DHS buys two California migrant detention centers for $1.5B to boost ICE deportation capacity

The Department of Homeland Security has acquired two migrant detention facilities in California in a $1.5 billion deal, the agency confirmed to INC News.

The transaction included the 2,560-bed California City Detention Facility and the 1,994-bed Otay Mesa Detention Center, among the largest immigration detention sites in California. The sale closed earlier this month, according to a statement from CoreCivic, the Tennessee-based private prison operator that previously owned the facilities.

DHS said the purchase was funded through President Donald Trump’s spending legislation signed last summer, as the administration moves ahead with efforts tied to the president’s mass deportation campaign.

“The Department of Homeland Security purchased the California City Detention Facility and the Otay Mesa Detention Center,” a DHS spokesperson told INC News. “This purchase was made possible by President Trump’s One Big Beautiful Bill that allowed ICE to expand detention space to fulfill the President’s promise of mass deportations.”

Otay Mesa Detention Center

The Department of Homeland Security bought two California migrant detention centers for $1.5 billion. (Getty Images)

Federal officials say the acquisitions give the government additional capacity to implement Trump’s immigration agenda while reducing dependence on private prison companies. DHS has argued that California’s sanctuary policies are designed to limit immigration authorities’ ability to use privately run facilities to detain migrants living in the U.S. illegally.

“Unlike in states like Florida and Oklahoma, ICE can not rely on local state and county partners for detention space in California,” the DHS spokesperson said. “The state’s sanctuary politicians continue to push legislation to outlaw or make private prisons financially infeasible. Now, with federal ownership of these detention centers, which are crucial to ICE’s detention network on the west coast, ICE retains the detention capacity needed to arrest, detain, and remove illegal aliens.”

CoreCivic said it expects net proceeds to be about $1.1 billion after income taxes and transaction expenses.

CoreCivic's Otay Mesa Detention Center

The sale of the 2,560-bed California City Detention Facility and the 1,994-bed Otay Mesa Detention Center closed earlier this month. (Getty Images)

“We are pleased with the sales of these two mission-critical facilities for the Company’s government partner, which demonstrates the value of the Company’s underlying real estate portfolio, while reflecting our role as a long-term, flexible solutions provider to government,” CoreCivic Chief Executive Patrick Swindle said in a statement.

“The sale of these facilities at what we believe is a fair valuation provides the Company with significant balance sheet flexibility and positions us well to grow the Company’s businesses and return value to its shareholders, while remaining a dependable partner for government,” he added.

The company said it expects to continue managing the two facilities under existing management contracts with Immigration and Customs Enforcement, although the terms of the management contracts could be modified to reflect the change in ownership.

Migrant detention center

CoreCivic said it expects net proceeds to be about $1.1 billion after income taxes and transaction expenses. (Getty Images)

The California City facility contract expires in August 2027 and the contract for the Otay Mesa facility, which is located in San Diego, expires in December 2029, with the option to extend for five more years.

CoreCivic said it is in discussions with ICE about potentially selling additional detention facilities, although it said those talks are in various stages and cannot provide assurances that those sales will happen.

Eight ICE detention facilities are currently operating in California and combine to hold nearly 9,000 people.

The newly purchased California City and Otay Mesa facilities have both faced lawsuits by detainees over alleged mistreatment. CoreCivic has denied those allegations.

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