Even in L.A.’s famously overheated real estate market, the profit — and quick turnaround — on a senior housing complex in the Cheviot Hills neighborhood seemed extraordinary.
The man at the center of the deal, since identified by federal prosecutors as Brentwood landlord and developer Steven Taylor, bought the property on Shelby Drive in 2023 for $11.2 million, purchase records show.
He wasn’t planning to hold on to the complex for long. At the time of his purchase, a company owned by Taylor already was in escrow to sell the complex to Weingart Center, a major homeless housing provider, for more than double what he paid, according to a purchase agreement obtained through a public records request.
The $27.3 million to pay for that acquisition came from taxpayer grant funds authorized by city and state officials, according to grant documentation. L.A. Mayor Karen Bass and Gov. Gavin Newsom touted the purchase as a key tool in the fight against homelessness.
The deal called for Taylor’s involvement to be kept secret, according to a confidentiality clause included in the purchase contract obtained through a public records request.
That changed last month, when federal authorities announced criminal charges against Taylor. He’s accused of submitting fraudulent documents to borrow money from private lenders when he bought this and other properties.
At a news conference, the region’s top federal prosecutor, Bill Essayli, said the investigation is ongoing.
Taylor was arrested in August, when the case was under seal, and pleaded not guilty, court records show. It’s the first of the two known criminal cases brought so far by the federal task force Essayli assembled in April to investigate fraud and corruption around the use of billions of dollars earmarked to combat homelessness in Southern California.
Essayli announced the task force after a court-ordered review and a federal audit found city and state officials have failed to properly track homeless funds and protect against fraud.
Taylor and his attorney, Michael Freedman, have not responded to LAist’s phone messages for comment.
LAist’s review of the Cheviot Hills property deal found the purchase stands out not just for its high price tag but for the complexity and secrecy surrounding it.
The records reviewed by LAist show:
- A purchase agreement shows Taylor was in escrow to buy the property when city and state officials agreed to use taxpayer funds to buy it from him for $27 million.
- Weingart Center’s application for state funding included an appraisal report containing inaccurate information about who owned the property and did not mention the pending sale.
- L.A. Mayor Karen Bass’ office had a “big role” in the city’s process that recommended this property and two others for the government grants, according to an email from a top executive at the city housing department.
- A Weingart Center leader said the property, now known as Weingart Shelby, isn’t expected to open until next year, despite the grant originally requiring it to be fully occupied by February 2025.
Bass’ office did not answer questions regarding the purchase. In a statement to LAist, the mayor’s office said the Shelby site “remains an important property providing interim housing in an area of the city that has extremely limited interim housing supply” and that the city is cooperating with the ongoing federal investigation.
Weingart Center’s longtime president and CEO, Kevin Murray, whose signature is on the purchase deal, has not responded to LAist’s requests for comment. He previously told the L.A. Times he had “no prior relationship with the seller and no continuing relationship” and that taxpayers paid fair market price.
Murray and Weingart Center’s chief of real estate development, Ben Rosen, have been placed on leave, according to news reports last month. Rosen also has not responded to LAist’s requests for comment.
The nonprofit’s board has elevated Chief Operating Officer Tonja Boykin to lead Weingart Center and has commissioned an outside investigation, a spokesperson for the nonprofit told LAist.
“In light of recent reporting raising questions concerning the valuation of certain homeless housing projects, we have retained an outside law firm to conduct an internal review of related subjects,” said the statement from spokesperson Stefan Friedman.
This summer, city leaders in Torrance publicly raised concerns that the group was massively overpaying for a hotel property under another round of state homelessness grants.
An LAist review also found Weingart Center has received more than $100 million from taxpayers despite failing to comply with audit requirements since 2022. The latest available audit, of the fiscal year ending April 2023, concluded the organization had multiple failures in tracking taxpayer money it was handling.
(Click here to read another LAist article, also published today, about financial concerns around other Weingart Center activities.)
Weingart Center’s spokesperson said the group remains committed to addressing homelessness, including serving almost 2,000 people daily through interim and permanent supportive housing sites across L.A.
The backstory on the $27 million property
The Shelby property was built in 1968 and was operated more recently as an assisted living facility for seniors, according to a 2023 city report on the 76–unit property.
Bridge Investment Group, one of the nation’s biggest owners of senior housing, paid $12.05 million for the property in April 2015, according to public records.
Bridge later sold it to a Taylor-owned company in December 2023 for nearly a million dollars less than the group bought it for eight years prior.
A spokesperson for Bridge told LAist the company had reviewed the sale and found it had been “conducted in accordance with our established processes.”
“Integrity and compliance are foundational to our business. As a sophisticated real estate investor, we are confident in our team’s honest conduct,” said the statement provided by Bridge.
The spokesperson added, “We were neither involved in nor aware of the buyer's subsequent transaction.”
Bass’ office had a ‘big role’ in selection process, per city email
In spring 2023, the city of L.A. was on a third round of state Homekey grants — a program launched by California in 2020 as a way to quickly expand the homeless housing supply, initially by buying motels and hotels and renovating them.
Weingart Center was one of about two dozen groups that submitted 31 proposals to the city in March 2023, according to city records.
Under Homekey, cities and counties can partner with nonprofit or for-profit developers to apply for the grants. If chosen, the non-government partner buys the property with the grant money, and the partnering city or county chips in a sizable amount of money too.
Weingart Center initially proposed an existing hotel property in Harbor Gateway, along the 110 Freeway, in their grant application.
Then, in a March email to city officials, Bass' director of affordable housing production said they’d “identified a new potential site for Weingart,” listing the Shelby Drive address. Weingart changed the proposal to the Shelby site in West L.A. in May 2023, records show.
