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Council approves We Hope operations grant and county subsidy for Arena Hotel interim housing
Summary
The City Council approved a grant and a three-year subsidy arrangement to stabilize operations at the Arena Hotel interim housing site and authorized We Hope to operate day-to-day services during a repositioning and redevelopment process.
The San Jose City Council approved a grant to We Hope and accepted a three-year subsidy-layering commitment by the Santa Clara County Housing Authority to stabilize operations at the Arena Hotel interim housing site.
Background and current operations: The Arena Hotel was acquired through the state's Homekey program and opened as an interim housing site. Housing Director Eric Sullivan said the property has presented operational challenges because of its downtown location, high visibility, and the limited staffing model originally funded through Homekey. "Given the current qualified development partner to bring forward a viable redevelopment plan for the site," Sullivan said, staff are pursuing both operational stabilization and a long-term redevelopment path.
Funding and operator change: The Housing Authority recently approved $2.1 million per year for three years to help subsidize operations at the site. The council approved a grant agreement with We Hope to assume day-to-day site management; We Hope currently operates the Berryessa safe-parking program and brings experience in interim housing operations and services. Deputy Director Cupid Alexander said We Hope will provide supportive services, property management, building maintenance and security during the repositioning period.
Redevelopment timeline and procurement: The city has a procurement underway to identify a developer for permanent redevelopment; staff told council they expect to secure a development partner and re-scope a financially feasible redevelopment plan within the subsidy-window, with the goal of a funding cycle submission in 2026 and eventual construction in a multiyear horizon.
Community concerns and transition plan: Councilmembers and neighbors asked for clear resident communications and a seamless handover from the current operator (Home First) to We Hope. Eric Sullivan and Cupid Alexander said the transition will include an overlap period and outreach to residents and the adjacent business community to reduce operational disruptions.
Vote: Council approved the grant and the related agreements unanimously.
