San Jose City Council Approves Hotel Conversion for Student Housing In a unanimous decision, the San Jose City Council has given the green light to a plan that will convert a portion of a hotel into student housing. The deal, approved between San Jose State University and the owner of the former Fairmont Hotel (now Signia by Hilton), involves selling off the south tower of the hotel, which comprises roughly one-third of its 705 guest rooms, for student housing purposes. City officials have acknowledged that this move is a double-edged sword. On one hand, with hotel occupancy rates down, converting the rooms into student housing could potentially save the struggling hotel from bankruptcy. Additionally, having students in the area could provide support to surrounding businesses. However, the reduction in available hotel rooms may limit the city’s hotel tax revenue from hosting conventions. Charlie Faas, the vice president of administration and finance at San Jose State, believes that filling up the hotel with students on a daily basis and during summer internships will create a vibrant downtown, filling the empty storefronts and contributing to the overall growth and development of the area. Faas also pointed out that the only two events capable of filling up the hotel are the World Cup and Super Bowl, both of which are scheduled to come to San Jose in the near future. San Jose State has recently been recognized as the eighth most affordable college out of 25 major U.S. cities. However, advocates have highlighted the challenges faced by its students, as 11.2% of them have experienced homelessness due to the high cost of living in the area. The university missed out on millions in state funding for affordable student housing last year. Vice Mayor Rosemary Kamei expressed concerns about the loss of hotel tax dollars for the city. Mayor Matt Mahan, on the other hand, explained that the rooms in the south tower are typically empty and do not generate much revenue anyway. With a projected budget deficit next year, the city is seeking solutions to address the ongoing financial challenges. While the decision to convert hotel rooms into student housing may have short-term consequences for the city’s hotel industry, there is hope for a future resurgence. Mayor Mahan expressed his optimism, suggesting that in a few years, new hotels could be built to meet the increasing demand when downtown bounces back. The pandemic has significantly impacted San Jose’s hotel industry, with downtown hotels experiencing an average occupancy rate of only 56%—almost 20% lower than pre-pandemic levels. A full recovery is not expected until at least 2025. This loss of hotel rooms is likely to slow down the recovery process and have a negative impact on the overall visitor economy, particularly for booking events at the nearby San Jose McEnery Convention Center. Councilmember David Cohen raised concerns about giving up significant business opportunities from conventions every time a hotel room is lost. While there is some uncertainty about the short-term impact of this decision, it is important to consider the long-term potential for growth and development in the city. In conclusion, the approval of the hotel conversion for student housing in San Jose reflects the city’s commitment to finding solutions amidst the challenges faced by both the hotel industry and the student population. Balancing the immediate needs of the hotel and the long-term goals of the city is a delicate task, but with careful planning and consideration, San Jose can navigate these challenges and pave the way for a brighter future. Note: The content of this article is for informational purposes only and should not be considered legal advice. The information provided is based on the news article “San Jose greenlights hotel conversion for student housing” published by Bay City News, Inc.