This has gone badly. The property sees intense vandalism and destruction, the neighbors are afraid for their safety, and the whole thing is an amazingly expensive boondoggle.
[0]: https://www.foxnews.com/us/austin-hotel-purchased-homeless-s...
[1]: https://www.statesman.com/story/news/2022/05/16/austin-homel...
The risk of course is that you are ripping potentially live circuits out of a building. It usually requires you to already be impaired and desperate to do it. It's that fun combo of illegal and dangerous.
1) Austin buys the property
2) Begins renovations on vacant premises
3) Vandalism takes place
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4) The conversion is complete
5) Property officially offered to homeless residents
Steps 4 and 5 haven't happened yet. So homeless people who "generally just destroy the living space" isn't a good fit for what's going on. This is simply a situation of an unsecured construction site that has attracted squatters and vandals.
Citation very much needed here. This certainly does happen. But, I don’t believe this the general (i.e. typical) outcome. From what I understand talking to acquaintances who work in this area, wrecking the place is not the typical outcome. And property damage is generally cheaper to address than the constant provision of emergency services.
I agree that mental health (and substance use) are major factors in homelessness, but those issues are more or less impossible to address when people are living on the street with no permanent address and no place to keep e.g. a cell phone without it being stolen.