“The mayor's office did play a big role in the selection process,” states an email from Eric Claros, director of housing at the city’s housing department, which LAist obtained as part of an open records request.
Claros and a spokesperson for the housing department declined to speak to LAist about the selection process.
In late May 2023, Bass’ office informed the office of Katy Yaroslavsky — the city councilmember who represents Cheviot Hills — “that they planned to include the Shelby property in the city's application for Project Homekey 3.0 funding,” according to Yaroslavsky’s office.
A few days later, on June 9, 2023, the city’s housing department officially recommended that the City Council approve the Shelby property as one of three projects to receive city funding and to jointly apply for Homekey grants.
Taylor signs deal to buy the property
On June 16, 2023, less than a week after city staff publicly recommended the Shelby project for state funding, Taylor went into escrow to buy the property from Bridge, according to a copy of that purchase agreement the city disclosed to LAist. The price negotiated at that point is redacted in the copy the city disclosed.
Taylor signed the deal to buy the property on behalf of an LLC he later said he was the sole owner of, according to an email disclosed by the city.
Twelve days later, the City Council took the housing department’s recommendation and officially approved the Shelby property as one of three sites the city would partner on to unlock state grant funds. In doing so, the city agreed to pay $20 million toward the purchase and to unlock the other $7 million from the state to purchase the property.
The project called for another $15 million in state funds to be set aside for renovating and preparing the property after the acquisition, plus another $15 million in city and state funds to cover at least four years of operations.
The state says the money it gave for the purchase and renovation came from federal dollars given to states during the COVID-19 pandemic.
(Click here to see a breakdown of taxpayer funds the city and state committed to the project.)
The taxpayer-funded deal to buy from Taylor
Murray signed the agreement for the Weingart Center to buy the property from Taylor for $27.3 million in taxpayer funds July 26, 2023, according to a copy of the purchase agreement the city released in response to a public records request. At that time, neither Taylor nor his affiliated companies owned the Shelby site.
The agreement states Murray, on behalf of Weingart Center, acknowledged the seller — Taylor — didn’t own the property but was in escrow to buy it.
As part of the purchase agreement, Murray — one of the two Weingart Center executives now on leave — agreed that Weingart Center — the taxpayer-funded buyer — never would identify Taylor to the public or news media as the seller, nor would it reveal the deal’s terms, outside of narrow exceptions.
The deal also said it was expected that an “affiliate” of Taylor would buy the property from its owner and complete the sale.
Appraisal problems
Ahead of the sale, the Homekey grant application required a property appraisal, which Murray commissioned and received in July 2023. LAist obtained a copy of the appraisal from the city through a public records request.
The Shelby appraisal report doesn’t mention that the property was under contract at the time to be sold. The state’s requirements for Homekey appraisals say the reports should include information about any pending sales of the property being appraised.
Instead, the appraisal states Weingart Center was buying the property directly from its then-owner for $27.3 million. The report incorrectly identifies the owner as an LLC owned by Taylor. As a title report attached to the appraisal shows, the property still was owned at the time by the subsidiary of Bridge.
The appraisal report gave several estimates for the property’s value, depending on the method.
When looking at nearby sales of apartment complexes and adjusting for differences, the appraisal estimated the Shelby property’s value would be $19.4 million — about $8 million less than what taxpayers were paying and $7 million more than Taylor was paying.
Other methods in the appraisal generated higher value estimates, including two estimates right around $27.3 million — the amount the report says Weingart Center already had agreed to pay for the property. Those methods looked at similar sales of assisted living facilities and the estimated income the property would garner as an assisted living facility.
The company that conducted the appraisal, BBG, defended its process to LAist.
“The appraiser handled the appraisal assignment correctly with the information they were given,” said Peter Christensen, BBG’s general counsel and chief compliance officer.
Weingart Center sent a copy of the appraisal to the state housing department July 27, 2023, as part of its application with the city for Homekey funds.
State approves grant
With the appraisal and other application materials in hand, state officials awarded over $22 million in Homekey money toward the purchase and renovation of the Shelby property in November 2023.
Records show a business that had Taylor as its point of contact completed the purchase of the Shelby property for $11.2 million Dec. 26, 2023. It was six months after Taylor entered escrow to buy it and about a month after state officials committed to fund Weingart Center’s purchase for double that amount.
The taxpayer money changed hands in April 2024, when Weingart closed on buying it from the company linked to Taylor. No improvements to the property were documented in city permit records during that time.
The Homekey grants are overseen by the California Department of Housing and Community Development (HCD), led since 2020 by Gov. Gavin Newsom appointee Gustavo Velasquez.
The department declined to answer questions about their approval of the Shelby grant, following the federal announcement. A spokesperson cited the ongoing investigation, saying the department is cooperating with the U.S. Attorney’s office, which “has made it clear the department is a mere witness in this matter.”
Delays in opening
In addition to the $27 million in public funds to buy the property, Weingart Center was approved to spend another $15 million in state funds for renovations and other costs to prepare it to become housing for people in need of shelter.
The state grant originally required Weingart Center to finish all construction and rehabilitation work by Nov. 21, 2024, and have the housing units fully occupied by Feb. 21.
Those deadlines have moved significantly, as work on the facility continues and runs into problems like asbestos and mold, according to city permit records and state records.
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What’s next
Weingart Center says upgrades aren’t expected to be completed until late February 2026, more than a year later than the original schedule. The state has granted multiple extensions, with the deadline for full occupancy now set at April 21, 2026.
LAist reporters Ted Rohrlich, Jordan Rynning and Elly Yu contributed to this story.
