How the homeless bought a Rolls for Cornelius Pitts.

• Author: Szegedy-Maszak, Marianne
• Position: Getting rich by housing the needy

HOW THE HOMELESS BOUGHT A ROLLS FOR CORNELIUS PITTS

It is a typical 90-degrees-and-humid June day in Washington D.C. and Cornelius Pitts is an hour late. He bursts into the front office at the Pitts Motor Hotel, apologizes, then sits down in a maroon leather chair behind a large desk with lion-head drawer handles. A plastic plaque on his desk reads: "The trouble with some people is that they won't admit their faults. I'd admit mine . . . if I had any.' Pitts asks one of his staff to get him an ice cream sandwich. Maybe two. He is a very big man and his voice is deep and raspy. On one hand he wears a large diamond on a gold band, on the other, three slightly smaller diamonds on a silver band. He wears a very, very thin gold watch.

The only hints that Pitts's prosperity comes from an unconventional enterprise are the images on small black and white monitors in the corners of his office. They show what was once the hotel's luxurious Red Carpet Lounge slowly filling up with his newest--and most lucrative-- clients, homeless families getting their chicken dinner.

The homeless have been good to Pitts. If the city of Washington D.C. hadn't given him its sole-source contract for providing emergency shelter for homeless families in 1982, he might never have achieved what he calls his "100 percent occupancy' rate. He and his wife would probably not have made $245,000 in salaries, benefits, and profits from the contract last year. And if the city hadn't renewed his multi-million-dollar contract each year--even after mounting evidence of fiscal irregularities--he might never have been able to build all those additions on his upper Northwest Washington home, which is now assessed at $399,562. Or buy his five cars, particularly the $61,000 Mercedes 560 SEL and the $117,500 1987 Rolls Royce Silver Spur. (Both cars have three-digit license plate numbers, a sign of access to the top city officials who dispense them.) Indeed, without the contract, Pitts might have lost his hotel.

Pitts doesn't understand why people have been critical of his business practices. He says he runs a class place, that his hotel at 14th and Belmont, is as fine a shelter for the homeless as anyone could find anywhere. And if he makes a good profit, well, that's nobody's business. He is not, he points out, one of those nonprofits. His business, he says, emphasizing each syllable, is "a pro-fit-mak-ing-en-ter-prise.'

Rooms at the top

Living off government contracts was not the dream Cornelius C. Pitts brought with him when he came to Washington from New Orlens during World War II. At first, he worked as a clerk-typist for the War Department and moonlighted as a cab driver, saving his money for something bigger. He wanted to be successful in a white man's world. "I was determined to break through the color barrier,' he said in 1968. "I was born into business. My mother and father ran a mom-and-pop grocery store in New Orleans.'

In 1950 he made the leap, buying his first building on Belmont Street, then a middle-class black residential neighborhood. He converted his new property into a tourist home for blacks, who were not welcome in downtown hotels. Nine years later he bought another building on Belmont. Meanwhile, like the immigrant hero in a thousand American success stories, he went to college, and in 1964, at the age of 41, he graduated with a degree in business administration from Howard University. The next year he bought three more buildings on Belmont Street, then tore down all his buildings and constructed the Pitts Motor Hotel.

In the sixties, the Pitts Hotel was a showplace, and Cornelius Pitts was one of Washington's most successful black entrepreneurs. His hotel attracted not only tourists and traveling businessmen but local customers, black and white. They lined up at the Red Carpet Lounge--which featured valet parking and a maitre d'--to listen to the likes of Aretha Franklin. "The place stayed packed,' a former regular said. "The drinks weren't that high. You didn't feel like you were getting ripped off. The music was great. And the minute you walked in, you felt comfortable there.'

Pitts viewed himself as having a definite role to play in his community. "Whenever he could, he did something for the neighborhood,' says Leroy Hubbard, a local civic leader and long-time friend of Pitts. "He would donate food and space for neighborhood functions, sponsor kids in camps. He...