Nimitz Motel | 555 Lewelling – Purchase & Sale Agreement Extension City Council
2 555 Lewelling Blvd
555 Lewelling Blvd. is currently operated as the Nimitz Motel The building has 33 studio lodging units
Motel currently has ground floor office and restaurant.
Motel includes on-site parking and laundry facilities.
In addition to being near grocery stores and other amenities, the site is also close to local encampments.
Current
Use
3 February 2021 - City Council provided direction to find site(s) for short-term navigation center/shelter and permanent supportive housing
Fall 2021 - City found an interested seller at 555 Lewelling Blvd (Nimitz Motel) and formed a project team of City and nonprofit staff
March 2022 - Council approved a purchase & sale agreement ($6.15 mil sales price) with the seller
May 2022 - City submitted Homekey 2.0 application submission to the State, but was denied in Summer 2022.
Opportunity
in San
Leandro to
Address
Homelessness
4 October 2022 - Council approved a purchase and sale agreement extension until March of 2023
Staff has been actively working to address the issues flagged by the State for the rejected Homekey 2.0 application
Staff has recruited an expanded and experienced project team to apply for the next State funding round (Homekey 3.0)
Project team has been developing enhanced partnerships, project timeline and operating/development agreements
Sustaining
Momentum
5 City – Both Community Development (Housing) and Human Services remain actively to provide overall leadership and direction Andrew Hening – An experienced, outside project manager to support the application process. Andrew has worked on five previous Homekey projects in Marin and Sonoma counties.
Building Futures – Building Futures will continue to serve as the service provider for the navigation center/shelter.
Housing Consortium of the East Bay (HCEB) – HCEB will provide property management services for the navigation center/shelter.
Allied Housing – Allied will serve as the developer for both the navigation center/shelter, as well as the long-term permanent housing opportunity.
Our
Updated
Team
6 Proposal: Acquire motel and renovate into interim nav center/shelter for up to about 5 years. Long-term, the entire site would be demolished and redeveloped into a new, higher density permanent supportive housing development. The interim nav center/shelter would be moved to a new location within the 5 years.
Convert some of the existing motel rooms into office
spaces/meeting areas for services with remaining rooms (approx 29-30) converted into non-congregate shelter/housing units.
Project design is currently being re-assessed. An architect has been hired to refine the proposed project renovations and budget for Homekey 3.0 application.
Nimitz Motel/
Homekey
Development
Vision
7 1) Sales price remains at $6.15 million plus an estimated $85,000 in closing costs;
2) extension to July 1, 2023 with closing by August 30, 2023 and City to release $75,000 (non-refundable) from initial $184,500 escrow deposit to seller towards purchase price;
3) Extension Option 1 – if exercised, closing will extend to September 30, 2023 and City to deposit an additional $50,000 (non-refundable); and
4) Extension Option 2 – if exercised, closing will extend to October 30, 2023, but no additional deposit required.
City currently has approx $2.95 mil in local, State and federal housing/homeless targeted funds allocated for acquisition.
On February 22, Finance Committee recommended to City Council to allocate up to $3.2 million in FY22-23 surplus General Fund for gap funding for motel acquisition.
If awarded, Homekey may reimburse City for the gap funding.
Purchase &
Sale
Agreement
Extension
Terms
8 Tonight, staff recommends Council approve Amendment #5 to the PSA
Late March 2023 - Homekey 3.0 Request for Proposals (RFP) release
April 6, 2023 – staff expected to request Council approval of State mandated resolution to apply for Homekey 3.0. Project scope and budget will be presented.
Mid-late April 2023 – Submit Homekey 3.0 application to State Spring/Summer 2023 – City to consider allocating up to $3.2 million in one-time City surplus General Funds as acquisition gap funding to purchase the motel
Summer/Fall 2023 – State Homekey funding award announcement and motel acquisition completed
Spring/Early Summer 2024 – interim nav center/shelter to open if approved for Homekey funding. Motel needs to be operational within 8 to 12 months of grant award.
Next Steps
9