The US has empty buildings it could use to tackle homelessness. Why is it selling them off?
The US does not have enough housing for unhoused people or for migrants. Yet each year the federal government, the nation’s largest single owner of real estate, identifies dozens of empty buildings it owns that can be made available to help with the problem. Few end up housing or helping those in need.
Why isn’t the government tapping into this reserve to help fix some of the most pressing social issues of our time?
Some of these empty federal properties are inappropriate, like an intercontinental ballistic missile silo in Wyoming, a calving shed in Washington state, or a one-time uranium manufacturer in New York.
Others are well-suited to be developed into housing and are located in cities with large unhoused populations.
Most of these, however, are sold to private companies, like a former Federal Reserve bank building with brasslined windows in downtown Seattle. A homeless non-profit applied to take it over and turn it into housing, but it went to a for-profit developer, and last year the building hosted a fake Banksy exhibition.
The program that oversees this process is known as Title V. Homeless providers say getting hold of Title V properties is fiendishly difficult. Doug Biggs, the director of a nonprofit that is trying to turn a former navy base in Alameda, California, into medical respite and supportive housing, says his organization has spent more than $1m so far on its application. The process has been “incredibly burdensome”, “almost impossible” and a “nightmare”, he said.
“Thank God I came into this without any hair,” Biggs half-joked.
Why is the program not working?
The program is meant to help solve homelessness by giving service providers a first right of refusal for vacant federal properties.
Biggs argued that his experience exemplifies the problems with Title V. He’s the executive director of the Alameda Point Collaborative, which is planning a nearly $100m project that will provide supportive housing for unhoused elders 55 years old and older with medical conditions, as well as a medical respite center for unhoused people in Alameda county. “You can’t get cancer treatment or dialysis if you don’t have a place to stay,” Biggs explained. “So we’ll provide that. We’ll also provide hospice.”
The upside to the property, near a state park and a place called Crab Cove – across the bay from San Francisco – is its stunning, trauma-informed location. “It’s right on the water,” he said. “You walk on the site and you just feel rejuvenated. It’s a once-in-a-lifetime chance.”
On top of local opposition, his collaborative has navigated a tricky relationship with the Title V program. The government approved the group’s application, but won’t award the property unless all the financing is in place. Potential funders, on the other hand, won’t give money until he has “site control” of the property.
Worse, the government is charging them $8,000 a month for the property, even though it has not fully transferred it. Biggs says his non-profit has spent more than $500,000 on the costs of applying, and “at least as much again on holding costs”, such as insurance, taxes, utilities and maintenance.
Biggs’s experience reflects what the heads of other large homeless service non-profits around the nation describe: they say Title V is an opaque and unresponsive bureaucracy with arcane rules, managed by an alphabet soup of federal agencies.
“The biggest issue is these decisions are very much the definition of arbitrary and capricious,” said Cathy Alderman, the chief communications and public policy officer at the Colorado Coalition for the Homeless. The group’s bid for a 600-unit affordable and supportive housing development in the Denver metro area was denied after an arduous, years-long battle and a 2019 federal court decision. “It just felt like a lot of roadblocks.”
Antonia Fasanelli, the executive director of the National Homelessness Law Center and among the nation’s top experts on the program, said she is trained to represent tenants and “used to finding a bogeyman”. With Title V, though, bureaucracy may be the bogeyman.
“I cannot understand why the federal government would not do everything in its power to find a way to make these programs work,” she said. “Title V regulatory policy remains outdated, inefficient and unnecessarily difficult to navigate.”
In a 2018 report, Fasanelli’s law center noted that “overburdened” and “underfunded” providers miss out largely due to governmental “failures” including the withholding of properties, insufficient outreach and inadequate technical assistance.
What the government says in its defense
Since Ronald Reagan first “reluctantly” signed Title V into law in 1987 as part of the McKinney-Vento Homeless Assistance Act, it has provided access to more than 500 buildings and 900 properties, Fasanelli’s law center found. Properties transferred through Title V have hosted services including food distribution, mental health treatment, case management and employment training.
