Many hotels around the world were going through a crisis due to lockdown, home quarantine and social distancing, triggered by the global COVID-19 pandemic. The hospitality industry has been hit hard by the pandemic. Experts like Maxwell Drever identified another use for all these dilapidated hotels. He thought of converting these hotels into affordable workforce housing or multi-family rental properties. The use of former hotels and their spectacular transformation into multi-family rental properties is an evolving trend that could, to a remarkable extent, mitigate the growing demand for affordable workforce housing across the country.
The hospitality industry has been hardest hit by the global COVID-19 pandemic. But with vaccinations ramping up and the government’s decision to start easing COVID-related curbs to accelerate economic recovery, people are expecting hotel businesses to recover and turn around. Motels and hotels were expected to take a few years to fully recover. The question that arose was how motels and hotels would survive and sustain themselves until then.
Visionaries like Maxwell recommended the conversion of these dilapidated properties into inexpensive housing for the workforce. This should provide the much-needed lifeline for hotel and motel owners who may consider monetizing the property by taking advantage of other survival techniques and opportunities. It was a practical decision to convert old hotels into affordable housing instead of waiting and hoping to reach an elusive recovery target.
Conversion of hotels into affordable housing: a boon for many
It is a boon for the underprivileged sections of society to have the opportunity to live in old and struggling motels and hotels that have been converted into affordable multi-family housing. The conversion of stunning hotels and motels has created housing opportunities for people who could not dream of living in areas where buying or renting residential units was beyond their reach and far beyond their means or financial capacity. The disadvantaged population included low-income households, young working people, the homeless and even the elderly living on pension benefits and fixed incomes. Additionally, hotel conversions have proven to be a boon for people suffering from sudden pay cuts and job losses due to the impact of the global COVID-19 pandemic on the US economy.
The most favored segment
According to Maxwell Drever, the conversion of broken and dilapidated hotels and motels will particularly benefit people seeking housing for the workforce. These are housing units for households whose income is between 60% and 120% of the median income of the specific area. This group includes firefighters, police officers, nurses, teachers, construction workers, etc. They often do not have sufficient resources to rent accommodation close to their place of work.
Today, the majority of new and upcoming affordable housing is built for those disadvantaged homes that fall below the 60% AMI level. Unfortunately, people in the 60% to 120% AMI bracket are not getting adequate opportunities for quality, affordable housing in many markets.
By transforming hotel rooms into small, affordable apartments, between 200 square feet and 500 square feet, this underserved part of the population has had the opportunity to avail themselves of a reasonably priced home in locations close to where they live. of work. This ultimately helped reduce traffic and put an end to long daily commutes.
The global COVID-19 pandemic has been a blessing in disguise for many people. Although it has caused unimaginable misery or killed and devastated countless people across the world, it has created new real estate investment opportunities for the underprivileged part of society.