King Edward Hotel to Become Affordable Housing

The King Edward Hotel was purchased for $15.25 million including the King Eddy Bar and parking lot space. The King Edward joins the Madison Hotel on Seventh Street, which was purchased for $8 million, and the Sunset 8 Motel for $4.6 million.

City and county leaders have spent ample time and resources responding to the worsening homelessness crisis, including persuading voters to approve measures that will create billions to build housing and provide services. Now, a new nonprofit entity is entering the fray, with a model it claims is speedier and more efficient.

Last week, the Healthy Housing Foundation, the housing arm of the AIDS Healthcare Foundation, announced that it has purchased the King Edward Hotel, and plans to turn the property at 121 E. Fifth St. into inexpensive housing for homeless individuals. The move follows the organization’s acquisition of a nearby building, the 94-year-old Madison Hotel in Skid Row.

At a press conference on Monday, April 30, in the lobby of the King Edward Hotel, AHF President Michael Weinstein announced the purchase of the 112-year-old building, which is mostly empty. He said efforts to begin housing chronically homeless individuals will start immediately.

Weinstein said his model is a cheaper and quicker way to address homelessness than building permanent supportive housing. Those projects, which pair apartments with in-building services such as mental health counseling and job training, cost an average of $434,000 per unit when using Proposition HHH funds, according to the Prop. HHH Development Financial Report.

“We’re trying to show that not only are we responding to the crisis and getting a roof over peoples’ head, but also we’re trying to tell government that there is a faster and better way to do it,” Weinstein said.

The King Edward was purchased for $10.6 million, and HHF spent another $4.7 million for the King Eddy Bar, which is on the building’s ground floor, and an adjoining cafe and parking lot. The purchase works out to around $70,000 per unit for the building’s 150 apartments.

Weinstein said Proposition HHH, a $1.2 billion property tax bond approved by voters in 2016, should be applauded, but that the creation of housing can be accelerated, something he said can be achieved by activating underutilized locations.

The King Edward is the third location that AHF has acquired, joining the 220-room Madison Hotel at 423 E. Seventh St. and the former Sunset 8 Motel, a 27-room establishment now called the Sunrise on Sunset in Hollywood. In total, the HHF has 397 rooms under its umbrella, with the goal to have every residence occupied by mid-summer.

The King Edward opened in 1906 and was designed by John Parkinson, who also worked on City Hall and Union Station. It began life as a luxury hotel in what was once the heart of Downtown. The hotel played host to dignitaries including Winston Churchill, President Theodore Roosevelt and the world’s first film heartthrob, Rudolph Valentino.

Weinstein said the hotel will be completely refurbished, at a cost of approximately $3,000-$5,000 per unit. Work will include new painting and flooring. Rents will be around $400 per month for the apartments. Most units have bathrooms, though there are no kitchens.

The rates are similar at the Madison, which also was mostly empty when HHF acquired it in February. HHF paid $8 million for that property and opened the location for tenants on Valentine’s Day.

Weinstein said that a priority will be housing individuals with chronic health issues. HHF will find tenants though its own resources and with referrals from various organizations in the community.

“We have hundreds and hundreds of homeless patients coming to our healthcare center, not only here but other places in the country as well,” Weinstein said. “I think it’s a very logical ascension of our mission.”

Currently, the King Edward has approximately 35 residents. Ged Kenslea, an AHF spokesman, said existing tenants will likely be relocated to another room in the hotel while renovations are underway, and will be able to stay in the building after the work is done.

Weinstein said his group has a goal of creating 10,000 units of housing in five years, which is the same number of permanent supportive housing residences that Prop HHH seeks to create over a decade. Weinstein said he is looking at properties across Los Angeles, including some in Downtown, though he would not identify specific locations.

Work Starts on Skid Row Affordable Housing Project

The creation of housing is a new turn for Weinstein. Since its founding in 1987, Weinstein has powered the AIDS Healthcare Foundation into a significant force in the fight against HIV transmissions. Initiated in Los Angeles, the AMF has since expanded worldwide, opening hospice locations and medical treatment and research facilities in some of the hardest-hit communities across the globe.

Weinstein has also moved into public policy, and was the chief proponent behind Measure S, which sought to place a moratorium on developments in Los Angeles that would have required alterations to city code. The controversial ballot measure sparked fierce opposition from elected officials and others, and was overwhelmingly defeated at the polls in 2017.Weinstein still remains active politically, however. Last week he filed petitions with more than 500,000 signatures to place a rent control measure on the statewide ballot in 2019. It would repeal the Costa-Hawkins Rental Housing Act, which when passed in 1995 enacted a statewide ban on rent control measures on buildings constructed after that year.

Article Date: 
Monday, April 30, 2018