Many hotels across the globe were going through a crisis due to lockdown, home quarantine, and social distancing, triggered by the COVID-19 global pandemic. The hotel industry has been adversely affected by the pandemic. Experts like Maxwell Drever identified an alternate use for all these run-down hotels. He thought of converting these hotels into affordable workforce housing or multifamily rental properties. Using old hotels and dramatically transforming them into multifamily rental properties is an evolving trend that could to a remarkable extent end up easing the increasing demand for affordable workforce housing units across the nation.
The hospitality industry was the worst affected by the COVID-19 global pandemic. But with the vaccinations gaining momentum and the government’s decision to start relaxing the COVID-associated curbs for accelerating economic restoration, people are expecting the hospitality businesses to recover and make a turnaround. Motels and hotels were expected to take a couple of years for complete recovery. The question that came up was how would the motels and hotels survive and sustain until then.
Visionaries like Maxwell recommended the conversion of these run-down properties into inexpensive workforce housing units. This should provide the much-required lifeline for hotel and motel owners who could consider monetizing the property by availing of other survival techniques and opportunities. It was a practical move to convert old hotels into affordable housing units instead of waiting and hoping to accomplish an elusive recovery goal.
Conversion of Hotels into Affordable Housing Units: A Boon for Many
It is a boon for the underprivileged sections of society to get the opportunity to live in old and struggling motels and hotels that have been converted into affordable multifamily housing units. Conversion of staggering hotels and motels led to housing opportunities for people who could not dream of living in areas where buying or renting residential units was out of their reach and much beyond their means or financial capacity. The underprivileged demographic included lower-income households, young professionals, homeless persons, and even senior citizens living on retirement benefits and fixed incomes. Moreover, the hotel conversions proved to be a blessing for people with pay cuts and sudden loss of jobs because of the impact of the COVID-19 global pandemic on the US economy.
The Most Benefitted Segment
According to Maxwell Drever, conversion of broken and run-down hotels and motels will benefit particularly people looking for workforce housing. These are housing units for households with income between 60% and 120% of specific area median income. This group comprises firefighters, police officers, nurses, teachers, construction workers, etc. They often do not have adequate resources to rent a home that is near their workplace.
Today a majority of the new and upcoming affordable housing is constructed for these underprivileged houses that fall below 60% AMI level. Unfortunately, the people in the 60% to 120% AMI bracket do not get adequate opportunities for quality and affordable housing in several markets.
By transforming hotel rooms into affordable small apartments, between 200 square feet and 500 square feet, this underserved section of the population got the opportunity to avail themselves of a reasonably-priced house in locations near their workplace. It ultimately contributed to reduced traffic and end to long commutes every day.
The COVID-19 global pandemic was a blessing in disguise for many people. Although it has caused unimaginable misery or killed and devastated countless people across the globe, it has come up with new real estate investment opportunities for the underprivileged section of society.