WATSONVILLE—In January, the Santa Cruz County Board of Supervisors unanimously approved a plan for County staff to apply for a piece of state housing funds through a program known as Project Homekey.
That project, administered by the California Department of Housing and Community Development (HCD), is providing $1.4 billion statewide to develop existing facilities such as hotels, motels and multifamily apartments into supportive housing for homeless people, with onsite supportive services and case management.
The funding is intended for projects that can be developed and occupied as quickly as possible, typically within one year.
The application is asking for a total of $65 million for two projects: Rodeway Inn in Watsonville, which is located in a largely industrial area of the city at 1620 Beach St., and a vacant lot near Cabrillo College at 2838 Park Avenue in Soquel.
The facilities would serve tenants whose incomes are below 30% of the Area Median Income, and who have been referred by county officials.
Built in 1999, the 40,000-square-foot Rodeway Inn includes 94 units. The facility is now operated under Project Roomkey, which aimed to house the homeless populations during the Covid-19 pandemic.
The Rodeway project would be overseen by Los Angeles-based Shangri-La Development, Inc., which bills itself on its website as a real estate development company. Nobody from that organization responded to a request for comment by Tuesday evening.
The Soquel project would be developed by 2838 Park Ave, LLP, which is an affiliate of Novin Development.
The estimated acquisition and development cost for the site is $32 million, but county officials are asking for $39 million to cover possible overages.
The hotel’s double-queen, single-king and suite units would be converted to permanent units complete with kitchenettes. One unit would be dedicated to the property manager, while 23 would be for people with disabilities.
The 3,000-square-foot common area would be converted to a community area, a computer center and a space for supportive services.
If approved, the work will include structural upgrades, ADA compliance, filling the pool and adding convertible kitchenettes in each unit.
Watsonville Community Development Department Director Suzi Merriam says the project would be the first of its kind in Watsonville.
“Our hope with this program is that these permanent supportive housing units will come with a high level of onsite management and case management,” Merriam said. “We’re hopeful that this is one step in the right direction to help the homeless community.”
The Soquel project—estimated at $26 million—would consist of 35 permanent supportive housing units, and one manager’s unit. While Homekey funds would pay for the bulk, money would also come from revenue from housing vouchers.
A decision from the state on the funding is expected later this year.
