Converting Hotels to Housing
The National Association of Realtors (NAR) has released new research on the conversion of hotels and motels into housing. While the study was spurred by a 37% drop in hotel occupancy rates driven by the pandemic, the findings have broader implications. Hotel conversions provide a means to simultaneously create renewed profitability and help address the national housing shortage.
Commercial members surveyed
A survey was sent to 75,000 commercial members of the NAR between February and March of 2021. 168 reported being engaged in the sale, leasing, development, property management or appraisal of converted hotels/motels between 2018 and 2020. Of the reported conversions:
- 79% were for housing.
- 12% were for homeless shelters, either temporary or permanent.
- 6% were for healthcare or quarantine facilities.
- 3% were for retail, industrial, ranch land or other development.
The report ends with five case studies detailing acquisition, zoning, renovations and expected final property values. For those interested in engaging in hotel/motel conversions, they’ll find an excellent road map in this report.