Homelessness in many cities across the U.S. is reaching crisis proportions, and it’s getting worse because of housing shortages and sky-high costs. But in Los Angeles, a new project, based on the concept of social impact equity, hopes to curb the growing problem of homelessness.
CGTN’s May Lee reports.
Construction at a unique housing project in the heart of Los Angeles is almost done. The three-story structure is made up of eight recycled shipping containers from China, and when finished, it will permanently house 32 homeless people.
But there’s one thing that sets this project apart from all other homeless housing initiatives. There is no taxpayer money being used.
This is a for profit business model so 56 private investors are helping to build this facility, and they expect to get about a five percent return on investment annually.
The mastermind behind this three-and-a-half million-dollar social impact equity project is private developer Fly Away Homes.
FlyAwayHomes Chairman Steaven K. Jones/Chairman of FlyAwayHomes says, “When we gave them the profit motive of getting a four to five percent return on investment they felt that was a beautiful combination of meeting their needs of social impact and at the same time getting a fair return on their investment.”
Because FlyAwayHomes is a private enterprise, cumbersome and expensive government regulations are bypassed, which helps lower cost and dramatically shorten construction time.
For example, according to city data, government housing rules require one unit per person, which costs approximately $400,000.
FlyAwayHomes with the help of social services agency, The People Concern, will place four people per unit at a cost of $100-thousand per head.
“In working with The People Concern, they told us the most important thing was privacy that each person needed their own bedroom”, says FlyAwayHomes President Lawry Meister, “so we have four bedrooms here. Each one is about eight by 10.”
Each unit also has a living room, dining room, bathroom and kitchen. There’s usable outdoor space as well including a garden area.
The People Concern will master lease the complex from FlyAwayHomes, find qualified tenants who will pay a modest rent using housing vouchers and disability benefits, and provide services such as therapy and counseling.
CEO John Maceri says this is a good alternative solution to solving homelessness in LA, which exceeds 53,000 people, but he’s direct about what more needs to be done.
“I don’t know anybody working on the ground who gets up in the morning scratching their head saying “Gee, we don’t know what to do.” says Maceri. “We know exactly what to do. If we could get the resources and folks would get out of the way and let us get about the business of housing people, we would be making significant progress.”
For Felix Garcia, who was homeless for 12 years and now works with The People Concern, taking action isn’t about IF, but When.
“One of the things I can share for sure is for people to jump on the bandwagon, volunteer, donate and get busy with us.” says Garcia.
And for FlyAwayHomes, that means setting a goal to build 20 projects a year in LA with the hope that other cities across the country will jump on their bandwagon.