing, Gloria said in a news release he wasn't giving up on the project — but it's not clear where the proposal goes from here.

  • "Negotiations surrounding such a large and ambitious proposal are complex," he said. "This cannot be accomplished overnight, but we are on track and I am fully committed to getting this done."

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