Weekend Interview: Elizabeth Funk On How Interim Housing Can Help Solve Homelessness

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Urban property values across the U.S. eroded after the pandemic, and landlords are just beginning to recoup some of their losses. Homelessness and the proliferation of homeless encampments in downtown areas also soared after the pandemic, with California Gov. Gavin Newsom in July directing governments to crack down on the issue.

One commercial real estate sector, affordable housing, has been busy trying to alleviate homelessness and potentially enhance downtown property values.

Dignity Moves, a nonprofit interim housing provider active across California, is among those seeking to create a bridge that will help people experiencing homelessness find a place to live.

A former employee of Microsoft and Yahoo who is used to moving at tech’s breakneck speed, Elizabeth Funk leads Dignity Moves as its founder and CEO.

Bisnow sat down with Funk to find out what Dignity Moves is doing to alleviate homelessness and revitalize downtowns. 

Bisnow: Dignity Moves is a relative newcomer to the affordable housing industry and Bay Area. Tell us what Dignity Moves does and how long you’ve been around. 

Funk: Dignity Moves has been around for about three years, and we're specifically focused on unsheltered homelessness, which is the most visible and the most inhumane. But it’s the part that is solvable. We just haven’t addressed it. 

Unsheltered homelessness usually is addressed by what we call shelter. However, shelter for the last 10 years has been divested by [the Department of Housing and Urban Development] because shelter doesn't work. Shelter gets you out of the elements, but it doesn't do much more than that. 

So, we have correctly identified that the only thing that ends homelessness is permanent housing. But it takes too long to build and it costs too much.  

Bisnow: What are some interim housing solutions Dignity Moves is working on?

Funk: Most people think of tiny homes and cabins, such as the project we did at 33 Gough St. But we also educate the system about the benefits of interim housing.

The Interim Housing Act just passed at the state level, which was authored by Sen. Josh Becker and sponsored by the Bay Area Council, Dignity Moves and [San Jose] Mayor Matt Mahan. 

Mahan has been the one courageous mayor who says, “I don't care what the metrics say is the right thing to do.”

And they've done a lot of tiny houses in San Jose and have long waitlists for that housing.  

Interim housing is still an uphill battle, and the powers that be, for valid reasons, are opposed. A lot of what we are doing is changing the narrative. 

Bisnow: Where does Dignity Moves get its funding? 

Funk: We typically take a project fee when we build. Our projects are funded from a variety of sources. We’ve done several with Project Homekey. We sometimes are funded by city or county budgets. Often philanthropy plays a role.

Our Gough Street project was $2.2M, and 90 people live in it. That’s a size a philanthropy can bite off.

Dignity Moves is trying to implement change on a systems level. Philanthropists have been supporting our work, which is not scalable. It's where we've gotten to date, although we are pursuing more sustainable sources.

Bisnow: Right now, San Francisco-based Dignity Moves only does California projects, or are there any outside the state? 

Funk: We haven't done any projects outside of California, but we're working on it. 

We've got projects in San Francisco, Santa Barbara, Alameda, Rohnert Park, San Luis Obispo, Watsonville, Modesto, Santa Maria and other places. 

There's no shortage of unsheltered homelessness in our state. Half of the nation's unsheltered are in California. So from a business perspective, it's a big market.

Bisnow: How did you get started in the interim housing industry? 

Funk: I sort of stumbled into it. I spent most of my career in technology. In my early years, I was at Microsoft and Yahoo, and so I have that disruptive gene in me. And I was really looking at this with some friends because it's a head-scratcher. We keep spending more money, and the problem keeps getting worse. 

It was during the pandemic when we all had some downtime, and the more I started looking into it, the more I thought, “I'm going to have to do this.”

It was obvious that it was costing so much to build permanent housing and the fact that the system was totally opposed — that’s when I knew I was onto something. 

When people first become homeless, only about 20% have a debilitating mental or behavioral health issue. It's being on the streets that's causing that, and they were self-sufficient yesterday when they became homeless. 

If we had enough places where people could go immediately, we could prevent that trauma from converting into chronic homelessness.

Bisnow: As an interim housing provider and a 3-year-old company, Dignity Moves is basically a startup, right? 

Funk: It kind of blows people's minds, because I come from Yahoo, where I was sleeping under my desk. Don't tell me we can't end homelessness. You just start with, “Yes, we can.”

Some housing projects take 10 years to complete, but I don't have that kind of patience. So there's a mindset that things need to be done quickly, and there's also a perfectionist mindset.

I didn't realize what a contrarian culture it would be to come in [to the housing industry] with a Silicon Valley mindset and say, “Let’s make some decisions and get to work!”

Bisnow: What is Dignity Moves’ key to success?

Funk: I'm moving at my pace, whether they can keep up or not. That's probably the key to success. Our secret advantage is to be able to bring that nimbleness.

Bisnow: What are some of the biggest challenges that you face as an organization? 

Funk: Finding vacant land. Getting owners to be willing to give it to us or lend it to the cause. 

Another big hurdle is that people have lost the urgency. There's a crisis. If there was a hurricane or an earthquake, this wouldn't be a problem. We'd have all these people indoors right away. But we've gotten so used to seeing people live on the streets.

Shame on us. I hope our grandkids look at us and ask why. It’s just four walls and a roof. It is not sending somebody to Mars.

Bisnow: What is Dignity Moves doing from a development perspective to help ease the housing crisis? 

Funk: New housing doesn’t have to have solar panels and fancy windows. I understand the aspirational aspect of it, but that's what's making our housing costs crazy high. So what we get to do is use emergency building codes, because the city is declared a shelter crisis. That’s what we need to be doing and treating this like the crisis that it is.

It will give cities the power to waive zoning, land use and procurement and all the red tape that creates this. The question becomes a philosophical one. We can end homelessness. 

Bisnow: How has Gov. Newsom's order to remove homeless encampments on state-owned property impacted what Dignity Moves does?

Funk: So, it’s good and bad. It’s getting us to look for immediate solutions.

On the other hand, it doesn't come with funding, and it doesn't come with changing metrics. So while it’s saying, “Get people into housing now,” which is idealistic, I hoped that it would also come with some funding, or at least a directive to shift funding. 

But on the other hand, I also don't want to be on record saying I want to take money from permanent housing. Permanent housing needs all the resources it can get, but you can't just tell cities to get everybody indoors, and you guys figure it out. But it's a signal in the right direction. 

In the meantime, it puts cities in a bad place. Putting them in jails is an expensive solution at $400 a night. You shoo them out of the city limits, and they're going to go into the environment and cause environmental disasters like wildfires and impact our water system, or they go to the next town and you end up with civil war. 

Bisnow: Give us a bold prediction for the rest of the year and as we enter 2025.

Funk: I’m an internal optimist on this subject. I believe the stars are all aligning and there’s going to be an answer on the issue of homelessness.

The combination of the Supreme Court and Newsom's ruling, the combination of the rock bottom and the public's patience, and examples where cities are actually having success and ending it. San Jose is working towards that.  

Once people see that cities are actually ending this problem, I hope it’s going to be contagious. 

Bisnow: What is your weekend routine or activity that you like to do? 

Funk: I admit when Friday afternoon comes, I think, “Oh my God, now I can finally get some work done.” At least I don't have meetings on weekends. When the meetings are all over, one of the things I really do enjoy is writing about this and spreading the word and that kind of stuff you can't do in 10-minute increments.

This weekend, I'm going down to visit my son for parents weekend. My kids are off in college, so parents weekend stuff is my favorite activity on weekends.