Feds buy two immigration detention centers for $1.5 billion
Private prison operator CoreCivic has sold two Southern California immigration detention centers to the federal government for $1.5 billion.
Under the deal, the U.S. Department of Homeland Security takes ownership of the Otay Mesa Detention Center in San Diego County for $739.2 million and the California City Detention Facility in Kern County for $732.6 million. CoreCivic owned and operated the centers, which were used to detain illegal immigrants under contracts with U.S. Immigration and Customs Enforcement.
Now DHS will own the properties. But CoreCivic will continue to run day-to-day operations under its existing contracts with ICE. CoreCivic’s contracts for California City run through 2027. The Otay Mesa contracts are through 2029.
Ryan Gustin, senior director of public affairs at CoreCivic, said both facilities were purpose-built and specifically designed to care for individuals in a secure environment. Gustin added that asset transactions of this nature are not uncommon for government.
“The process was marked with rigor and integrity,” Gustin told The Center Square Wednesday, answering questions by email. “The facility valuations were established through the federal government’s required appraisal process, which is designed to determine objective fair market value.”
For these specialized properties, Gustin said independent appraisers used a transparent cost-based methodology grounded in current replacement cost, depreciation, land value and other market-based factors, with the appraisals then reviewed by the government for compliance with federal standards.
The centers are in two vastly different locations. The Otay Mesa facility is in a San Diego foothills area next to the U.S.-Mexico border. California City is a community of about 15,000 people in the northern Antelope Valley, located 100 miles north of Los Angeles. The community is known for its vast open spaces stretching into the surrounding desert.
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