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San Diego
Monday, May 20, 2024

$119M Salvation Army Project for Homeless Advances

REAL ESTATE: Rady Center Will Include 130 Shelter Beds, 90 Apartments

SAN DIEGO – The Salvation Army, in partnership with Wakeland Housing and Development Corp., is moving ahead with plans to build a $119 million complex in downtown San Diego that will provide temporary and permanent housing and services to homeless individuals and families.

Col. Lee Lescano
Project Manager
Salvation Army

Named after philanthropists Ernest and Evelyn Rady, the 200,000-square-foot Rady Center at 825 7th Ave. will cover a full city block bracketed by 7th and 8th avenues and E and F streets.

“What we’re building is a combination of everything from short-term housing through permanent affordable housing,” said Col. Lee Lescano, project manager for the Salvation Army.

“Our goal really is to create a community of transformation and help people move from homelessness to productive living in society,” Lescano said.

The 155,000-square-foot center will include a six-story apartment building to be built by Wakeland Housing and a four-story Salvation Army building that will include a 5,000-square-foot health clinic, a chapel, a homeless shelter, and short-term housing.

Short-term housing will include 80 shelter beds for the homeless, 10 transitional housing beds for homeless men with a substance abuse disorder, severe trauma, or had been involved in domestic violence, and 40 beds for homeless men in early recovery from substance abuse.

The complex will also have 90 apartments for homeless individuals in a mix of 20 studio apartments for individuals with annual incomes of up to 25% of the Annual Median Income (AMI), 40 studios for homeless people with incomes of 40% to 50% AMI, 29 one-bedroom apartments for homeless individuals with annual incomes of 30% to 60% of AMI, and a two-bedroom manager’s apartment.

M.W. Steele Group, based in downtown San Diego, is the architect.

‘Confident’ in Finding Financing

Lescano said that the Salvation Army has a proven record of getting people off the streets, with 78% of those who stayed in the organization’s transitional housing moving on to permanent housing and 95% of those placed in permanent housing staying there.

“We know that we can do it, we do it well, and we have a lot of examples of people who have transitioned,” Lescano said. “This is really, we believe, the answer to what’s going on.”

Wakeland Housing is managing the overall project and has been tasked with finding additional public and private funding for Rady Center.

“Our job is to work on all the things that are necessary for predevelopment, from permits to hiring architects, contractors and other consultants to both design the project and ultimately, get the project built,” said Peter Armstrong, Wakeland Housing vice president for real estate.

Pending financing, construction is tentatively set to start in the fall of 2025 with a goal of opening the center in 2027.

“There’s definitely a scenario where we can make that goal,” Armstrong said. “I like to think that’s going to happen.”

Peter Armstrong
Vice President, Real Estate
Wakeland Housing

Armstrong said that Wakeland Housing must raise $71 million in public and private funding, in addition to the money the Salvation Army raises and the land it is contributing, valued at $18 million.

“There’s kind of budget challenges at both the city level and state level,” Armstrong said. “Resources are not as robust as they have been in the last few years.”

Despite the challenges, Armstrong said that “I’m confident that we’re going to be able to raise the money.”

“The concern for all of us is, we want to make this happen as soon as possible,” Armstrong said.

Competition for state funding is particularly intense, but Armstrong said that the Salvation Army project “has a number of things going for it – the fact that Salvation Army is donating basically the entire city block, the fact that there’s already been significant money raised through philanthropies.”

Leading Philanthropist Spurs Initiative

The Radys have pledged to donate $30 million to establish a permanent operating endowment for the center and will contribute an additional $5 million toward the center’s construction once the Salvation Army raises $30 million.

Rady in February was given the Crystal Globe award by the San Diego Chapter of Lambda Alpha International for his philanthropic contributions, including his work with the Salvation Army.

The award recognizes an exceptional lifetime body of work relating to land use, real estate development, and land-use economics.

With the help of the Radys, the Salvation Army had raised $27 million for the new Rady Center as of late April, including $10 million from Margaret A. Cargill Philanthropies.
The Salvation Army also is donating the nearly one-acre site.

Rady said that he and his wife are donating a total of $50 million to the Salvation Army toward construction of the $20 million Rady Residences in Kearny Mesa, which opened in 2020, and Rady Center.

Ernest Rady
Chairman & CEO
American Assets Trust

Rady said that he sees Rady Center as part of what he calls his homeless initiative.
“When I drive down the street and I see people living in a tent and you and I are so blessed, I feel badly for them if you want to know the truth. Everybody, myself included, has ups and downs but their downs must be tragically down,” Rady said. “This initiative isn’t going to solve the problem, but it will at least be what I feel is my share to help.”
Rady said that he chose to work with the Salvation Army because it has more than a 100-year history working with the homeless.

“I have a high degree of confidence that after Evelyn and I are gone, they’re still going to be there to carry on this initiative,” Rady said. “The one message that I would like to send is, I hope that other people feel like they would like to share and help. It’s not only on the Salvation Army’s shoulders. It’s on the community.”

The Salvation Army’s Rady Center will provide temporary and permanent housing and services to homeless individuals and families. Rendering courtesy of the Salvation Army

Salvation Army
BUSINESS: nonprofit charitable organization
EMPLOYEES: 172,748
CONTACT: 619-231-6000;
NOTABLE: The Salvation Army annually helps nearly 24 million Americans overcome poverty, addiction, and economic hardships through a range of social services. By providing food, emergency disaster relief, rehabilitation services, clothing and shelter, The Salvation Army is meeting human needs at 6,914 centers of operation across the country.


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