Maxwell Drever says currently, the pandemic has given the scope to several private businesses and government agencies to come up with new ideas for addressing the national shortage of low-cost workforce housing. And such a policy includes the conversion strategy for developing increased affordable workforce housing units. While several localities and states have leased the space in the motels to offer shelter for the people witnessing homelessness at the time of the pandemic, many states are coming up with scopes for acquiring and converting a few of such places to permanent housing, making use of local, state and federal resources.
Hotels are getting converted into housing units
Most of the new low-cost housing is getting developed for families who come beneath the 60% of the AMI level. Maxwell Drever says that the hotels would essentially be of help to the workforce population, who has an earning between the 60% and 120% of the area median income. The group comprises people like construction workers, police officers, nurses, teachers, firefighters, and others who struggle to come across a house near their employment place.
Transforming the hotel rooms in small apartments, usually between 300 and 500 square feet, can enable this section to reside in an affordable house near their office and save them from the lengthy daily commute and bring down traffic.
Coming across low-cost housing has been a problem for most. As per a published report, close to 37 million households in the United States got classified as house cost-burdened, as they used 30% of their income or more to pay for the house rent. And that invariably results in other problems and creates an imbalance in their life. Currently, this situation has gotten worse because of the sudden pandemic outbreak.
The pandemic outbreak, business loss and low hotel occupancy
Today, hotels that aren’t performing well are being put for sale, focusing on converting it into a housing unit so that the workforce population can stay there. The issues about housing can get reduced by such conversions. Going by the recent reports, the hotel occupancy rate in the United States declined to 26.6% annually. However, there have been some improvements in recent times, but still, there is a lot to recover.
And while one can say that there’s been a rebound in the section of leisure travel recently, because of the increasing vaccination, it might take about two to three years before the business travel increases and reaches its pre-pandemic levels.
Maxwell Drever says that even after the end of the pandemic, the hotel industry needs to stay content with the glut of rooms that got developed in the past decade. And the hotel owners who cannot hold the occupancy rates to get back to the days before the pandemic or aren’t able to make the required upgrades, it is a sensible decision to sell their properties so that they can get put to any multi-family use. After that, one can wait it out and even risk a further decline in the value of the hotel or even closure.