Last fall, the Aspen Skiing Company had a problem. The operator of the famed Colorado slopes had a record number of job applications—but knew from experience that most workers would turn down offers or quit when they tried to find a place to live in the mountain towns that dot the valley of the Roaring Fork River. What would unfold as a worker shortage was really a housing shortage.
Ski Co didn’t even need more housing than usual. Its headcount hadn’t grown. The problem was a new type of seasonal employee populating the area: remote workers.
“The beds have been evaporating very quickly from the valley,” company HR chief Jim Laing told the local city council, according to the Aspen Times. Rentals were “not going away, they’re just going to different people,” he said. “A lot of people came and they never left.”
So with visitors filling up local houses (and paying top dollar for the privilege), Ski Co had resorted to putting employees in a last-ditch option: a hotel an hour’s drive away.
Ski Co’s predicament joined a host of related—and growing—housing conundrums. With schools out and summer vacation underway, the country’s warm-weather destinations are finding out just how much housing long-stay vacationers will eat up. Month-plus Airbnb rentals now make up the company’s fastest-growing sector. Housing conflict is also in the air in cities, where bidding wars for rental apartments have become commonplace and historic rent surges are driving inflation, displacement, and homelessness. Record numbers of people are living on the streets of cities like New York, Los Angeles, and San Francisco.
America once provided a solution to all of these problems—a flexible, variable-term accommodation that welcomed prosperous vacationers, footloose young people, the elderly, and the destitute. I speak, of course, of the hotel. Hotels remain a $168 billion industry in America for business travel and vacation, with seven hotel nights booked each year for every American. They employ more than 2 million people, according to the American Hotel & Lodging Association. But most people, like the marooned ski bums of Aspen, don’t consider hotels to be on the continuum of housing.
They should. Hotels—grand ones, modest ones, inns, motels, and single-room occupancies—once filled a crucial niche in the American housing ecosystem. And now they should again.
It’s already happening, quietly. Urban homelessness advocates have embraced single-room-occupancy hotels, or SROs, as a first response to get people off the streets. Investors are pouring money into extended-stay hotels, recognizing that they offer a vital option for traveling workers like nurses, new arrivals, and families struggling to find permanent housing. Airbnb stays of more than a month now make up one quarter of the company’s bookings. Urban co-living projects—with their short-term leases, furnished rooms, and shared amenities—re-create many of the perks residential hotels once offered (and attract much of the same scorn as well). So do college dormitories and retirement homes, for their respective residents.
But we are far from the golden age when Henry James, marveling at the architectural magnificence and social vigor of America’s great hotels, could ask “if the hotel-spirit may not just be the American spirit most seeking and most finding itself.” We need to conjure the hotel-spirit once again and revive a bygone view of the hotel itself—not simply as a commercial enterprise, but as an indispensable source of homes. It’s time America checked back in.
One morning at 5 a.m., the manager of Manhattan’s Hotel Elysée received a call from a guest who complained that the tap-tap of the typewriter in the next room was keeping her awake. “We knew right away who that was,” Leon Quain later told Jimmy Breslin of the New York Daily News. “What could we do? We can’t tell Tennessee Williams not to type.” The sleepless lady was moved; the typing continued until the hotel’s resident playwright died, after choking on a plastic bottle cap, in 1983.
Pick a famous American of the last century, and odds are they lived the hotel life. Bob Dylan and Joan Baez. Joe DiMaggio and Marilyn Monroe. Patti Smith and Robert Mapplethorpe rented a room at the Chelsea Hotel, but then, who didn’t?
Not everyone lived like Eloise at the Plaza, either. Smith and Mapplethorpe weren’t rich, not yet, and they came to the Chelsea from the fleabag Allerton Hotel. That was just a normal thing to do in those days. It was not prohibitively expensive to stay a while, once you found a place in your price range.
