Once hailed as a fast-track solution to California’s homelessness crisis, Project Homekey now looks like a billion-dollar boondoggle littered with empty buildings and broken promises.
In Los Angeles County, shuttered motels meant to house the unhoused stand lifeless—fenced-off, vacant, and increasingly resembling abandoned movie sets rather than havens for the vulnerable, according to Westside Current.
Meanwhile, a stone’s throw away, other properties funded by Homekey have become de facto homeless encampments, complete with tents and makeshift fire pits. Out of 2,157 rooms the county bought with $550 million, a staggering 71% sit empty. The city’s record is only slightly better, with 44% of its 1,237 units still unoccupied despite spending $820 million.
The problem? Bureaucratic delays, ballooning costs, and questionable deals—like a luxury Mid-City apartment building the city bought for $36.5 million despite contractor liens, or a facility flipped for twice the price just days after a private buyer snagged it.
Westside Current writes that even sites that briefly housed residents often remain empty after relocation. “Construction takes time,” county officials say—yet the clock’s been ticking since 2020. Meanwhile, shelters that do operate are often overshadowed by the gaping emptiness elsewhere.
Analysts initially praised the plan. But as empty rooms pile up, so do costs—interim housing placements, security contracts, staff salaries, and millions spent just to keep these “investments” from decaying.
Worse, the program has seen scandal: One developer and its nonprofit partner face foreclosure, lawsuits, and fraud allegations. Lawsuits allege that over $114 million in funds vanished, with the California Attorney General and federal prosecutors now circling.
While Governor Newsom touts Homekey as a model solution, even he’s ordered new accountability measures.
On the ground, though, the gap between promises and reality is painfully clear: thousands of homeless remain, while motels meant to house them are as empty as ever.