SAN DIEGO – A new development targeted to house the region’s homeless could see an added funding boost with an application announced Thursday by city and county leaders.

The application would net at least $11.8 million for the PATH Villas El Cerrito development from the state’s Project Homekey program, if approved, Mayor Todd Gloria and Board of Supervisors Chair Nathan Fletcher said in a joint release. That’s about half of what’s needed for the effort slated to be built in three phases that ultimately will include a health clinic as well as supportive and affordable housing units.

In a statement, Gloria said the city and county collaboration is the latest to “meaningfully address homelessness” by building out permanent housing with needed services for its tenants.

“This is precisely what was envisioned by Governor Gavin Newsom and the state Legislature when they created Project Homekey, and I’m grateful for all the ways the state is supporting local efforts to get unhoused residents into homes of their own,” Gloria said.

The new housing units will be built in the El Cerrito area on the site of a parking lot at 5476 El Cajon Blvd. as part of a partnership between PATH Ventures, Bold Communities and Family Health Centers of San Diego.

Construction on the first phase is planned to begin in November and could be done by next summer. It includes building out five levels with 41 prefabricated housing units, including 17 one-bedroom apartments, 18 two-bedroom units, five studios and one manager’s unit.

Included in the first phase from the city via the San Diego Housing Commission are 40 project-based housing vouchers officials say will offer “housing stability” for previously homeless San Diegans.

The second phase adds 140 affordable apartment homes and is expected to be finished by late 2024.

“Delivering viable opportunities for the unsheltered to leave the streets, get the rehabilitative services they need and put them on a trajectory to thrive is our goal for this new Project Homekey partnership,” Fletcher was quoted as saying.

The homelessness issue has long vexed state and local leaders, potentially worsening as rent and real estate prices in San Diego repeatedly soar to record highs.

It was singled out by Gloria in his second State of the City Address as his “highest priority” with the mayor calling for more shelter bed capacity and housing opportunities. He recently announced more than $60 million in the city’s proposed budget to battle homelessness, $14 million of which would address shelter capacity, services and outreach.

Under Project Homekey, California’s Department of Housing and Community Development pays out grant funding in what officials say is “an opportunity for state, regional, and local public entities to develop a broad range of housing types.” The current round of grant applications will be accepted until May 2, or whenever the state’s funding is exhausted, its website shows.

Next week, the county board will vote on $11 million in funds for the project and more than $2 million is expected to be paid out by the city through its share of California’s Permanent Local Housing Allocation program, the release shows.

The next step for the project comes Monday when the six-member SDHC Board of Commissioners will vote on the funding plan in a special meeting.