Every city had its grand hotel, or a few of them—“novel, inspired, and highly visual expressions of a city’s ranking in the world,” Molly Berger writes in her book, Hotel Dreams. These cities within cities offered, in the words of a 19th century advertisement from Philadelphia, “Everything of life—free from care, and at small cost.” For bachelors, married couples, and especially women with children, this outsourcing of domestic responsibility—from cleaning to meals to heating, all the way down to buying the furniture—was liberating, and many grand hotels were more than half-occupied by permanent residents. Even a room in the best hotel cost just a fraction of the price of keeping a full house with similar amenities. A big hotel solved the “servant problem,” offered access to state-of-the-art perks that hotels pioneered (baths, elevators, electric lights), and granted instant social standing.
Similar benefits accrued to long-term hotel guests further down the income ladder, whether they were unmarried clerks and saleswomen or sailors and transient workers just passing through. At a rooming house, for example, tenants didn’t need to buy sheets and towels, dishes, or furniture. The arrangement permitted young Americans to live downtown and to win early independence from their families.
Even vacation hotels were geared toward longer-term guests, like the Merritt Hotel conjured up by Saul Bellow in The Adventures of Augie March: “greenery and wickerwork, braid cord on the portieres, menus in French, white hall runners and deep fat of money, limousines in the washed gravel, lavish culture of flowers bigger than life, and triple-decker turf on which the grass lived rich.”
Such places were the economic engines of vacation spots from Mackinac Island to Miami Beach, and guests typically stayed for weeks or months at a time. Travel was slow and complicated, which suited these large, full-service accommodations perfectly. Perhaps most importantly, such places were communities where children found playmates and where grown-ups reconnected with friends, summer after summer.
To some extent, hotel life collapsed because we didn’t need it anymore. Cars and planes opened up a much wider territory for vacationing. Two-earner households with demanding jobs couldn’t swing a full summer at the beach (nor, perhaps, with a house in the suburbs, did they feel they needed one). New development models, such as timeshares and condos and retirement communities, scooped up high-end clientele. A booming midcentury economy made it hard to retain the ample staffing necessary to “keep” a grand hotel. Federally subsidized suburbanization reduced the urban housing crunch, and white flight and Sun Belt migration left many older cities feeling like they had, all of a sudden, too many hotels—often in declining, redlined neighborhoods.
But hotel life was also done in by a moralizing opposition. From the beginning, it was precisely the easy style of city living that hotels made possible—the rootlessness, the lack of attention to homemaking, the lively scene—that alarmed progressive crusaders, especially where women were concerned. “The bad effect upon the community of a congregate form of living is by no means limited to the poorer people,” wrote the housing reformer Lawrence Veiller in 1905. “Waldorf-Astorias at one end of town and ‘big flats’ at the other end are equally bad in their destruction of civic spirit and the responsibilities of citizenship.”
Moralists could not reduce the appeal of the Waldorf, but their rhetoric about hotels seemed to track with the visibly declining status of hotel denizens. The late Paul Groth, in his indispensable history Living Downtown, noted that in the postwar city, “the people who symbolized social and personal failure became more vividly associated with hotel homes”:
While a relatively small percentage of successful people were known to live in hotels, a very high proportion of hoboes, poor single clerks, drunks, and prostitutes were known as hotel residents. From the carriage, streetcar, or automobile one was far more likely to remember a bum who had passed out in front of a cheap lodging house than the happy thirty-year-old clerk walking to his rooming house. … In zones of converted houses, the ROOMS TO RENT signs and the rooming houses they represented came to be seen as the cause of urban blight rather than the side effects of underlying migration, layoffs, real estate speculation, or expansion of the business district.
Starting in the early 20th century, building codes outlawed models of kitchen and bathroom provisions that were common in residential hotels. Zoning laws kept new hotels out of prosperous city neighborhoods and suburbs, ensuring a concentrated and dilapidated hotel housing stock. Hotel managers sought to specialize in short-term stays to dodge rent control laws. Urban renewal bulldozed hotel districts as a slum clearance policy that minimized, on paper, its disruptive impact: Hotels weren’t counted as housing, Groth wrote, so displaced hotel occupants weren’t counted as displaced residents. Parking requirements made it impossible to build low-income multifamily housing without subsidy. And Congress excluded SROs from low-interest rehab loans and Section 8 vouchers—because, as the Department of Housing and Urban Development put it, the agency’s purpose was not to encourage a housing environment “in any way inferior” to society’s standards. Many low-income housing activists felt similarly.
