The owner of the former Stay Inn at 12033 E. 38th Ave. in Denver bought it with plans to reopen it as a Travelodge. (Eric Lutzens/The Denver Post)
In May 2021, Denver’s mayor and congresswoman stood outside a hotel south of Interstate 70 and announced the city would buy it to house the homeless.
A year-and-a-half later, Denver still doesn’t own the former Stay Inn at 12033 E. 38th Ave., but that is expected to change in the coming months.
The proposed $9 million purchase, which also includes two adjacent undeveloped parcels along Peoria Street, went before a City Council committee on Tuesday, and will be voted on by the full council in the coming weeks.
Assuming it passes as expected, the deal will close in the first quarter of 2023, according to Lisa Lumley, the city’s director of real estate.
Councilman Chris Herndon, who represents the area, declared the purchase “a long time coming.”
“I had almost monthly conversations with (Denver Chief Housing Officer) Britta (Fisher), wondering if this building was going to happen, and I was very happy the last conversation when she said we got it,” Herndon said at the meeting.
The city plans to make the purchase with federal funds, including a $2 million grant from the U.S. Department of Housing and Urban Development. Congress had not even approved the HUD spending when the press conference featuring Mayor Michael Hancock and Congresswoman Diana DeGette was held in May 2021.
Denver originally planned to operate the hotel, which has 95 rooms and a manager’s unit, as a homeless shelter for the first two years before converting it into “supportive housing.” But the city now expects to jump right to the supportive housing use, a city official said Tuesday.
And the price tag has increased from the original $7.8 million.
The hotel is owned by Englewood-based Situs Group, which bought it and two adjacent undeveloped parcels along Peoria Street for a combined $4.3 million in November 2019, records show.
Situs President Hugo Weinberger told BusinessDen Wednesday that the increase in the price reflects the “substantial monthly costs” that he’s had over the past year-and-a-half, when the prospect of the deal closing at times seemed questionable.
“It’s really just commensurate to the funds we invested,” he said.
Weinberger said he and his investors bought the building with the idea of reopening it as a Travelodge by Wyndham. But then the arrival of the pandemic derailed the planned opening date, and a windstorm caused significant damage, necessitating repairs and keeping the building shuttered. Along the way, the city reached out about potentially buying it.
Weinberger noted that he’s made a number of upgrades to the building, including installing a sprinkler system and adding kitchenettes to nearly all rooms at the city’s request.
The city plans to hire a contractor to operate the facility. That contractor, who has yet to be chosen, will need to provide help for residents suffering from mental illness or recovering from homelessness, and work to connect individuals to other community support services. The contractor will be responsible for turning the hotel’s pool area into a community space.
The owner of the former Stay Inn at 12033 E. 38th Ave. in Denver bought it with plans to reopen it as a Travelodge. (Eric Lutzens/The Denver Post)
In May 2021, Denver’s mayor and congresswoman stood outside a hotel south of Interstate 70 and announced the city would buy it to house the homeless.
A year-and-a-half later, Denver still doesn’t own the former Stay Inn at 12033 E. 38th Ave., but that is expected to change in the coming months.
The proposed $9 million purchase, which also includes two adjacent undeveloped parcels along Peoria Street, went before a City Council committee on Tuesday, and will be voted on by the full council in the coming weeks.
Assuming it passes as expected, the deal will close in the first quarter of 2023, according to Lisa Lumley, the city’s director of real estate.
Councilman Chris Herndon, who represents the area, declared the purchase “a long time coming.”
“I had almost monthly conversations with (Denver Chief Housing Officer) Britta (Fisher), wondering if this building was going to happen, and I was very happy the last conversation when she said we got it,” Herndon said at the meeting.
The city plans to make the purchase with federal funds, including a $2 million grant from the U.S. Department of Housing and Urban Development. Congress had not even approved the HUD spending when the press conference featuring Mayor Michael Hancock and Congresswoman Diana DeGette was held in May 2021.
Denver originally planned to operate the hotel, which has 95 rooms and a manager’s unit, as a homeless shelter for the first two years before converting it into “supportive housing.” But the city now expects to jump right to the supportive housing use, a city official said Tuesday.
And the price tag has increased from the original $7.8 million.
The hotel is owned by Englewood-based Situs Group, which bought it and two adjacent undeveloped parcels along Peoria Street for a combined $4.3 million in November 2019, records show.
Situs President Hugo Weinberger told BusinessDen Wednesday that the increase in the price reflects the “substantial monthly costs” that he’s had over the past year-and-a-half, when the prospect of the deal closing at times seemed questionable.
“It’s really just commensurate to the funds we invested,” he said.
Weinberger said he and his investors bought the building with the idea of reopening it as a Travelodge by Wyndham. But then the arrival of the pandemic derailed the planned opening date, and a windstorm caused significant damage, necessitating repairs and keeping the building shuttered. Along the way, the city reached out about potentially buying it.
Weinberger noted that he’s made a number of upgrades to the building, including installing a sprinkler system and adding kitchenettes to nearly all rooms at the city’s request.
The city plans to hire a contractor to operate the facility. That contractor, who has yet to be chosen, will need to provide help for residents suffering from mental illness or recovering from homelessness, and work to connect individuals to other community support services. The contractor will be responsible for turning the hotel’s pool area into a community space.
