Suburban Cities Are Working To Shut Down Hotels Keeping The Most Vulnerable People Housed

Across the country, local governments are fighting to regulate or close down extended-stay hotels, particularly the low-cost accommodations they view as hubs of crime and illicit activities.

But their battles against these hotels — where guests can pay by the week and stay for as long as desired — often have collateral damage. They are often the last housing resort for many low-income, transient workers.

“For a lot of people, that's the sort of last stop before they end up being homeless,” National Alliance to End Homelessness Vice President Steve Berg said. “The fact remains if that housing resource disappears, then the next step down is going to be a homeless shelter.”

Suburban cities that are trying to shut down extended-stay hotels dot the landscape. In the village of Burr Ridge just outside of Chicago, a developer last year nixed plans for an extended-stay hotel after the local economic development authority expressed concerns that it would contribute to area crime. Oakwood, Georgia, recently rejected a developer’s plans for a Candlewood Suites extended-stay hotel because it did not fit into the “character” of the land-use plan, The Gainesville Times reported. Last year, the Greenwood, Indiana, City Council passed new ordinances that allow the city to force the closure of hotels and motels if they accrue too many police and emergency calls.

Last month, the city council of Lawrenceville, Georgia, a suburban city of 30,000 residents roughly 30 miles north of Downtown Atlanta, approved the purchase of the Villa Lodge, a 60-unit extended-stay hotel. The city plans to raze it by the end of September as part of a larger downtown revitalization effort.

“It's been one of our highest-crime properties over time,” Lawrenceville City Manager Chuck Warbington said. 

Upward of 30% of the rooms were rented by residents who lived at the facility for a year or longer. Some had been living there for a decade or longer, Warbington said. Those individuals and families were forced to find accommodations elsewhere.

The city launched a program for Villa Lodge residents to be placed in other housing — either nearby apartments or other extended-stay hotels — in exchange for enrolling in jobs training courses and other life-skill programs. They were paid $3,600 to cover three months of rent and will be eligible to receive another $3,600 if they complete the program, Warbington said. Forty residents and families enrolled in the program, Warbington said, but some opted to forgo the stipend and training and moved in with friends or family instead, or simply left town.

“I understand the purpose of extended-stays for temporary housing,” Warbington said. “The problem is it becomes permanent housing, and it was never set up to be that way.”

An Alternative To Homelessness

Hard data that explains why people stay in extended-stay hotels is hard to come by, experts say. There are those who stay in them for temporary work assignments. Some book rooms because they just moved into a new area and haven’t found a permanent home yet. Then there are those who stay for months or more.

“This is really a population [that is] hidden homelessness. This really flies under the radar,” University of Buffalo School of Social Work associate professor Elizabeth Bowen said. “It's a population that's really invisible in a lot of ways and we really don't know about.”

The number of extended-stay customers who use the hotels as housing is a significant chunk of the client base, and local governments risk increasing homeless populations when they force hotels to close or prevent them from opening in their jurisdictions.

“That's going to cause more homelessness,” Berg said. “[If] that resource disappears, [renters] are not suddenly going to be able to afford a nice apartment by magic. If that resource disappears, then they'll probably be looking to a homeless shelter.”

Donald Murray said he could see that happening at his home when it was targeted by Gwinnett County, Georgia, officials last year for excessive incidents of criminal activity. The 53-year-old copy repairman has lived at InTown Suites in Norcross for four years, living with a family friend who was struggling with health issues, Murray said.

At the end of the year, Murray said he is finally moving out and into an apartment, something many of his neighbors at InTown Suites can’t do at the moment.

“There are single moms here,” Murray said. “It’s hard to say if they could afford to move.”

For vulnerable populations, these hotels have a lot of benefits. They generally don't require security deposits, they come pre-furnished and all utilities are provided as part of the weekly rate.

“Hotels serve as a kind of their own transitional housing for homeless people,” Bowen said.

Georgia State University School of Social Work Associate Professor Terri Lewinson said some would rather stay in a hotel than seek shelters or other government and charity services that address homelessness for autonomy and privacy. Hotels don’t ask for credit checks or conduct criminal background checks, and they allow payments week-to-week, unlike apartment leases.

“When you think about our housing market, the extended-stay hotel offers services that you don't get in our apartments,” said Lewinson, who has studied extended-stay hotel use and its relationship to homelessness. “It's a bundled resource for individuals who don't really have a lot of resources. I don't have to worry about coming up with $900 [a month]. I can just pay $100 this week.”

The Survivor Segment

The coronavirus pandemic has hit the hospitality sector hard. But of all pieces of the hotel industry, extended-stay lodging has managed to weather the storm the best.

The average occupancy of budget extended-stay hotels in the U.S. was higher in July than it was in January, increasing from 65% to 71.3%, according to hospitality research firm STR. During that same period, more expensive extended-stay hotels’ average occupancy fell from 66.5% to 57.3%.

STR differentiates lower- and upper-tier by the average daily rental rate. For the lower-tier extended-stays, rates have been hovering in the $60 range this year. The upper-tier hotels, like Residence Inn, generally charge $100 or more per night.

