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Steven J. Murphy, once a homeless Vietnam vet and now a millionaire, has not forgotten his past. He has bought a home and apartments for recovering veterans. Now they have . . . : A Place of Their Own


MAR VISTA — Stephen J. Murphy knows what it's like to be down on your luck. Less than a decade ago, he was an alcoholic and living in a soon-to-be-repossessed Corvette.

But Murphy's luck has turned around.

In six years, Murphy has amassed a fortune by buying foreclosed properties at bargain basement prices. In an ironic twist, he made millions from the misfortune or bad business sense of others.

"I have slept behind garbage cans. I have slept in parks. I have slept in abandoned construction sites," Murphy said recently as he sat in his comfortable penthouse offices in Marina del Rey, complete with an expansive ocean view.

The 44-year-old president of American Capital Investments Inc. has not forgotten his past and is not content with just changing his own life.

Last year, Murphy launched the American Capital Foundation for the Homeless, which purchases foreclosed residential properties and transforms them into group treatment homes for veterans trying to kick alcohol or drugs.

Earlier this week, three veterans moved into Murphy's latest acquisition, a three-story, $1.1-million apartment building on Wade Street in Mar Vista, a home that eventually will house 45 to 50 veterans. It is the third such project that Murphy has undertaken.

Murphy's foundation is affiliated with New Directions, a nonprofit group that operates the rehabilitation programs in Murphy's buildings.

New Directions began in 1977 as a residential treatment program at the Veterans Administration Hospital in Westwood. In 1989, the VA, facing budget cuts, withdrew funding for the program. John Keaveney, a New Directions graduate who returned from the Vietnam War a heroin addict, turned the program into an independent organization with former residents Alvin Jones and Larry Williams.

Murphy began his affiliation with New Directions in September, 1992, when, according to Keaveney, he saved the day for nine veterans. The vets were about to be evicted from New Directions home because the previous owner was into foreclosure. Murphy stepped in, buying the 3,000-square-foot, four-bedroom home on South Barrington Avenue in Mar Vista for $390,000.

Although the house is in Murphy's name, New Directions has full use of it. And within five years, Murphy said, he will turn over the deed to the house to New Directions, which is funded by donations from private firms and local veterans groups.

In addition to the two houses in Los Angeles, Murphy's foundation owns a third in New Haven, Conn.

"I'm in the business of saving lives," Murphy said. "I want the guys . . . to become self-sufficient--to take pride in what they do."

Toward that aim, Murphy plans to buy a carwash soon where the veterans can work.

When that happens, the vets will be expected to pay rent instead of living rent-free as they do now. In addition, Murphy recently provided a $10,000 for no-interest educational loans so that the tenants can learn new skills.

Being in the real estate business, Murphy is keenly aware of the importance of getting good tenants, and the veterans have not let him down. "You couldn't ask for better," Murphy said.

The veterans take special pains to make their home a pleasant refuge, as witnessed by the well-polished hardwood floors and well-kept rooms. The residents maintain a garden, in which they grow cantaloupes, cabbage, corn, watermelon and green beans.

Those in the rehab program, which includes group therapy and assertiveness training, are urged to reach out to those less fortunate.

"It's our way of giving back," says Bruce Melson, 42, New Directions' administrative coordinator, adding that veterans feed the homeless, give talks to children about the Vietnam War experience and work with gang members.

Veterans are referred to New Directions by the Veterans Administration Hospital, Clare Foundation and other agencies. Applicants are screened by current residents, who decide if a veteran can enter the program.

"The criterion is how willing they are to change from the old mode of behaviors which kept them homeless to a type of understanding of how to accept life on its own terms," Melson said.

Murphy understands how important that is.

"I was very self-destructive. I was more interested in pursuing alcoholism than anything else," Murphy said of those low days in 1985 and 1986 when he was "dodging the repo man" and working odd jobs to feed himself and pay for alcohol.

As with many Vietnam vets, Murphy thinks the horror of participating in front-line action took its toll on him. He spent 11 months in the 1st Infantry Division (the "Big Red One") that he says triggered trauma and stress. Discharged in 1970, Murphy stayed in Saigon, working for the U.S. Army procurement office.

Upon returning home, Murphy obtained a political science degree from UCLA, worked as a stockbroker and as a publisher of international banking and trade books, all despite a mounting drinking problem. But eventually alcoholism led Murphy to destitution.

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