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Could Renovating Abandoned Hotels and Motels Solve California's Housing Crisis? Adaptive reuse is gaining traction as more state officials introduce the possibility of converting large abandoned spaces into affordable housing.

By Richard Maize Edited by Amanda Breen

Opinions expressed by Entrepreneur contributors are their own.

Solving the housing crisis is a nuanced issue that plagues the minds of many all around the world. In this country, specifically, the problem has caused rifts among political parties. Regardless of which party you identify with, you're likely just as lost as anyone else when it comes to finding a solution. And if you have any heart at all whatsoever, watching homeless encampments be torn down in a misguided effort to "clean up" communities is nothing short of horrific. Where are these people supposed to live when even those with relatively solid salaries struggle to find affordable housing themselves? As long as we see the cost of housing rise, this issue will only worsen for everyone.

Currently, in the great state of California, we face two major housing issues: a severe lack of affordable housing — especially for renters — and abandoned hospitality and office buildings due to the Covid-19 lockdowns and restrictions. Adaptive reuse is not a new concept by any means. Still, the idea is gaining traction as more state officials introduce the possibility of converting these large abandoned spaces into affordable housing.

Related: These Wildly Successful Entrepreneurs Once Were Homeless

Could these abandoned spaces help solve the housing crisis?

Using California's Project Homekey as our example, we can take a deeper look into how converting abandoned hotels and other viable spaces can be an answer to the affordable housing crisis. During the pandemic, cities with large homeless populations decided to move people off the streets and out of crowded shelters into empty hotels. This initiative sparked an idea in Governor Gavin Newsom's mind, and California officials ran with it by creating Project Homekey.

The state purchased entire hotels and old office and apartment buildings and converted them into thousands of affordable new units. Since its launch last summer, HomeKey has already created over 6,000 new units in California, where affordable housing is as easy to find as the proverbial needle in a haystack.

"We've long dreamed about scooping up thousands of motel rooms and converting them into housing for our homeless neighbors," said Governor Newsom in a release back in June of 2020.

For the naysayers and skeptics arguing the homeless need to work to earn their housing, well, you need an address just to fill out a job application. A tent that is constantly being moved around, whether by the occupant's choice or city officials, does not suffice. Did the homeless crisis exist before the pandemic? Obviously, yes. But the crisis has only been exacerbated in the last year and a half.

Related: How Monique Brandon Is Fixing California's Affordable Housing Crisis

Millions of people lost their jobs during the pandemic or took such severe pay cuts they were unable to continue paying rent or conjure up the funds to throw down first and security on a more affordable home. As a result, people were left with little to no options, bouncing around from couch to couch or moving into their cars and vans, and many were forced out onto the streets. In a country where the cost of living rises at a rate exponentially higher than the rise of wages, what did we expect?

Perhaps unsurprisingly, some communities are fighting back, horrified at the thought of low-or-no-income housing coming into their neighborhoods. Governor Newsom's plans set off a slew of complaints and legal troubles, as neighbors opted to sue when the news that these abandoned dwellings would be converted into housing for vulnerable and displaced people.

Cities complained they did not have sufficient input in these plans, and several purchases fell through as a result. That said, many local governments are on board, and nearly 100 deals closed within just a six-month period. Generally speaking, there is a broad agreement among city officials that converting hotels into housing can be a solution to the rising affordable home crisis.

The impact on the environment

Converting these abandoned dwellings fills immediate needs — and it also has a positive impact on the environment. Repurposing existing structures rather than demolishing and developing new ones generally results in a lower environmental impact. Even if a portion of the building needs to be dismantled, refurbishing rather than demolishing often saves up to 95% of the existing materials.

A hefty argument can be made that getting more people off the streets can improve a city's pollution problems as well. Less trash and human waste on streets and sidewalks are among the many ways housing the homeless can improve everyone's quality of life, not just for the people finally able to say they have a safe home to call their own. In addition, homeless individuals and families are directly impacted by climate change as people living on the streets are not able to escape the effects of air and ground pollution.

Homelessness is not an epidemic that pops up overnight. It is a systemic problem that cannot be solved by destroying encampments and forcing people to vacate the area with nowhere else to go. Advocates have spent months trying to find ways to improve these initiatives and are pushing for cities to continue with these efforts even as the Covid-19 pandemic slows down. Pandemic-related or not, as long as we continue to see rental prices rise, we will continue to see more and more people out on the streets, living in tents and cars and anywhere that can serve as shelter.

Related: An Amazon Worker Says She's Homeless Because She Can't Afford NYC Rent

While we still have to wait and see how these initiatives will benefit communities long-term, perhaps knowing that thousands of displaced individuals and families currently or will eventually have a place to call home may help some of us sleep better at night in our air-conditioned homes and cozy beds.

Of course, you can always volunteer your services in the meantime. Donate clothes, furniture and anything you can to these organizations working around the clock to secure housing for the homeless. If you have a business that relates to housing, now is the time to look into ways you can help. No matter which way you look at this problem, the fact is this is a community effort. Federal funding can only get us so far. If you want to see your community improve, you need to find your own way to help, even if that just means getting out and voting for policies that directly — and positively — impact the homeless.

Richard Maize

Financial and Investment Consultant

Richard Maize is a real-estate entrepreneur who has built a well-respected reputation for making astute business investments. Before the age of 30, Maize had already accumulated 1,000 apartment units, and he now owns property in 20 states. Additionally, Maize invests in TV and film and philanthropy.

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