A hotel identified as a promising location for transitional housing remains empty nearly a year after city leaders expressed interest in buying it.
The former Stay Inn, located just off I-70 in northeast Denver, is one of several local housing projects that Rep. Diana DeGette has singled out for federal funding. Last May, DeGette held a press conference with city leaders announcing their partnership. She requested $2 million to go toward the hotel's purchase as part of an appropriations bill the House passed in July 2021.
But the bill still hasn't received full congressional approval, leaving DeGette's and the city's plans up in the air.
"Unfortunately that legislation has not yet been taken up in the Senate," said Ryan Brown, a spokesman for DeGette, in an email.
After months of negotiations, Congress has still not reached an agreement on a final spending package for the 2022 fiscal year. The current stop-gap spending measure lasts through March 11.
"Rep. DeGette is working closely with House leaders to get the funding needed for the hotel project and others included in the upcoming spending bill that the House is expected to take up in the coming weeks," Brown said.
While the federal budgeting process plays out, the city is stuck in a holding pattern. It lacks the funds to buy the hotel outright, said Britta Fisher, Denver's chief housing officer.
"We have been in an extended period of due diligence working on the property overall," Fisher said, explaining that the city has been treating it like an impending real estate purchase, conducting inspections and the like. "We don't control it or own it at this time."
The city expects the total project to cost about $7.8 million, which includes purchasing the building, renovating 95 rooms and hiring a contractor to run the operation. It has roughly $4.5 million set aside for the project already, leaving a gap of roughly $3 million, Fisher said.
If realized, the building would operate as a temporary homeless shelter for about two years. The city would eventually convert it to long-term supportive housing for more than 150 people.
That would significantly boost Denver's supportive housing stock at a time when the city is seeing its homeless population swell, said Mayor Michael Hancock during last year's press conference.
"There's an urgent need for this," Hancock said.
Denver has funded a handful of other hotel-to-housing projects over the years. The latest opened at a former Quality Inn in 2020.
The projects are seen as no-brainer solutions by planners because they avoid the long and costly process of building entire new housing projects.
"It's practically instant housing," Fisher said. "You've seen more and more cities purchasing hotels and doing affordable housing conversions. And in Denver we've had great success with this before."
It's unclear how likely it is that DeGette's funding request will get the green light from both the House and Senate. Lawmakers have hundreds of project proposals on the table to consider thanks to the return of earmarks after a 10-year hiatus.
Other than the Stay Inn Hotel project, DeGette's requests include $3 million for a new homeless youth shelter and $2 million for a new health care services center for people experiencing homelessness envisioned by the Colorado Coalition for the Homeless.
The coalition's plans have been derailed due to the delay. The organization built its entire budget for its new health center project around the hope that it would receive federal funding, said Cathy Alderman, the coalition's communications officer, in an email.
"With this delay in funding decisions within Congress, we are scrambling to either find another funding source or consider delaying opening the site," Alderman said. "We are appreciative of Congresswoman DeGette's continued support and efforts and really hope that Congress can make some progress on getting these projects approved."
For now, the Stay Inn hotel in northeast Denver remains vacant and controlled by a private LLC. The company, IH Holdings 16, didn't return a request for comment.
On a recent afternoon, the parking lot sat empty except for a few boats on hitches and two cars in the parking lot. Some of the property was blocked off by a chain link fence.
Fisher said the city still hopes to turn it into affordable housing. Her team has started looking at alternative sources of funding in case the federal money doesn't come through.
"There's always going to be ideas that may or may not pan out," Fisher said. "But we're going to get everything done that we can with the resources that we have."
Editors note: This story has been updated to clarify terminology.
