One Year, Zero Conversions: New York Revamps its Hotels-to-Housing Program

It’s been a year since the New York State Legislature adopted the Housing Our Neighbors with Dignity Act (HONDA)—a law designed to spur the conversion of vacant hotel rooms in New York City into housing. Since the law’s adoption, however, not a single hotel has been converted into housing, according to an article by David Brand for CityLimits.

According to the article, the example of the Paramount Hotel in Manhattan illustrates where the law has fallen short of its goals:

The organization Breaking Ground worked for months on an agreement with the building owner to purchase the Paramount and transform it into supportive housing, just as they have done with other large, historic Midtown hotels, according to people familiar with the proposal. The deal crumbled when the powerful Hotel Trades Council (HTC) vetoed the sale to preserve 170 union jobs at the Paramount.

Brand adds:

HONDA includes a provision that the union must consent to conversion at a unionized hotel, and HTC was instrumental in getting the law and the recent revisions passed—without its support, HONDA would have been D.O.A. In a statement to City Limits, the union head made clear they will never forfeit their strong contract, effectively wiping out any chance of converting large hotels like the Paramount.

According to Brand, New York Gov. Kathy Hochul approved changes to the law earlier this month.

The measure, approved last week by the state legislature, amends New York’s multiple dwelling law to allow hotels to become permanent housing while retaining their current certificates of occupancy and bypassing onerous code requirements. The legislation also overrides land use restrictions to allow such conversions in manufacturing zones located within 400 feet of a residential district.

The article puts HONDA in context of Mayor Adams’s housing goals (the mayor announced a goal to convert 25,000 hotel rooms into permanent housing in September 2021), and includes a lot more detail about the various considerations, financial and planning-related, that can make or break hotel conversions in the New York City.