Some properties can be given to local governments, as happened with a beachfront parcel in Oahu. It was conveyed to the state of Hawaii in 2021 and is being turned into homesteads for about 300 Native Hawaiian families.
Spokespersons at the three federal agencies responsible for Title V – the General Services Administration, the Department of Housing and Urban Development and the Department of Health and Human Services – declined to respond to questions on the problems raised by homelessness providers in this story.
Yet the government has signaled it is aware of them. Last spring, it proposed new regulations for the program, the first update since the agencies jointly published regulations in 1991. Fasanelli said the regulations don’t go far enough, and don’t fix the central problem: a disconnect with the most likely financing, which is tax credits for creating low-income housing.
Back when the law was first passed, Fasanelli said, “programs were using Title V to create what I would call the 1980s response to homelessness: soup kitchens, job-training programs. As time went on and the crisis continued, programs were saying: ‘We’ve got to create affordable housing.’”
These days, tax credits are “by far” the largest source of new construction funds for affordable housing, the Urban Institute noted. But states and local agencies are reluctant to grant them for Title V properties, advocates said, because they want an applicant to have full “site control” – while Title V administrators want all the financing ducks to be lined up first.
What ends up happening, the record shows, is that many properties that aren’t transferred to help unhoused people instead make money for developers, entrepreneurs and equity.
Who is benefiting?
There’s nothing illegal or unethical about a company or an individual buying a vacant federal building. Under a law passed in 2016, some “high value” assets are exempted from Title V precisely because they create substantial value for taxpayers when sold quickly. Others are sold through online auctions or negotiated sales.
Yet homelessness providers are frustrated that buildings that longstanding federal law says should be offered to them are instead mired in reams of red tape.
Then – ironically, they say – some are turned into luxury complexes that offer amenities like “sky bars”, movie theaters, art galleries and penthouses.
Alison Eisinger, the executive director of the Seattle/King County Coalition on Homelessness, which tried to buy the former Federal Reserve bank building in downtown Seattle, describes the rejection of its “robust” 2014 application as an “awful outcome”. King county is home to the third-largest population of unhoused people, in federal counts.
In Colorado, after Alderman’s coalition lost its bid for the Denver Federal Center, the 59-acre property was sold for $30m to Lincoln Property Co. The development stands to make its new owners “between $42 and $26 million in profit”, a real estate publication noted.
Some former Title V properties are intended to be particularly opulent. Between 2018 and 2022, Seychelles-based Global Ocean Investments bought the Ronald Reagan federal building in Harrisburg, Pennsylvania, the Bemidji federal building in Bemidji, Minnesota, and the veterans administration regional office in Columbia, South Carolina.
Global Ocean then announced highend plans which, in Pennsylvania, reportedly included a movie theater, a nail salon and an 8,000ft glass-enclosed rooftop bar with a steakhouse and a “luxury Italian restaurant”. Reported plans for the Minnesota and South Carolina properties also included rooftop bars.
Asked for comment, Charlotte Hawkes, a spokesperson for Global Ocean, referred inquiries back to the General Services Administration. “The buildings are only auctioned once all of the agencies have declined opportunity to receive the building, including for housing the homeless population in that area,” Hawkes wrote.
In the end, advocates say Title V’s promise is lost in a thicket of inscrutability. Meanwhile, there are steep costs to pay for the nation’s growing unhoused population. In 2017, the US Interagency Council on Homelessness found that homelessness costs taxpayers $50,000 per year, per person. In New York, overburdened migrant shelters are described as “horrific”.
In California, which is officially home to 171,000 unhoused people – but probably far more – some costs are harder to calculate.
“Every year I see people die on the streets in Alameda, and in the surrounding areas, who would qualify for this type of facility,” Biggs said. “And I get calls at least every other week from some hospital saying: ‘We have a homeless individual who needs your service, can we bring them over?’ And I say: ‘I’m sorry, it’s not been built yet.’”
The collaborative will finally break ground on its medical respite center by the end of this month; the senior housing building will have to wait until 2025. For Biggs, it’s all bittersweet. “The process itself is so complicated,” he said. “It shouldn’t be that way.”