In the effort to address the current shortage of apartments in Hong Kong, the country's top developers are looking into transforming hotels into residential spaces. This initiative comes as the tourism industry in the country remains at the lowest since the COVID-19 pandemic hit.
The property developers are working with the government in repurposing hotel rooms in the city and convert them into residential apartments for people looking for a place to call home.
Tycoon Victor Li is leading the trend after converting two of CK Asset Holdings' hotel buildings into apartment rooms. On February 26, Li's development received a go signal from the government to transform its hotel in Ma On Shan are into 758 apartments.
One of Victor Li's hotels in the New Territories will also be converted into housing. It is expected to provide more than 5,000 homes after the government approved the initiative last year.
Developer CSI Properties is following Victor Li's footsteps by converting its Jordan hotel into office and residential use.
Transitional Housing
Meanwhile, the Hong Kong government allocated HK$95 million (or S$16.4 million) to fund at least 800 hotels and hostel rooms to be occupied by families in the next two years.
Transport and Housing Secretary Frank Chan said in a February blog post that the government is currently in discussion with more than ten hotels and hosters to provide temporary housing for the less fortunate residents of Hong Kong.
The hotel rooms turned apartments will also serve as transitional housing for eligible residents in the line with receiving public housing apartments.
Pandemic-Hit Tourism Industry
Just like the rest of the world, converting hotel rooms into residential spaces is a sensible move since the tourism industry has no signs of recovering due to the coronavirus global pandemic. Since the COVID-19 hit last year, the travelers around the world dropped by 90 percent.
While the tourism and hotel industry takes a step back, the demand for residential homes continue to remain strong in all parts of the world despite the economic crisis.
"Also affected by the pandemic and the economic downturn are low-income families living in subdivided units waiting for public housing," Chan said in his blog post.
"Unemployment or underemployment add to their burden, making the demand for transitional housing even greater," he added.
Converting New York Hotels Into Affordable Housing
Aside from Hong Kong, converting hotels into affordable housing was also an option for empty New York hotel rooms.
A new State senate bill proposed to allow the State to purchase financially distressed hotels and office buildings and turn them into affordable housing.
The bill sponsored by Queens Democrat State Senator Michael Gianaris also targets to provide shelter for those feeling a dangerous situation. Gianaris told "The Wall Street Journal" that the bill will only be available to struggling commercial real estates that are up for sale due to economic woes.
Under the proposed bill, the companies would sell hotels and office buildings to the State, which will convert the properties to affordable apartments so the homeless and financially challenged people can have a place to call home.
The bill will only allow hotels with less than 150 rooms, which comprised many hotels in Manhattan.
