Nearly three years ago, the city bought the old Candlewood Suites along Pecan Park Boulevard in northwest Austin.
Neighbors have been against its conversion into homeless housing since the $9 million purchase.
In May of last year, people were caught on camera trespassing on the property, which was found to have extensive damage inside.
The city contracted Family Eldercare to renovate the building, but the group found significant structural problems.
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The building is still not open for supportive housing.
City leaders have extended the contract for renovations to March 2024.