November 18, 2012

Thomas Building Purchase, an Example of Throwing Money at a Problem

Development,Housing — @ 4:39 pm

Opponents of the County’s decision to purchase the Thomas Building in the Courthouse section of Arlington, have been portrayed as nimbies or worse—classists who spurn the presence of homeless people in their midst. It’s true that the immediate vicinity of 2020 14th Street is a well-to-do neighborhood. Luxury apartments and condos like the Palatine, Meridian, Woodbury Heights and the Odyssey surround the acquisition, making the placement of a homeless center there incongruous from a purely financial standpoint. If the real estate in this part of the county is valuable enough to warrant rents starting at $2,000 a month, then why is the County forcing the owner to sell? Why isn’t it encouraging the owner to redevelop the property in line with the rest of the neighborhood?

No one questions the need for a year round homeless shelter. In fact the Arlington Green Party has been lobbying for years to get one. But at what cost? The price tag is estimated at $42.6 million, about $10 million of which represents the cost of retrofitting the facility to house the homeless. This doesn’t include the annual operating costs: $1.5 million for debt service; $1 million for maintenance; and $.5 million to operate the homeless shelter.

In August, the Salvation Army announced a drive to raise money to add a $5 million homeless shelter wing to its facility in Cambridge, MA. If the Salvation Army can construct a homeless shelter in one of the most expensive real estate markets in the U.S. for $5 million, why must county residents pay twice that amount to house the homeless?

Put another way, investing $10 million to house 50 people amounts to $200,000 per person or $200,000 per key in hotel construction lingo. This is more than three times the $64,000 per key cost of constructing a room in an economy motel, according to the 2009 Hotel Development Cost Survey, by Elaine Sahlins.

Wouldn’t it make more sense for the County to buy or build a motel and house the homeless there rather than pay $10 million to retrofit a building that wasn’t designed for residential use in the first place? Compassion is not measured in dollars spent. It’s measured in dollars spent wisely. If the County were truly compassionate, it would reduce the average tax and fee burden imposed on county residents and increase the number of homeless served by locating a reasonably priced shelter in an existing facility designed for residential use.

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