The full accounting of what it cost the city of San Francisco to provide emergency shelter in the form of hotel rooms to homeless individuals during the height of the pandemic is still likely many months away. But now there's the question of what actual damage was done inside these hotels, and how much the city should pony up for it.
The assessments of actual damage inside hotels like the Hotel Union Square and the Tilden Hotel, which have filed millions of dollars in damage claims following the end of their use as shelter-in-place (SIP) hotels, is still somewhat opaque. But the Chronicle now reports that while there may be damage suits pending from four hotels and counting, a city agency has already recommended a payout north of $5 million to settle just one of them.
We learned in May that multiple hotel owners were coming after the city for damages caused by individuals who lived in their rooms for months between 2020 and 2021 — and this was hardly surprising.
As Supervisor Aaron Peskin puts it in an (under)statement to the Chronicle, "When we rapidly housed 3700 people, we were aware that some of them would be tough customers."
Peskin is less than trusting, though, of what hotels are claiming in terms of damages. He tells the Chronicle the city will pay for "whatever real damage has been caused, at its actual cost," but he adds, "if they think they’re going to fleece San Francisco... we’ll litigate."
It remains to be seen what litigation will come out of a $5.6 million damage claim by owner of the Hotel Union Square (114 Powell Street). The city initially offered them $400,000 for damage repairs, but, fast-forward to this month, and the Chronicle reports that "members of the city’s Government Audit and Oversight Committee met in closed session to consider a recommendation from the city’s Human Services Agency to settle the claim for some $5.3 million."
Multiply that settlement by at least four, with the Tilden Hotel (345 Taylor Street), The Good Hotel (112 7th Street), Hotel Vertigo (940 Sutter Street) also having made similar claims — the Tilden's was $6.5 million, and we don't know what the Chicago-based owner of the latter two is seeking — and the city is looking at a bill north of $20 million. The Chronicle is pegging it at least $10 million — however the real number seems likely to be far higher, with 25 hotels participating and, as the paper notes, "some SIP hotels only recently began winding down operations." (The Tilden Hotel remains closed to the public, but the other three have reopened for regular hotel guests, so presumably most damages have been fixed?)
This would be in addition to the over $200 million already spent on SIP hotels — though San Francisco was reimbursed for much of these costs by FEMA and state funding.
The SIP hotel-housing program hasn't fully ended. It was extended to September 2022, last we'd heard, as the city struggled last year to re-house vulnerable individuals in permanent supportive housing. And as the Chronicle reports today, there are still 297 people in SIP hotel rooms being paid for by the city, in undisclosed hotel properties. The city was on the hook for at least $20 million to extend the program as of last fall, which was not covered by state and federal grants.
At the program's peak, the city was leasing 2,288 rooms across 25 hotel sites in 2020. The program was meant both to provide housing to homeless people — particularly the elderly and medically vulnerable — and to provide isolation space for first-responders, physicians, and others who were being exposed to COVID-19 at work and needed space to reside away from their families.
The city has said that 1,500 individuals have been permanently rehoused so far after being transitioned out of the program.
Emily Cohen, the spokesperson for the Department of Homelessness and Supportive Housing, tells the Chronicle that regardless of these damage costs still to be determined, "in terms of lives protected, homelessness ended, we still consider it a major success."
Previously: With Shelter-In-Place Hotel Program Winding Down, Some Hotels Are Suing the City for Damages