Deal coming for still-empty hotel bought by Denver in 2023, city says

Deal to Sell Empty Denver Motel Could Happen This Year

Denver is in talks to sell a motel along Peoria Street that has remained vacant since the city purchased it in 2023 to house the homeless. The former Stay Inn at 12033 E. 38th Ave. was bought for $9 million with plans to convert it into supportive housing for the homeless.

Despite being boarded up, the 4-story motel has yet to accommodate anyone. In August, Denver’s Department of Housing Stability spokesperson, Julia Marvin, mentioned discussions with a potential development partner looking to acquire the property for $10 million. Although the deal did not materialize by the end of the year, Marvin indicated that progress is being made, with hopes of presenting the proposal to the City Council in the spring.

The negotiations with the development partner have advanced, with key elements of the project’s proposed financing falling into place. Denver has been exploring the idea of housing individuals in the building adjacent to Interstate 70 for over four years.

Former Mayor Michael Hancock and U.S. Rep. Diana DeGette announced the city’s intention to purchase the motel in May 2021, but the transaction was not completed until August 2023. While other hotels have been bought or leased by the current Mayor Mike Johnston to swiftly accommodate individuals experiencing homelessness, the former Stay Inn remains unoccupied.

The property, now under Denver’s ownership, is being considered for sale as the city seeks cost-saving measures. The building, which underwent renovations by the previous owner, requires additional work before it can be used for housing purposes.

Denver initially planned to undertake the necessary renovations but later opted to sell the property with a covenant mandating it to operate as income-restricted housing for 99 years. Rezoning requirements for housing occupants were scheduled for 2024 but were subsequently canceled, with the responsibility now falling on the potential buyer.