Improve Housing Affordability by Converting Hotels the Way Maxwell Drever Suggests
The hospitality sector in general and hotels, in particular, were negatively affected by the COVID-19 pandemic. With hotels shut down restrictions on travel and tourism, the industry underwent a loss. In such a scenario, the transformation of hotel rooms into multifamily properties has become a growing trend. It has significantly helped the hotel owners with their financial burden. More so, it eases the pressing problem of the housing shortage.
The transformation of hotel rooms into affordable housing units is an opportunity that hotel owners and landlords view positively. Since the prices of rental property and new structures are increasing, the workforce population does not have the financial capacity to own them. More so, these young professionals with low-level incomes are on the verge of homelessness. The conversion has helped them get shelter and has impacted the economy positively.
Repurposing hotel rooms into apartments helps the workforce population state nearby their work location. Remember that the housing shortage is in and around the city centres that are industrial hubs.
Hence, the workforce population got compelled to stay away from the industrial sector into suburban areas. There was a scarcity of basic amenities in such locations added to the commute time. Finding affordable housing units has become an economic and social issue in every country. If you go by reports, you will see that 37 million households fall under this category. Around 40% of the world population comes under low and medium-income groups. Hence, they are severely cost-burdened.
Deal with the economic downturn with hotel conversion
Since the housing sector lacks supply, Maxwell Drever shows that underperforming hotels may contribute by converting their properties into housing units. As explained earlier, hotel conversion is an opportunity for hotel owners to reap the benefit. If you go by hospitality analysis, you will see that hotel occupancy has provided a smooth flow of income to around 40% of hotel owners. However, there is more to the story.
How to ensure better conversion?
Hotel conversion is a cheap alternative to new construction. Affordable rental and workforce housing projects are cost-prohibitive. However, while undertaking such a project, building codes, priced resources, and restrictive zoning play a vital role. Hotel owners must be cautious of these rules and regulations so that the conversion goes on smoother. As a result, the hotel industry and the developers are snapping financially distressed properties and building them into affordable housing units.
Hotels got converted in and around the job location. Close to the highways and major roads, several properties get converted into cost-effective housing units. Moreover, Maxwell Drever explains they provide an adequate pool, parking, basic amenities, and fitness centres. Hotel conversion extends the economic resources of a country. It caters to the workforce population, on the one hand, and helps the ageing hotels on the other hand.
Public-private partnership is the only means of ensuring better conversion. Remember that it is a commercial estate and an assessment of the firm is necessary with the help of sufficient experts. Various challenges are cropping up in these projects. Hence, determining the feasibility of hotel conversion and navigating the complicated building codes, requirements, and stringent zoning measures is the need of the hour.