In Homeless, Gerald Daly writes that New York lost 109,000 SRO units between 1971 and 1987. Roughly half the SRO stocks of Los Angeles and Seattle vanished in the same time frame. Chicago lost 23,000 units in the decade between 1973 and 1984—the equivalent of demolishing 100 public housing towers.
The campaign to eliminate hotel life was remarkably successful. In 1910, for example, San Francisco had a hotel room for every six residents. Today it has 1 for every 25.
A form of housing was deemed uncivilized, and erased.
Some planners began trying to repair the damage as early as the 1980s.
As with today, down-on-their-luck urbanites found there was simply nothing at the lower end of the housing ladder between renting an apartment and sleeping on the street. There actually wasn’t a place to go when you’re short on dough. As Frank Landerville, executive director of the Regional Task Force on the Homeless in San Diego, a city that saw the light on SROs early, used to say: “While you won’t solve your homeless problem just by building SROs, you can’t solve your homeless problem without them.” Low-income housing developers built several thousand units before San Diego neighbors struck back, enacting a minimum parking requirement that all but killed the SRO market.
The need for more low-cost hotel options is well established and has been, with some exceptions, in many urban places for thousands of years: Jesus was only born in a manger because there was no room at the inn. But replenishing the stock in expensive cities where neighbors don’t want to live near the poor has been slow going. Los Angeles, for example, has struggled to build housing for the homeless in many neighborhoods despite banking billions for the purpose. Big cities have had more luck housing the homeless in converted short-stay hotels; New York City rents thousands of rooms for homeless families. California’s Project Roomkey used the crisis of the pandemic to help cities rent hotels for those families—some of which were later purchased for permanent housing, through the related Project Homekey.*
The need for medium-term lodging is acute in higher-income brackets as well. Extended-stay hotels—rooms with kitchens that do not require a lease and can be rented by the week or month—are the hottest thing in the hospitality sector.
Gary DeLapp is the president of StayApt Suites and the former chief of Extended Stay Hotels. He described the emergence of his niche for business travelers like this: What remains of the full-service hotel model that was popular at midcentury—with room service, a pool bar, and other high-touch amenities—is now a luxury product. Most operators slimmed down. That left long-stay guests on any kind of budget at all stuck with a bare-bones room at the Hampton Inn. DeLapp’s StayApt Suites provides full kitchens, sofas in front of the TV, and a separate bedroom. The median stay is 17 days.
In 2020 and 2021, extended-stay hotels had an occupancy rate of 74 and 73 percent, respectively, as all other hotel categories struggled to stay half-full. The Blackstone Group, (in)famous for its investments in single-family rental homes, has dropped more than $7 billion on a pair of extended-stay hotel investments in the past two years. Ryan Meliker, president of Lodging Analytics Research & Consulting, a hospitality consulting firm, told the Wall Street Journal that extended-stay hotels are twice as profitable as regular hotels. “They’re like ATMs with a roof,” he said. “They print money.”
Guests, meanwhile, save money relative to regular hotels—and can depend on a reliable, turnkey experience. Kelly Poling, executive vice president of Extended Stay America, which operates more than 62,000 rooms, told me the hotel makes it a priority to hire staff who want to create “meaningful and lasting” relationships with the guests. The FEMA contractor in Room 218 may not be Tennessee Williams at the Elysée, but after a few weeks, she may get a first-name greeting at the front desk.
The number of extended-stay rooms has grown by more than 50 percent since 2015, according to industry analyst the Highland Group, and the nation’s 560,000 extended-stay rooms now make up 10 percent of the national hotel room stock.
Extended-stay hotels appeal to traveling professionals and institutions like universities and ski resorts that need to house seasonal workers. But they are also a housing option for families on the losing end of a red-hot housing market: In 2019, 45 percent of nights at low-cost extended-stay hotels in Gwinnett County, near Atlanta, were for a month or longer—often a sign of residency. The share is now 67 percent.
