A site for a new homeless hostel in Hemel Hempstead has been identified in Redbourn Road.
The hostel would accommodate 33 people at an address opposite the Ford car dealership.
Officers at Dacorum Borough Council have drawn up proposals, which are due to be presented to the cabinet in October.
Any decision to press ahead would be followed by the normal planning process and a public consultation.
A council spokesman said: “Council staff have been working to find suitable council-owned land where the homeless hostel could be built.
“Initial feasibility studies have concluded that it is a suitable size to develop the proposed hostel.”
Last year the council was awarded £842,000 from the government to build the hostel to address the problem of homelessness.
The hostel is expected to be run by the charity Dacorum Emergency Night Shelter (DENS), which turned away 380 people from its existing 15-bedded shelter last year because it was full.
On average the charity turns away three people each night.
Of the people DENS saw last year, 52 per cent became homeless due to relationship breakdown, and more than a quarter were aged between 18 and 25.