With the help of a state grant, San Francisco may purchase a large single-room-occupancy hotel building that for years has been a senior-housing complex.

The Granada Hotel at Sutter and Hyde Streets has been a home for "active" senior citizens for over 100 years, and some residents were scared of being displaced last year when a new owner took possession of the 232-unit building. That scare, as the Examiner reports this week, prompted Supervisor Aaron Peskin to explore a possible acquisition, and now the city has received preliminary word that it's been approved for a grant from California’s $600 million HomeKey program — which provides funds to buy and rehabilitate housing.

The grant comes with stipulations about local matching from a city, and it's being sought by Episcopal Community Services, which will be the owner and operator of the resulting supportive housing facility. And all of the seniors living there now will be guaranteed a home to remain in.

Peskin tells the Examiner that there were only 20 applications for HomeKey grants in the Bay Area, and this project, along with others in Santa Clara and Alameda counties, will share a potential $100 million pot. The Granada Hotel may see up to $45 million of that, with the city ponying up $23 million over five years for ongoing maintenance and operations.

"That hard work and investment on the front end has paid off in this application today — we were ready," Peskin says.

The remaining unoccupied units in the building will help San Francisco reach its goal of adding 1,500 new supportive housing units to its current total of around 8,000 — creating a key stepping stone for people trying to exit homelessness.

It was clear five years ago that the building wasn't fully occupied — SFist featured a Craigslist ad posted by the building's management in the Apartment Sadness column because it was offering SRO units at market rate to younger tenants, in what was ostensibly an old-folks' home. At the time the building had a certificate recognizing that it had been serving active seniors in SF for 108 years.

In a statement this week about the first-in-the-nation Homekey grants, Governor Gavin Newsom said, "We are realizing our dream of helping local jurisdictions acquire thousands of motel rooms and convert them into housing for individuals and families experiencing homelessness."

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