The hotel industry is also desperate to compete with Airbnb for well-heeled clientele. In Denver, Catbird is a boutique long-stay hotel for the “live-work-play” set where the rate for a room with a kitchen drops from $350 for one night to $65 a night if you book for a month. Even further up the chain is AKA Hotels+Hotel Residences, with its premium fixtures and rooms in high-cost cities like New York, Los Angeles, Miami, and London.
If all this is invisible to you, you’re not alone. Long-stay guests are an attractive thing for hotels. They cut vacancy, save labor, and can dodge costly hotel taxes after a certain number of days in residence. But you’re unlikely to see weekly or monthly rates advertised at your average downtown hotel, said the hotel consultant Hank Jones. That’s in part because short-stay room rates at these hotels are so high that managers can make long-stay money with just a few booked nights each month. It’s also in part because each parent company has, over the past couple decades, developed its own specialized branch for this purpose: Hyatt House, Element by Westin, Homewood Suites by Hilton, Residence Inn by Marriott, Executive Residency by Best Western, and so on.
What’s more, the rapid growth of long-term Airbnbs illustrates that those offerings aren’t compelling for many travelers. Between the first quarter of 2019 and the first quarter of 2022, Airbnb rentals of more than a month more than doubled. The short-term rental platform is often blamed for eating into the long-term housing stock, but it is really just a symptom of a market failure: Many people want to stay in cities for middling periods of time, with varying preferences for amenities and privacy, and the peer-to-peer rental marketplace offers them what they need.
Airbnb fills a legitimate function—because the hotel business hasn’t. Options for affordable midlength hotel stays in many nice city neighborhoods are absent. So too are longer-term options for single people, who wind up cohabitating in family-size houses and apartments in the absence of smaller, affordable units (a practice that, in turn, deprives families of a place to live in the city). Traditionally, hotels didn’t just provide an off-ramp for people chased out of traditional housing; they also created an entry point. Once, new arrivals could be confident they had a place in a city to lay their head for weeks or months as they looked into more permanent options. Is it any coincidence that Americans are stuck, with residential mobility at its lowest point in decades?
The hotel management professor Linchi Kwok told me the industry is working hard to catch up with Airbnb, including by actually buying houses—Homes & Villas by Marriott International now rents out 60,000 properties. But hoteliers are also restricted by codified old prejudices about hotels that do not get the same regulatory, financial, or popular treatment as apartment housing. All those rules set up to squash the residential hotel at midcentury are still in force. Hotels are still relegated to downtown, which is expensive, or to suburban commercial strips, where residents have a hard time finding food, fun, services, or community.
Whatever the opposition is to new housing, the opposition to new hotels is greater. You simply could not build a grand hotel today in, say, Edgartown, Massachusetts—even as remote-working summer people continue to rent away Martha’s Vineyard’s scarce housing stock.
This dynamic is not confined to small towns. New York City has all but banned the construction of new hotels, despite the evident pressure on rental apartments exerted by Airbnb listings. Many travelers say they prefer Airbnb, but do they really want to live in someone else’s house? Maybe they just want a kitchen, or a separate bedroom for the kids. Oftentimes what travelers really treasure is a form of legal arbitrage that Airbnb has over traditional hotels: the ability to operate as part of a residential neighborhood.
Airbnb’s opponents seem to think there’s something unsavory about this unstoppable market for transient people with suitcases—the hotel is coming from inside the house! They’re right that Airbnb is a bad development for anyone who needs an apartment long term as well as for neighbors who share a corridor with an ever-changing set of guests. Historically speaking, though, the anomaly isn’t the thin line between permanent and temporary housing. It’s simply the lack of a good neighborhood hotel.
Correction, July 19, 2022: This piece originally mischaracterized Project Roomkey as a program that allowed California to buy hotels for the homeless. Project Roomkey permitted California jurisdictions to rent hotels for the homeless; Project Homekey helped them purchase those hotels.