The budget end of the extended-stay spectrum generally sees guests stay for much longer periods of time. Thirty-one percent of revenues at the lower-tier extended-stay hotels were derived from guests staying 30 nights or more, according to a 2020 study by Kalibri Labs, a hotel analytics firm. Only 14% of upper-tier extended-stay hotel revenues were generated by those staying longer than 30 nights.

That hasn't stopped communities from pressuring extended-stay hotel operators. Gwinnett County Solicitor General Brian Whiteside has been on a yearlong mission to force owners of four extended-stay hotels in his jurisdiction to reduce crime on the properties or face closure.

The four hotels — two Red Roof Inns, a HomeTowne Studios and an InTowne Suites — combined reported three-and-a-half calls to police a day with a total of more than 1,700 incidents between 2018 and 2019, mostly for prostitution, domestic violence, weapons discharge, theft and trespassing, according to data Whiteside’s office provided.

“We had a concern about how criminals were able to stay there without any type of basic type of screening,” Whiteside said. “I was prepared to shut them down.”

None of the four were shut down after the hotel operators met with county officials and agreed to abide by more stringent standards in weeding out bad actors, he said.

“I think there's a place for extended-stay hotels in the county, but they have to meet a high standard and treat people right,” he said. “If it was up to me, if they're a problem again, I would move to close them down and ask them to be condemned.”

But when public officials focus just on the bad actors in those properties, they overlook the families just struggling to make it day-by-day, said Lewinson, a former social worker.

“I think for the most part, people are short-sighted about who are the patrons of extended-stay hotels,” Lewinson said. “We tend to dwell on those just who are ostracized in our society, like those who are addicted to drugs.”

One City, 13 Closed Hotels

Two years ago, the Branson, Missouri, City Council passed a set of new codes targeted at a collection of budget hotels and extended-stay hotels aimed at improving standards and establishing annual inspections with health and safety officials. The hotel owners also had to provide patrons with regular linen service and other amenities geared toward discouraging long-term rentals.

Those code changes led 13 hotels in the city to shutter in the two years since, Branson Director of Planning and Development Joel Hornickel said.

“The concern is, prior to our code change, these properties were falling into disrepair and people were not given the opportunity for a safe, comfortable place to stay at night,” he said. “Even if a property allows people to stay for an extended period of time, they still have to provide them with the basic necessities of staying in a hotel.”

While the move has improved conditions at many hotels, it also only exacerbated the plight of families making low wages in the city’s largely tourism-based economy. The city needs an estimated 1,300 affordable housing units to meet the growing demand, said Bryan Stallings, the founder of Elevate Branson, a nonprofit that helps those living in extended-stay hotels.

“We don't have a large physical or unsheltered problem. We have more of a working poor or sheltered poor problem,” Stallings said. “[Extended-stay hotels are] not the solution, it just ended up becoming one due to the lack of affordable housing.”

Prior to the pandemic, Stallings said there were 2,500 people in the city using extended-stay hotels as affordable housing. Many work in the tourism industry in Branson, a city with a permanent population of under 12,000 people that nevertheless has become a Midwest hub of country music.

As tourism has plummeted this year, the number of jobs in the industry cratered, and more than 1,000 people moved out of Branson’s extended-stay hotels after their jobs disappeared. For now, that means there are more available rooms in the city, reducing the risk of the city’s vulnerable residents becoming homeless, Stallings said.

His group is also building a tiny home community on 5 acres it owns that will be part of a program to shelter vulnerable populations. The community will also have job training opportunities, like an on-site automotive garage and a pottery-making facility.

Stallings said he agreed with the city’s decision to shutter some of the hotels, as they were infested with insects, had become hubs of crime and fell into disrepair. But he warned that even a justified hotel closure can cause people to fall into homelessness, especially since the closest city with a homeless shelter is Springfield, Missouri, nearly 350 miles away.

“You shut down a dilapidated [hotel], it's subpar living conditions, but people settle because that's all they have,” he said.

He said as many as 400 children have been living at Branson’s extended-stay hotels. But as more than a dozen of the hotels have closed — some of which did so on their own instead of complying with the new codes — and the pandemic hammered the tourism industry, Branson locals told the Springfield News-Leader in July that the city’s homeless population was on the rise, as those who moved out of the hotels had nowhere else to go.

Stallings said many of those displaced by the shuttered hotels were assisted by area organizations to find other accommodations. But even that was not an ideal situation, as the hotels many of these people go to aren't much better than the ones that closed, Stallings said.

“You're just going from subpar living place to another subpar living place,” he said.

Hornickel, the head of planning and development, acknowledged that the city has an affordable housing issue it needs to address. He said the city has “seen some interest” from developers trying to build it, but Branson’s terrain on an Ozark, where the ground is more rock than dirt, makes any new construction expensive, therefore unlikely to be affordable.

“There are [developers] looking at hotels and trying to convert them into apartments,” Hornickel said. “Granted, it's a drop in the bucket.”