A city-owned motel intended to house the homeless, empty since Denver bought it 18 months ago, could be sold this year.
The city began looking for a firm or organization to take ownership of the former Stay Inn at 12033 E. 38th Ave. in November.
The buyer would pay just $10, and be responsible for converting the four-story building into “supportive housing” for those who have been homeless, according to the city’s request for proposals, or RFP.
The arrangement, which the City Council will have to ultimately approve, is the latest step in what has become a long process to get people housed in the structure along Peoria Street just south of Interstate 70.
It was May 2021 when then-Mayor Michael Hancock and Congresswoman Diana DeGette held a press conference at the motel to announce the city would buy it. But the city didn’t actually take ownership until August 2023, some 27 months later. Denver paid $9 million for the 96-room building.
Since then, the motel has sat fenced off, even as the city — now led by Mayor Mike Johnston — has bought or leased other hotels around the city and quickly moved in those formerly living on the streets.
Derek Woodbury, spokesman for Denver Department of Housing Stability, said the decision to sell was made recently.
“We have explored various options for converting the property to supportive housing, and in the fall of 2024 we identified a possible ownership transfer as the best means for accomplishing this,” he said in an email.
The building was renovated by the previous owner to include kitchenettes and a new sprinkler system. But city officials said last year that the building needed more work before it could house people, saying “possible renovations include structural repairs to walkways and railings and electrical system repairs.”
Denver has not completed any renovations. Woodbury said the city has done only “minor repairs to protect the asset.” The RFP notes that the building would be sold as is, and that a buyer would need to pay for renovations.
The effort to select a firm to buy the motel is still active, and no firm has been selected, Woodbury said Thursday.
The property would be sold with a covenant requiring it operate as income-restricted housing for 99 years, according to the RFP. Supportive housing is intended for those up to 30 percent of the area median income, who are already homeless or facing homelessness.
City officials have previously said the building also needs to be rezoned in order to house people. Rezoning hearings were once scheduled for August and September but did not happen.
Woodbury said it will now be up to the new owner to rezone the property, although he said Denver “would support anyone awarded this through the rezoning process.”
For now, the only people who live on the property continue to occupy not the building, but rather a network of shed-like structures on its parking lot — one of three pallet shelter complexes the city has established for the homeless. The RFP specifies the micro-community will be on the property for four years and could be renewed for additional years.
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