In the last couple of years, hotel-to-multifamily conversions have come into popularity, especially due to COVID 19, when hotel occupancy rates took a plunge. Many buyers and renters have been excited about this process but of course, like all things, there are a whole lot of people that aren’t very welcoming to this change. Below is a small comparison of why these multifamily units are or why they aren’t here to stay.
Why Convert Hotels intoMultifamily Residential Units?
Well, housing affordability has been a significant challenge for quite some time now and hotel conversions can be a great way to provide attractive units in communities with great locations and that aren’t going to leave the client broke. Especially for renters, this sort of a deal is not just hard but near impossible to come by and simply allowsto have a better quality of life.
Now, how exactly this works is, when a new building or housing unit is constructed, the owner, of course, has to make up the money that was just spent and with it being a newly constructed unit, there’s cost that adds up to that as well. But when it’s just about making minor renovations to an already existing space, it’s obviously not near as expensive and renting the space out can happen much sooner. It’s a quick solution that doesn’t just work for the short term but also giveslong term satisfaction, whether from the perspective of the investor or renter.
But What Are the Challenges of These Conversions?
While the end result is very attractive and construction or renovation doesn’t take as long or cost as much either, these multifamily residential conversions from hotels aren’t a walk in the park.
The first and most significant problem that one might face is that the underlying zone simply may not even allow for the property to be used as a multifamily. Rezoning isn’t the easiest so the owner will have to go through a public hearing and a proper legal process before that happens. And when it does happen, it can take a couple of months to a year or sometimes even longer to get the paperwork done an actually have a permit for the conversion.
Kitchens (or lack thereof) are also a problem that is often dealt with when it comes to hotel conversions. Most hotels don’t have a kitchen attached to their offered suits so there’s definitely quite a bit of renovation that’s going to be required in that sense. Then, it’s also essential to look at building code requirements, fire walls and sprinklers, and emergency accesses.
Another obstacle can be utility meters that’ll be needed to be added to these units, especially if converting them into smaller residential spaces. A hotel generally doesn’t have a ton of individual units so that’s something that’s going to need to be installed too.
And once all of these changes are made, it does become quite hard to go back. It’s a lot of money invested, albeit less than if one was to construct a new building from the ground up.
So,What Does It Come Down To?
It’s important to think about if this is going to be a short-term venture or the investor is actually looking to permanently convert the hotel into a multifamily unit. If it’s a permanent answer, then this is it. There are a number of things that will need to be adjusted such as making space for kitchens, installing utility meters and so on, but in the long run, it’s much less expensive and less time consuming than a new construction.
And that’s where industry professionals come in. Figuring everything out on without professional help isn’t easy and well, a lot of money and time can be saved when working with someone who’s reputable.
One such industry expert is Yaima Lamela. Having earned an MBA from Florida International University in 2016, Lamela founded Prestige Empire Realty, to focus on quality real estate services and provide innovative solutions. When it comes to the Miami market, Lamela has years of experience and knowledge of the industry allowing the realtor to provide quality services to clients struggling to save up the money to make good investments. So, if one is looking for an experienced realtor that can be relied on, all that needs to be done is reach out to Yaima Lamela on www.yaimainversiones.com.