Denver bought hotel to house homeless but 15 months later it hasn't opened

Denver officials celebrated the purchase of a 96-unit hotel last year with much hype, envisioning a homeless shelter that would offer an array of "supportive" services such as case management and therapy.

The city described the former Stay Inn hotel as having recently undergone updates. Then-Mayor Michael Hancock said the city was proud to "transform" yet another hotel into a shelter for homeless people, and the Department of Housing Stability said it anticipated the site would begin housing the homeless by late 2023.

The hotel cost taxpayers $9 million. Roughly 15 months later, not a single homeless person has moved into the building.

When asked why, Mayor Mike Johnston's administration pointed to delays in renovations. A councilmember attributed it to zoning issues.

In order for the shelter to open, a contractor needs to be assigned to complete renovations, according to Derek Woodbury, a spokesperson for Denver’s Department of Housing Stability.

The department promised to do that “as soon as possible.”

Woodbury said the delay is "due in part to a change in direction with partner selection."

"HOST was previously in negotiations with a potential partner, but during the due diligence process, our staff determined that this organization wasn’t the best partner for this project," he said.

Woodbury didn't explain why the "potential partner" wasn't the best fit for the project.

In fact, it's not the first time that the project has faced delays.

Back in May 2021, U.S. Rep. Diana DeGette and Hancock first announced a plan to tap federal funding to buy the hotel at 12033 E. 38th Ave. Officials said then that the hotel would be ready as a homeless shelter by the end of that year.

At the time, DeGette requested $2 million in federal funding for the project.

Nearly a year later, the building sat empty. DeGette's office said that, unfortunately, Congress had yet to pass the bill containing her funding request.

When Congress finally approved the legislation in December of 2022, the congresswoman said it was a big deal for the community.

The city had considered buying the former Stay Inn for $7.8 million in 2021 but ultimately landed on $9 million as the purchase price in January 2023.

A four-story building, it has an an elevator, a lobby, and a community space. As envisioned, 89 of its 96 units would be converted to have micro-kitchens with mini-microwaves, coffee makers, mini-fridges, hotplates, food storage and sinks.

The hotel was already furnished, according to the purchase agreement from last year. Rooms were fitted with carpets, beds, microwaves, nightstands, dressers and televisions, the agreement said.

Woodbury said renovation costs remain unclear, but that they include structural repairs to walkways and railings as well as the electrical system.

"Both the former and current administrations have shared the vision for supportive housing at the Stay Inn site," Woodbury said.

"There is tremendous need for additional supportive housing units in Denver," he added. "This property lends itself as an ideal property for conversion to such housing opportunities for people exiting homelessness."

The hotel is surrounded by manufacturing facilities, gas stations and other hotels near Interstate 70.

The area is also the site of Johnston's "micro-community," where 54 mini shelter units serve as temporary shelters for homeless people. '

Meanwhile, District 8 Councilmember Shontel Lewis insisted that the problem with the hotel conversion is zoning.

"In order for this use to be realized, the property needs to be rezoned, which requires a lengthy and specific process," Lewis said, adding she "inherited the project as a new city councilwoman, under a new mayor who had different plans and solutions in place to address the national unsheltered homelessness crisis."

Today, the hotel's windows are boarded up.

A nearby wholesale business operator noted there has been increased security in the area.

Keith, a homeless man who was roaming around the area, told The Denver Gazette he arrived a week ago looking for a "tiny" home shelter.

Keith said he didn’t realize the "tiny shelters" in the "micro-community" are reserved for homeless people who lived at encampments that the city had swept.

He was holding a sign that said, "Needing money, please help.”

Keith didn't say where he was going next. But when asked what type of resources he is looking for, he replied, “What I need is a job.”